Page 42 - GEORptNov21

8.0 Financial & capital markets
Georgia - Commercial banks lead Q3 2021 Q2 2021 Q1 2021 2020 2019 2018 2017 2016 indicators (end of period)
Interest income (GEL mn)
404.22 384.79 380.63 381.66 339.90 296.86 275.70 227.44
Net profit / loss (GEL mn)
171.16 294.63 145.49 100.73 132.02 119.10 152.56 112.52
Bank assets (GEL mn)
58,572.80 55,980.68 58,154.42 56,870.98 47,183.37 39,682.98 34,593.50 30,149.32
Bank deposits (GEL mn)
28,795.78 26,704.69 28,198.20 26,647.00 21,135.84 17,907.06 15,514.39 13,514.88
Bank loans (GEL mn)
40,145.13 38,398.41 38,231.78 37,374.29 31,078.64 25,918.14 21,761.90 18,512.30
ROA (%)
4.1% 4.0% 2.8% -2.5% 2.5% 3.0% 3.1% 3.1%
ROE (%)
37.3% 37.3% 27.8% -20% 20.3% 23.3% 23.3% 22.1%
CAR (%)
19.1% 19.2% 18.2% 17.6% 19.0% 18.4% 19.1% 15.1%
NPL to total gross loans (%)
Source: National Bank of Georgia
6.0% 6.7% 8.3% 8.2% 4.4% 5.5% 5.9% 7.3%
8.1 Bank sector overview 8.1.1 Earnings
Georgian banking sector sees monthly net profit surge 2.4x y/y in August
Georgia’s banks boast biggest profits ever in June
The National Bank of Georgia (NBG) released the August results for the country's banking sector under local standards on September 27, according to a note by Sova Capital.
Monthly net profit surged 2.4x y/y and 31% m/m, as strong growth in core revenue was combined with the second-largest monthly reversal in loan loss provisions this year.
Monthly NII expanded 48% y/y, as the 16% y/y growth in gross loans was coupled with NII surging more than 1ppt y/y. The latter was likely driven by NBG's rate hikes, as the policy rate rose from 8% in mid-2020 to 10% in early August. Net fees added 20% y/y in August, and FX gains less losses soared 87% y/y as the economy (tourism in particular) rebounded.
In turn, Georgian banks reversed GEL 41mn in loan loss provisions in August, the second-largest reversal in loan loss provisions this year after the figure of GEL 96mn in June. The coverage of overdues with provisions remained at the same level as in July at around 4x.
The monthly y/y growth in opex in August (+18%) was well below the monthly growth in revenue, pulling down the banking sector's C/I ratio to 55%. This was the lowest level seen during the period of 2020-8M21.
The aggregated net profit of Georgia's banks more than doubled in June compared to the same month last year, to Georgian lari (GEL) 295mn ($92mn) - it amounted to the biggest profit ever recorded by the banks in the country’s history.
42 GEORGIA Country Report November 2021 www.intellinews.com