Converse Bank’s business loans are aimed at development of your business and realization of your business ideas.
We provide lending to micro, small, medium, and large businesses.
Wo can be an acceptable client for Converse Bank’s business loans?
“Converse Bank” CJSC’s client can be any legal entity, private entrepreneur, and in case of agricultural financing – also a private individual, as well as a group of private individuals (represented at the bank by the respective authorized group member), who applies to the Bank to obtain financing not forbidden by the Bank’s credit policy.
What are the criteria for separation of Converse Bank’s business loan clients?
The Bank’s clients are classified according to their belonging to the following group attributes:
| Number of employees | Annual turnover | Gross credit Position to the Bank | |
|---|---|---|---|
| Micro business | 1-10 | up AMD 100,000,000 | up to AMD 5,000,000 equivalent |
| Small business | 11-50 | AMD 100,000,001-500,000,000 | AMD 5,000,001-100,000,000 equivalent |
| Medium business | 51-250 | AMD 500,000,001-1,500,000,000 | AMD 100,000,001-200,000,000 equivalent |
| Large business | above 251 | above AMD 1,500,000,000 | above AMD 200,000,000 equivalent |
During determination of the fact of belonging to a group, the maximum of the indices specified in the table is considered, which can be only increase during the validity term of the given borrower’s active loans.
How can one get the details?
For detailed information, you can apply to the Bank’s head office at:
Republic Square
26/1 Vazgen Sargsyan
Tel.:. +374 10 511200, +374 10 511211
As well as all branches of the Bank
What interest rates are applied for Converse Bank’s business loans?
Attention: The interest rates specified herein are the minimum guiding threshold. The actually offered interest rates should be adjusted for each financing, taking as a basis the purpose and structure of financing, the client’s profile, financial and risk assessments, and other criteria.
1. Interest rates for micro, small, medium, and agricultural loans/credit lines provided from own or project funds
| Type of financing | Currency | Project/own | Up to 1 year | 1 - 3 years | 3 - 5 years |
|---|---|---|---|---|---|
| Micro Fast Maximum AMD 1,500,000 or its equivalent in other currency |
AMD | Project/own | 20%/20% | 22%/22% (up to 2 years) | - |
| USD | Own | 17% | 19% (up to 2 years) | - |
|
| Standard Fast /secured with collateral /limit - AMD 1-10,000,000 or its equivalent in other currency |
AMD | Project/own | 14%/20% | 14%/21% | 14%/22% |
| USD | Own | 14% | 14% | 15% | |
| Small financing AMD 10.000.001- 100,000,000 or its equivalent in other currency |
AMD | Project/own | 14%/20% | 14%/21% | 14%/22% |
| USD | Own | 13% | 13% | 14% | |
| Medium financing AMD 100.000.001- 200,000,000 or its equivalent in other currency |
AMD | Project/own | 16%/20% | 16%/21% | 17%/22% |
| USD | Own | 13% | 13% | 14% | |
| Agricultural financing | AMD | Project/own | 14%/20% | 14%/21% | 14%/22% |
| USD | Own | 12% | 13% | 14% | |
| Euro** | Euro | 11.0% | 11.0% | 12.0% |
** In case of financing in Euro, the same interest rates are applied, of the amount and source.
2. Interest rates for large financing
Interest rates are determined in the result of the client’s analysis, based on the results of assessment of financial and risk criteria.
3. Conditions of AMD overdrafts
The interest rates for AMD overdrafts is 20 percent annual, maximum maturity is 24 months, and the interest rate for projects is 14 percent annual.
4. Interest rates for unused limit
The minimum guiding interest rate for the unused limit of credit lines and overdrafts is 3.0%.
5. The maximum amount of loans provided to start-up business is USD or Euro 100.000
Annual interest rates
| Currency | Interest rate |
| USD | 17% |
| Euro | 15% |
The client pays penalty to the Bank:
- 0.15% of the overdue loan amount for each day of delay, and in case of availability of liabilities overdue for 5 (five) continuous working days – also a fine of 2% of the overdue loan amount, minimum AMD 5,000.
- 0.4% of the overdue interest amount for each calendar day of delay, and in case of availability of liabilities overdue for 5 (five) continuous working days – also a fine of 5% of the overdue interest amount, minimum AMD 5,000.
- for each violation of the loan disbursement preconditions – one-off penalty from AMD 50,000 to AMD 100,000.
- if there is a requirement to insure the pledged property, in case of failure to submit a copy of the insurance agreement (certificate) to the Bank within the specified time period - one-off penalty of AMD 50,000.
In case of loan repayment delays by the client or failure to perform other contractual obligations, other penalties and adverse consequenses can be set by the General Credit Committee for separate loan cases, including changes in the acting interest rate.
The provisions related to penaltiles and sizes thereof are specified in the contracts/agreements signed with the client.
Converse Bank offeres the following credit instruments to its clients:
- Loan
- Credit line
- Overdraft
- Agricultural loans secured with pledge of gold
- Loans for start-up businesses
Loan
A loan, as a rule, is used long-term but is also provided for making short-term investments. For loan installments, the current and future flows of the business are taken into account. A loan is repaid by installments, with deterred term or lump-sum, according to the agreed schedule.
The interest amount is calculated daily, towards the actual balance of the loan and, as a rule, is repaid monthly, but other schedule, compliant with the financing, can also be specified.
Credit line
A credit line, as a rule, is provided for the purpose of financing current business activity and turnover. This instrument is adjusted to the productive/commercial cycle of the business in terms of maturity and repayment, i.e. the loans disbursed within the framework of the credit line are brought into compliance with it and are repaid with the financial flows generated by each respective cycle.
A credit line is provided in form of a limit, during the validity period of which the loans specified in the clause above are disbursed to the client. During the whole validity period of the credit line, the client has the right to obtain a limited number of loans, on condition that the the total sum of the actual balances of the loans provided within the framework of the credit line and the amount of the new loan don’t exceed the total limit of the credit line. The terms and conditions and repayment schedule of the loans provided within the framework of the credit line are specified at the time of provision of the credit line. The following criteria are defined for the credit line:
| Credit line maturity |
Preferably 12 months, but before expiry of this term, according to the application, analysis of the client’s financial and economic activity is presented, on the basis of which the Bank’s General Credit Committee prolongs the maturity term or provides a new limit or terminates the credit line within the specified term. |
| Loan maturity |
Maximum 12 months |
| Interest rate |
Annual interest rate is specified, for the used and unused portions. |
| Disbursement |
Each loan within the credit line is disbursed on the basis of the client’s written application or application submitted via "Internet-bank" service, by approval of the Commercial Financing Department. |
| Repayment |
Interest – as a rule, monthly installments. Using the annual interest rate, the interest amount is calculated on daily basis, towards the actual balance; Principal amount – According to the schedule specified by the conditions of the credit line. |
Overdraft
An overdraft is provided for the purpose of financing the client’s short-term financial expenses (e.g. for performance of contractual obligations in line of different payments within a certain time period, irrespective of delays in payments by debtors and similar liabilities).
An overdraft is disbursed to the client’s banking account, by means of setting a negative (credit) limit. In case of absence of funds on the client’s banking account, the overdraft gives an opportunity to withdraw funds from the account in the amount of the maximum overdraft limit.
The following criteria are defined for the overdraft:
| Maturity | Preferably 12 months, but before expiry of this term, according to the application, analysis of the client’s financial and economic activity is presented, on the basis of which the Bank’s General Credit Committee prolongs the maturity term or provides a new limit or terminates the credit line within the specified term. During the two months preceding the expiry date of the overdraft, analysis of the client’s financial and economic activity is conducted, on the basis of which the Bank’s General Credit Committee can either prolong the maturity term of the overdraft or restructure it into a single loan, with the respective repayment schedule. |
| Disbursement | Starting from the moment of disbursement, the client makes use of the overdraft, by means of withdrawing funds from the banking account. |
| Interest rate | Annual interest rate is specified, for the used and unused portions. |
| Repayment | Interest – using the annual interest rate, the interest amount is calculated on daily basis, towards the actual balance and, as a rule, is paid on monthly basis. Principal amount –instalments are made from the funds credited to the client’s banking account, i.e. any credited amount (irrespective of its purpose) is used for repayment of the overdraft at the expense of the positive balance of gross credits and debits generated at the end of the day. The overdraft shall be fully repaid at the end of its maturity term. |
List of documents required for disbursement of loans
For your information: One of the first steps to obtain a loan is submission of the necessary documents.
Thus, your first step is to submit the following documents to the Bank:
The preliminary list of documents includes:
- Application to ACRA
- For legal entities –copy of the charter, and for private entrepreneurs and private individuals – personal identification document, as well as the personal identification document of the head of the legal entity’s executive body
- Copy of the state registration certificate issued by the state register
- TIN (tax code).
The list of documents required for decision making on disbursement of the product includes:
- Application for financing
- Rent agreement (copy)
- Documents evidencing the ownership right for the property offered as collateral (real estate, fixed assets, movable property, inventory, etc.)
- Preliminary evaluation (revaluation) act for the suggested collateral (վերագնահատման) or another basis for determination of its value
- Passports (personal identification documents) of founders, director and the chief accountant and their public services numbers or references on their absence
- For private individual pledgers and guarantors – copies of their passports or personal identification documents and consents of the guarantors for making inquiries regarding their credit history
- A reference from the tax inspection regarding liabilities
- Other douments, if requested by the specialist.
The list of documents required for disbursement of the product includes:
- An excerpt from the minutes of the general meeting or single participant – regarging the decicion taken to obtain financing and pledge property
- Evidence of the ownership right for the property offered as collateral, unless submitted during the previous stage
- Documents related to insurance of the collateral, receipts for the insurance premium (if insurance is required)
- Common reference on the pledged property, issued by the territorial units of the cadaster
- A reference from the SCI on availability or absence of seizure towards the pledged car
- Copy of the ownership or rent certificate for the business premises, or copy of the rent agreement, or another basis evidencing the client’s ownership for the business premises – reference, etc., for private individuals – a reference on the place of employment (e.g. from village municipality)
- By demand of the LD – copies of documents evidencing purchase of the pledged property
- In case of agricultural loans – a reference from village municipality
- Reference from the community management – form 2
- In case of open joint stock companies – a reference on shareholders issued by the register.
List of legal documents required for primarily secured loans
A legal entity client shall submit the following documents to the Bank:
1. The director’s passports (personal identification document) and the PSN or a reference on its absence
- Certificate from the state register
- TIN
- Charter
- Passports of participants or foundation documents
- In case of joint stock companies – a reference from the depository
- In case of commercial organizations - a reference from the state register regarding the members
- Other references, depending on another legal status
- The participants’ decision on obtaining a loan and offering collateral
Depending on the transaction and the positive opinion of the LD, the documents mentioned in clauses 5-9 might not be required from the client.
In case of legal entity clients, the LO replenishes the package with a reference from the state register and then submits it for approval.
For private entrepreneur clients:
2. The PE’s passport (personal identification document) and the PSN or a reference on its absence
3. Certificate from the state register
4. TIN
For other private individual client
- The PE’s passport (personal identification document) and the PSN or a reference on its absence
- Licence (for clients who pay licence payments)
- TIN
Pledged property can be any tangible and intangible asset not forbidden by the Credit Policy of “Converse Bank” CJSC, including a right subject to evaluation. The requirements specified herein are minimum requirements and can be made stricter by the loan officer or the employee approving the financing instrument.
In case of pledginf equipment, acceptable collateral items can be only those devices, for which the right of pledge can be registered in the respective state body of the RA, in accordance with the legislation of the RA. It means that the equipment should have either the ownership certificate, or an identification number.
The maximum ratio of financing/liquid value of the collateral is 70%, but, depending on the time of the pledged equipment, the following restrictions apply:
| Real estate | 70% (60%, if the pledged real estate belongs to a legal entity by the ownership right)* |
| Land plot | 50% |
| Vehicle |
|
| Equipment and special non-passenger vehicles | 50% |
| Monetary funds | up to 100% |
| Jewellery | up to 100% |
*Depending on the risk profile of the loan, other interest rates can be set.
The pledged immovable and movable property is subject to evaluation by one of the evaluating companies that cooperate with the bank. The client chooses the evaluation company. As a rule, the report on evaluation of the market/liquid value of the property is valid for 2 months following the date of its issue. If necessary, in case of changes of prices at the marker, additional evaluation can be required.
In case if the clients buy vehicles, construction and agricultural equipment at the primary market, no evaluation report is required, and the amount specified in the purchase agreement or the invoice is accepted as the evaluated market value, while the liquid value is 85% of the market value.
In case of pledging vehicles, CASCO insurance by an insurance company acceptable for the Bank is required.
For any pledged property, the Bank has the right to demand insurance, based on the purpose of financing, transaction, or pledged property profile.
- Insurance companies cooperating with the Bank
- Evaluating companies cooperating with the Bank
Forms and conditions of financing
How can one implement new initiatives, if funds aren’t sufficient?
Make use of the types of financing offered by Converse Bank’s, choosing the option most convenient for you, and implement your targeted undertakings
The form of financing is defined, depending on the current gross commercial financing credit position of the client towards the Bank amd the total amount of dinancing, as well as belong of the client to a certain group.
| Form of financing Conditions |
Micro | Small | Medium | Large | ||
|---|---|---|---|---|---|---|
| Fast | Standard | |||||
| Financing instruments | Loan, Overdraft, Credit line | Loan, Overdraft, Credit line | ||||
| Total sum of the existing and new financing, in AMD or its equivalent in other currency | Fast - 1,000,000-3,000,000 Standard - 3,000,001-10,000,000 |
10,000,001 - 100,000,000 | 100,000,001 - 200,000,000 | 100,000,001 - 200,000,000 | 200,000,001 and more | |
| Maturity | Maximum 36 months | Maximum 60 months In case of large loans, the maximum term of lending is 84 months In exceptional cases, by the GCC’s decision large loans can be provided with a longer maturity |
||||
| Security |
the Bank’s current clients, who, during the three years preceding the date of loan consideration: a/ had a positive credit history (provided that during the period under review the client didn’t have overdue liabilities towards the Bank delayed for more than 20 days in total), and
|
|
||||
| Interest rate | Is approved by the Bank’s Management Board. | |||||
| Fee for review of the loan application, charged from the client at the time of submission of the application to the Bank | AMD 5,000 | AMD 5,000 | AMD 10,000 | AMD 15,000 | AMD 30,000 | |
| Commission fee | The Bank can set other payments, by decisions of the General Credit Committee or the Management Board | |||||
Agricultural loans with pledge of gold
The loan is provided to citizens and residents of the RA.
| Loan currency and amount |
The loan is provided in AMD or USD. AMD loans are provided only in case if the loan meats the requirements of Annex 3 (“Procedure of Subsidizing the Interest Rates of Loans Provided to the Agricultural Sector) approved by decision No. 349-N of the RA Government dated 31.03.2011. The loan is provided in the following amount:
|
|
|---|---|---|
| Maturity, procedure of repayment of the loan and interest amount |
Loan maturity:
In case of AMD loans, a grace period up to 6 months can be granted for repayment of the principal loan amount and interests, during which the Client can refrain from repayment.
|
|
| Interest rate | Is approved by the Bank’s Management Board. | |
| Loan account service fee | Is charged from the client once, when disbursing the loan, according to the following scale | |
| Loan amount (AMD equivalent) | Service fee (AMD) | |
| 30,000 - 250,000 | 1,000 | |
| 250,001 - 500,000 | 2,000 | |
| 500,001 - 1,000,000 | 3,000 | |
| 1,000,001 - 2,000,000 | 4,000 | |
| 2,000,001 - 3,000,000 | 6,000 | |
| 3,000,001 and more | 10,000 | |
| In some cases, special regional tariffs can be set by decision of the Bank’s Management Board. The Bank can apply also other fee, by decision of the Bank’s Management Board. |
||
| Card account service | At the time of loan disbursement – one-off fee, AMD 1,500 | |
| Term of manufacturing and provision of the card | 2-4 working days | |
|
Fines and penalties |
The provisions related to penaltiles and sizes thereof are specified in the contracts/agreements signed with the client. |
|
| Security | Pledged jewellery | |
| Other conditions | Loans can be disbursed also by cards: In case of providing AMD loans by ARCA Classic, Visa Electron, Maestro cards, no fee is charged for provision and service of cards. In case of providing USD loans by Visa Electron or Maestro cards, no fee is charged for provision and service of cards. If the client prefers to get the loan by other caards, then the following Bank fees are charged for provision and service of cards. Encashment: In case of AMD: 0.5% In case of USD: 0.3% |
|
| List of necessary documents to be submitted to the Bank |
|
|
Business loans with pledge of gold
| Loan currency and amount | The loan is provided in AMD, USD, Euro. The loan is provided in the following amount:
|
|---|---|
| Maturity, procedure of repayment of the loan and interest amount |
|
| Interest rate | Is approved by the Bank’s Management Board.
in case of loans with maturity longer than 60 months, as a rule, the interest rate for the loan is fixed only for the first 3 years of lending |
| Fines and penalties |
The provisions related to penaltiles and sizes thereof are specified in the contracts/agreements signed with the client. |
| Security | Pledged jewellery |
| List of necessary documents to be submitted to the Bank |
|
Loans for (start-up) business
| Clients | The loan is intended for start-up business |
|---|---|
| Loan currency | USD, Euro |
| MAximum limit of the loan amount | USD 100,000 or its equivalent in Euro |
| Annual interest rate | Is approved by the Bank’s Management Board. |
| Loan maturity | Maximum 5 years, depending on the purpose of the loan |
| Security | Means of security is pledge of highly liquid real estate acceptable for the Bank at the given moment. The loan amount cannot exceed 50 percent of the liquid value o the pledged property. |
| Other conditions | Three to six months after loan disbursement the Bank conducts monitoring of target usage of the loan funds. Depending on the results of monitoring, as well as taking into account the results of business development during this time period, the loan currency and interst rate can be changed, according to the conditions of the applicable business loans acting at the time of monitoring for similar business loans, and the interest rate and loan currency can be adjusted to the loan conditions only at least six month after loan disbursement. |
| Required documents | For review of this type of loans, the Bank can demand a business plan from the client. Other documents are submitted according to the list specified by this Regulation. |
| Commission fees | The Bank can set fees for review of the loan application or other payments, by decisions of the General Credit Committee or the Management Board. |
Fast loans for replenishment of the working capital
(maximum equivalent to AMD 20 million)
| Borrower | Clients of the Bank's commercial financing, who are the Bank's existing clients, didn't have liabilities overdue for more than 3 successive days and 12 days in total while servicing financing during the latest 2 years and were not classified |
|---|---|
| Financing instrument, currency and amount | Loan, credit line, overdraft Financing is provided in AMD, USD, Euro Maximum amount – in case of loans with annuity repayment, up to 80% of the principal loan amount repaid at the Bank In case of overdraft, up to 40% of the principal loan amount repaid at the Bank |
| Maturity, procedure of repayment of the loan and interest amount |
|
| Interest rate | Is approved by the Bank’s Management Board. |
| Security | Collateral items pledged within the framework of the acting credit liabilities |
| Other conditions | The loan is approved by the respective approving body on the basis of the financial monitoring conducted by the CFD and the ACRA inquiry, in case of availability of the security department's opinion regarding reliability of the client. The CFD presents the data of the clients compliant with the conditions of the given loans for the opinion of the security department in form of a list. The Legal Department isn't involved in the process of approval of these loans, except for registration of the collateral item pledged for the new loan. |
| List of necessary documents to be submitted to the Bank | Application reference on debts issued by the tax inspection |
| Commission fees | The Bank can set fees for review of the loan application or other payments, by decisions of the GCC or the Management Board. |
The costs related to evaluation, insurance, notarization of the property and its registration in the authorized body are paid by the client.
In case of using auxiliary services, the price of the services /range of prices / is determined by the organization providing the service.
Attention:
Your property (house, car, etc.) can be confiscated according to the procedure specified by the law, if you fail to repay the interest and principal loan amount in time.
If you fail to repay the interest and principal loan amount in time, the information regarding you will be recorded in the credit register.