Entering into repo / reverse repo transactions

Counterparty	Financial organizations controlled and licensed by the CBA of RA (investment companies, credit organizations, insurance companies, investment funds),
Securities	Securities defined by the Central Bank of the Republic of Armenia, the list of which is published daily on the website of the Central Bank of the Republic of Armenia. Bonds issued by RA banks
Interest rate	Transaction interest rates are formed taking into account: the Bank's liquidity level, the necessary level of dram funds required for the management of mandatory reserve norms, the maturity of the transaction, the volume of the transaction, the interest rates of the transactions concluded during the previous day published by the Central Bank of Armenia according to maturity, the general repo market trends and expectations, the given the type of activity of the counterparty company and the history of the Bank's business relations with it. The interest rate is mainly formed by the refinancing rate of the Central Bank of Armenia ± a minimum of 0.5%.
Haircut	A haircut is applied to the transactions according to the limits established in the Bank. Depending on the maturity and the type of securities subject to the repo/reverse repo transaction, the haircut may be applied to the market value of the security, varying up to around 5.0% to the yield curve.
Other terms	The decision to conclude a transaction is influenced by the bank's liquidity position and expectations, the partner's business reputation, the history of business relations with the bank, the situation and expectations in the financial market, and other factors.

1 Terms of transactions with RA resident and non-resident banks and other non-resident financial organizations are determined through negotiations.