Page 32 - GEORptMay19.pdf

Profit of Georgian insurers doubles in 2018
of its former president Islam Karimov in 2016 and the appointment of his successor Shavkat Mirziyoyev.
TBC is not moving into Uzbekistan with a traditional banking model, although there will be “smart branches” so customers have somewhere to go. The bank intends to build up its business by offering its digital banking services – a low cost option that at the same time can be rapidly rolled out.
“We are going to offer our digital offering. We are the largest financial institution in the Caucasus and differentiate ourselves through our digital offering,” Giorgi Shagidze, TBC Bank’s CFO and deputy CEO told bne IntelliNews i n an exclusive interview.
TBC is looking to expand, but it is doing it in stages. After studying neighbouring markets, the bank is already expanding in Azerbaijan, where Georgian businesses are working closely, and after a year of studying the market it is now moving into Central Asia by entering the Uzbek market.
TBC is ignoring the already well-developed and very competitive Kazakh market, as Uzbekistan’s very backwardness is part of the appeal with a total retail loans to GDP ratio of 7.2% at the end of 2018.
The country has only been open to foreign investors for about two years, but with a young and fast growing population of 32.4mn it is already easily the biggest market in the region.
“We are going with a digital, not traditional, bank and Uzbekistan is a very attractive market. It is already undergoing fast change. Every time I go to Tashkent you can see the changes. There is a lot of momentum. Lots of good things are happening,” says Shagidze.
Banking penetration in Uzbekistan is a low but the IMF forecasts that the sector will become the largest in the region, says Shagidze. Internet and smartphone penetration is also low but also growing fast.
The acquisition is expected to increase the total number of users that the TBC Group and its subsidiaries are serving by more than 50% to 3.7mn, according to Vakhtang Butskhrikidze, CEO of TBC Bank.
While the main thrust of the strategy is a digital offering TBC will still open some 80 “smart branches” to support the growth of the business, which rely heavily on technology such as smart terminals where customers can access banking services using cards and PINs. “The branches will look more like an Apple Store than a bank,” says Shagidze.
The net profit of Georgia's insurance sector expanded by 107% to Georgian lari (GEL) 42.2mn ($15.66mn) in 2018, according to a report from the insurance supervision service.
The volume of insurance premiums attracted during the year was GEL542.2mn from direct insurance activities, compared to GEL441.4mn in 2017.
Insurance companies' assets amounted to GEL743.2mn and their capital was GEL221.6mn at the end of 2018. One year earlier, the company's assets were GEL580.2mn and their capital was GEL154.2mn.
As of 31 December 2018, 17 insurance companies were registered. Sixteen have life and non-life insurance licences, while one has only a non-life licence.
8.2 Central Bank policy rate
Georgia’s policy rate held at 6.5%
Georgia’s central bank held its benchmark interest rate at 6.50% percent on May 1, citing forecasts that suggest annual inflation will stay close to its 3% target this year. Annual inflation in March stood at 3.7% , up from 2.3% in February.
32 GEORGIA Country Report May 2019 www.intellinews.com