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LAW OF THE REPUBLIC OF ARMENIA

of December 21, 2004 No. ZR-142

About guaranteeing compensation on bank deposits of physical persons

(The last edition from 12-01-2016)

Accepted by National Assembly of the Republic of Armenia on November 24, 2004

The purpose of this Law is assistance to increase in reliability of bank system of the Republic of Armenia, trust of society to bank system and ensuring depositor protection.

Chapter 1. General provisions

Article 1. Subject of regulation of the Law

This Law governs the relations connected with guaranteeing in the amount of compensation established by the law on bank deposits of physical persons, including individual entrepreneurs.

Article 2. Bank deposit and the guaranteed bank deposit

1. In sense of this Law and other legal acts adopted based on this Law as bank deposit (further – bank deposit or contribution) are considered:

a) the sum of money provided to bank by the investor or the third party for benefit of the investor or available in bank which is subject to return and (or) payment to the investor;

b) money of the investor on the settlement, current, urgent, savings or other account opened in bank;

c) the money raised due to release of personalized securities by bank;

d) the amounts of percent added on the money provided by the Items "and", "b" and "v" of this part.

In sense of this Law and other legal acts adopted based on this Law the money provided to bank in the consent of the investor to acceptance of risk of its use or as property, or leases or acquisitions of rights of property rights of, either compensation for performance of work or rendering service is not considered as bank deposit.

In sense of this Law and other legal acts adopted based on this Law shares of all types, secured mortgage bonds, and also other securities certifying participation in the authorized capital of the legal entity are not considered as personalized security.

2. The guaranteed bank deposit (further – the guaranteed contribution) the bank deposit in dramas and foreign currency brought by the investor in bank in the amount of, the stipulated in Clause 3 presents of the Law is considered.

3. The bank deposit is not considered the guaranteed contribution:

a) which belongs to the head of this bank and (or) members of his family;

b) which belongs to person with considerable participation in this bank and (or) to members of his family;

c) the owner (co-owner) of which refused the property right to the part;

d) which in the procedure established by the law and other legal acts is recognized as the money acquired in the criminal way until its owner proves the return;

e) which is brought in this bank with the interest rate exceeding at the time of contributing interest rate of the similar bank deposits provided by the offer of this bank on the conclusion of the public agreement time 1,5 at least.

In sense of this Law and other legal acts adopted based on this Law the physical person (including the individual entrepreneur) having (having) contribution in bank is considered the investor.

In sense of this Law and other legal acts adopted based on this Law the contribution made addressed to two and more persons and concerning which two or more persons have the property right is considered joint bank deposit.

In sense of this Law the chairman of the board of bank (the chairman of the board of directors or the supervisory board), his deputy and members of council, the chief executive (chairman of the board), his deputy, board members, the chief accountant, and also the division manager performing internal audit are considered as heads of bank.

In sense of this Law the father, mother, the spouse (spouse), children are considered as members of one family.

In sense of this Law person with considerable participation person with considerable participation identified by the Law of the Republic of Armenia "About banks and banking activity" is considered.

4. The contributions made in the banks operating in the territory of the Republic of Armenia (except for its branches created outside the territory of the Republic of Armenia), and also in the branches of foreign banks created in the territory of the Republic of Armenia are guaranteed (further – bank).

Article 3. The sizes of the guaranteed contribution

1. The sizes of the contribution guaranteed in the procedure established by this Law, the following:

a) if the investor has in insolvent bank bank deposit only in dramas, then the size of the guaranteed contribution constitutes ten million Armenian drams;

b) if the investor has in insolvent bank bank deposit only in foreign currency, then the size of the guaranteed contribution constitutes five million Armenian drams;

c) if the investor has in insolvent bank bank deposits in dramas and foreign currency and the amount of bank deposit in dramas more than five million Armenian drams, then only the contribution in dramas – at the rate to ten million Armenian drams is guaranteed;

d) if the investor has in insolvent bank bank deposits in dramas and foreign currency and the amount of its bank deposit in dramas less than five million Armenian drams, then the bank deposit in dramas is guaranteed completely and bank deposit in foreign currency - in the amount of difference of five million dram and the bank deposit compensated in dramas.

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