Page 40 - GEORptNov19

Bank of Georgia raises $50mn from Citi to finance trade
Georgia’s TBC Bank to “mirror” governance structure of parent group TBC Bank Group
the director of the company.
One of Georgia’s two large banks, Bank of Georgia, has announced that it has borrowed $50mn from global financial group Citi under an agreement signed between the Bank of Georgia and Citi in 2011. ​It is the third transaction between the parties under the Continuing Agreement for Reimbursement of Trade Advances (CARTA).
The financial resources will enable the bank to offer corporates and SMEs products for financing trade.
“I am pleased that the Bank of Georgia, together with its loyal partner, Citi, continues to work actively on trade finance. This enables us to further strengthen our position in trade finance and offer our customers tailored financial resources. Such financing is important for both corporate and SMEs who are actively involved in export-import transactions. Our goal is to remain a reliable financial partner for them,” said Bank of Georgia CEO Archil Gachechiladze.
Taking into account shareholders’ feedback, as well as its experience of the benefits in having the same individuals serving in non-executive roles for both TBC Bank Group (parent company) and TBC Bank (a major bank in Georgia), TBC Bank Group on August 13 introduced the "Mirror Boards" governance structure for both entities.
Following the decision of the former chairman and deputy chairman to step down from the board of directors of TBC Bank Group (TBC PLC)—the LSE-listed parent of TBC Bank—and the subsequent appointment of Nikoloz Enukidze as the new TBC PLC chairman, the board reviewed the governance structure of the TBC group of companies (the "Group"), taking into consideration the feedback from certain shareholders, the international financial institution (IFI) partners and other stakeholders, TBC PLC announced. Under the "Mirror Boards" governance structure, all non-executive members of the TBC PLC Board and the supervisory board of the TBC Bank (the "Supervisory Board") will be the same. Separately, the chairman of TBC PLC will also serve as the chairman of TBC Bank. Senior independent director ("SID") of TBC PLC will also serve as the SID of the bank.
The board said it believed that these changes would maximise efficiencies in the management and supervision of the Group's business and would add stability to the Group's governance. It was noted that the Board's structure would be consistent with the requirements of the UK Corporate Governance Code, including with respect to the independence of its chairman and there being a majority of independent non-executive members of the Board.
8.2 ​Central Bank policy rate
Georgian monetary policy rate tightened further by 1pp to 8.5%
Georgia’s central bank on October 23 raised its key refinancing rate by 1pp to 8.5%, thus continuing its efforts to curb inflation partly fuelled by expectations for imminent currency depreciation.​ The national currency remains undervalued, the central bank stated.
The future decisions of the committee will depend upon the speed of the neutralisation of exchange rate pressure stemming from the exchange rate depreciation. Georgia’s monetary authority has increased its policy rate by 2pp in three steps taken over the the past two months. It also intervened on the foreign exchange market by selling $40mn in August and the same amount of foreign currency in September to prevent volatility.
40​ GEORGIA Country Report​ November 2019 ​ ​www.intellinews.com