Banking - Armenia

Armenia

In Armenia, the Net Interest Income in the Banking market is anticipated to reach US$207.90m in 2024.
The market is primarily dominated by Traditional Banks, with a projected market volume of US$197.60m in the same year.
Looking ahead, the Net Interest Income is expected to exhibit a compound annual growth rate (CAGR 2024-2029) of 11.14%, resulting in a market volume of US$352.60m by 2029.
When compared globally, China is expected to generate the highest Net Interest Income, amounting to US$4,332.0bn in 2024.
Armenia's banking sector is experiencing a surge in digital banking services, as more customers embrace online and mobile banking solutions.

Key regions: United States, China, Japan, Brazil, United Kingdom

Definition:

The Banking market refers to the financial services sector providing financial products and services to individuals and businesses. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.

Structure:

The market consists of two segments:
- The Traditional Banking market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels.
- The Digital Banking market refers to the emerging market for digital-only banks that offer financial services through online and mobile platforms.

The market data comprises Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the Retail & Commercial banking market, creating opportunities for new entrants, and forcing existing players to adapt.
Key players in this market are companies such as the Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

Armenia's Banking market is experiencing steady growth and development, driven by various factors that shape customer preferences, market trends, and local special circumstances.

Customer preferences: Armenian customers in the banking sector are increasingly leaning towards digital banking solutions, such as online banking and mobile banking applications. This shift is primarily due to the convenience and accessibility offered by digital platforms, allowing customers to conduct transactions and manage their finances efficiently from anywhere at any time.

Trends in the market: One notable trend in the Armenian Banking market is the increasing focus on financial inclusion and accessibility. Banks are expanding their reach to underserved areas and populations, offering tailored products and services to meet the diverse needs of customers. Moreover, there is a growing trend towards sustainable and socially responsible banking practices, with banks incorporating environmental and social considerations into their operations.

Local special circumstances: Armenia's Banking market is influenced by its geopolitical location and economic ties with neighboring countries. The country's close relationship with Russia, for example, impacts the flow of investments and capital in the banking sector. Additionally, the presence of a large Armenian diaspora around the world plays a significant role in shaping the market, as remittances from abroad contribute significantly to the country's economy.

Underlying macroeconomic factors: The stability of Armenia's economy, coupled with prudent fiscal policies and regulatory frameworks, provides a favorable environment for the growth of the Banking market. Additionally, ongoing efforts to enhance financial literacy and education among the population contribute to the overall development of the banking sector. Overall, the Armenian Banking market is poised for continued growth and innovation as it adapts to evolving customer needs and market dynamics.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.