Individual INVESTMENT Loan

Loan purpose

• Obtaining equity share in legal entities whether Armenia-based or outside Armenia, via purchase of their shares/stocks for involvement in commercial activity allowed by Armenian law and regulations, whether in or outside Armenia,
• Acquisition of movable and real property outside Armenia in order to gain profit^[1].

Eligibility

RA resident individuals and non-residents aged 18 – 63, who during the entire period of loan service will not turn  63, otherwise the loan will be shared by a co-borrower who  meets these requirements.

Loan currency

• AMD
• USD
• Euro

Loan amount

AMD 16,000,000 – AMD 350,000,000

USD 40.000 – USD 700.000

Euro 40.000 – Euro 700.000

Type of limit

Line of credit^[2]

Loan with a specified repayment schedule

Repayment method

Non-revolving line of credit

Overdraft

«Annuity» scheme

«Flexible» scheme

Repayment period

For fixed interest rate

12 - 84 months

For floating interest rate

60 - 240 months

Annual (fixed) interest rate

Nominal

Maximum actual^[3]

AMD

15.0%

17.2%

USD

10.0%

10.5%

Euro

8.5%

8.3%

Annual (floating) interest rate

Nominal rate

Maximum actual rate

AMD

Starting at 14.0% (fixed component – starting at 5.0% + variable component)

14.4%

USD

Starting at 9.2% (fixed component – starting at 8.2% + variable component)

9.6%

Euro

Starting at 7.5%  (fixed component – starting at 7.5 % + variable component)

8.0%

Maximum and minimum range of fluctuation of the floating interest rate

+4%, but not more than 21%

The variable component of the floating rate will be revised starting the first due date following the 24-month period after the loan origination and every 6 months afterwards using the interest rate (published on the website) applicable in the Bank at the time of revision.

Procedure for calculation of floating interest rate

Other interest rate terms

Loans deviating from credit rating terms and conditions (without creditworthiness assessment) or other terms of standard loans may be advanced at interest rates 0.5%-1% higher than the applicable interest rates.

Penalty for loan prepayment

For refinancing of the loans granted both by other Armenia-based and non-resident banks, credit organizations or other financial institutions - if prior to the end of the first half of the contract period the principal amount is prepaid in full or in part, the borrower must pay a penalty of 3% of the prepaid principal amount.

Penalty charged for late payment of the principal and interest amounts

For past due principal amount - 0.015% per day,

For past due interest - 0.1% per day.

Loan disbursement method

Non-cash;

For overdraft – transferring the loan amount to Bank’s payment card account.

Loan security

Real property located in RA and accepted by the Bank, as well as vehicles, cash, including deposits, bonds (issued by Evocabank CJSC or the RA Government and maturing not earlier than the date of expiry of the loan agreement). Apart from real property collateral, the loan may be secured by a surety bond of an individual or legal entity.

Loan-to-value ratio

Pledging of movable or real property acceptable by the Bank, in which case the loan-to-value ratio will be calculated as follows:

Real property  - up to 70% of appraised value (without income justification - 50%^[4]);

Vehicles – up to 70% of appraised value, for loans with repayment period exceeding 60 months - the part of the collateral secured by vehicle should not exceed 50% of the collateral value in loan-to-value ratio.

The Loan-to-value ratio will be calculated for cash in the following manner:

If the currency of the collateral is the same as that of the loan – 95% of the term deposit;

If the currencies of the collateral and loan are different – up to 80% of the term deposit;

If the currency of the collateral is the same as that of the loan – up to 80% of par value of purchased bonds;

If the currencies of the collateral and loan are different – up to 70% of par value of purchased bonds.

Creditworthiness assessment

Customer’s credit rating will be assessed as prescribed under with the Bank’s Individual Lending Procedure;

Insurance

In individual cases, subject to the collateral type, the pledged property should have insurance coverage.

Each year, at outstanding loan balance

Fees and charges

• 0.5% of the loan amount, but not less than AMD 50.000.
• If the loan amount is cashed, a cash withdrawal fee should be charged according to the Bank’s fees.

Timeline for making decision on loan application approval or rejection

• The decision on approving or declining the loan application will be made within 10 (Ten)  business days upon submission of the entire package of required preliminary documents.
• The loan will be provided within 2 (Two) business days after the approval of the loan application and completion of property pledging procedure.

Other provisions

• The loan application will be declined if the purpose of expected funds contradicts the Bank goals or terms outlined in the Bank’s financial and tax policy ՖՀԿ քաղաքականություն.
• Loans maturing after 120 months will be granted for acquisition of real property abroad.
• In individual cases, based on the Bank's decision, a grace period of up to 12-month may be granted for the loan principal repayment.
• For a line of credit or overdraft, the Bank may decide to set a mandatory repayment schedule as well as annual interest rate of up to 1% for the unused portion.
• In individual cases, the Bank may additionally request pledging the equity/property to be acquired, meanwhile the pledged asset located outside Armenia cannot be included in calculation of the Loan-to-value ratio.
• If the equity interest to be acquired is a part of equity of an Armenia-based organization, the credit history as well as existence of other liabilities (tax debt, lawsuit, etc.) of that entity may be  examined.
• The Bank will implement target monitoring to verify the intended use of the loan while the borrower will provide the Bank with timely and accurate information and ensure other conditions. The first target monitoring will be implemented by the competent body within the set timelines, thereafter target monitoring will be implemented regularly on an annual basis.
• Upon the Bank's request, the borrower will provide the Bank with necessary information justifying the intended use of the loan proceeds (agreements, contracts and other documents). If the Bank identifies deviation from intended use of the loan, it will be entitled to declare the outstanding principal loan balance and all accrued interest due and payable in full.