“ACBA BANK” open joint-stock company goes back to the best traditions of european banking and corporate governance. Founded in 1996 with the joint efforts of the French Crédit-Agricole and the Dutch Rabobank and later involving the French Crédit-Agricole Bank as one of its shareholders ACBA Bank consistently made its efforts to import the values and practice of european business world into the Armenian banking system. The management of the Bank, which has constantly improved, striving to ensure the best international standards, was not left outside of it. As a pledge for its chosen values, ACBA Bank has committed to continue the process of developing its corporate governance system.

Corporate governance determines the allocation of authority and responsibilities by which the business and affairs of the Bank are carried out by its board and senior management (i.e. the chief executive officer of the Bank and the deputies), including how they:

• set the Bank’s strategy and objectives;
• select and oversee personnel;
• operate the Bank’s business on a day-to-day basis;
• protect the interests of depositors, meet shareholder obligations, and take into account the interests of other recognised stakeholders;
• align corporate culture, corporate activities and behaviour with the expectation that the Bank will operate in a safe and sound manner, with integrity and in compliance with applicable laws and regulations; and
• establish control functions.

The primary objective of corporate governance should be safeguarding stakeholders’ interest in conformity with public interest on a sustainable basis. Among stakeholders, particularly with respect to retail banks, shareholders’ interest would be secondary to depositors' interest.

The Bank realizes that good corporate governance can generate the following competitive advantages:

• greater access to external financing, which can lead to greater investment, greater growth, and employment. Nowadays, local and international investors often avoid companies that do not guarantee the rights of investors, do not ensure the proper disclosure of corporate information and reliable Board activity;
• lower cost of capital and higher cost of the Bank, which increase investment attractiveness;
• better operational performance through more efficient assignment and better management of resources;
• lower risks;
• better relations between all stakeholders, which improves labor relationships, as well as the atmosphere related to social aspects, such as the protection of the environment.

Until August 2024, the Bank applied its internally developed Corporate Governance Code, which had been based on the principles of the OECD, Basel Committee on Banking Supervision, and the UK Corporate Governance Code. Following the entry into force of the Corporate Governance Code of the Republic of Armenia in late August 2024, the Bank transitioned to applying the Armenian Code and discontinued use of its internal code.

The Board of the Bank approved the establishment of the following 3 Board committees on 02.11.2022:

• Audit committee,
• Risk Management committee,
• Governance, Nominations and Remunerations committee.

At its meeting of 17.10.2024 the Board of the Bank established a new Board committee: Strategy committee.

The Board committees are chaired by the independent Board members.

Regulations

Board regulation