Page 48 - GEORptNov21

8.1.5 Bank news
EBRD accelerates trade finance digitalisation with National Bank of Greece, Georgia’s TBC Bank and Nordea
Bank of Georgia publishes Q2 financials
The European Bank for Reconstruction and Development (EBRD) is stepping up its support for the digital transition of trade finance by facilitating test transactions between National Bank of Greece, TBC Bank in Georgia and Nordea on the we.trade digital trade platform. The tests will take place through we.trade’s Preview Offering Program, with a special focus on access to trade finance for small businesses.
The Preview Offering Program enables banks and clients around the world to participate in test transactions with we.trade member banks. Banks also receive extensive operational, information technology, sales and marketing, and legal and compliance consultancy services, tailored to their level of digitalisation.
we.trade is owned by 12 European banks, technology company IBM, and CRIF, a global commercial credit and business information provider. The platform is based on the Linux Foundation’s Hyperledger Fabric and runs on the IBM Blockchain Platform.
The EBRD has designated digitalisation one of three priorities under its current five-year strategy. As part of this approach, the development bank is partnering with digital solutions providers and banks to support digitalisation efforts in trade finance within and beyond the regions in which it invests. The introduction of inclusive digital solutions is critical to ensuring that local banks and their small and medium sized enterprise (SME) clients across the EBRD regions are not left behind in the digital transition, it said.
The EBRD is also working with the International Chamber of Commerce Banking Commission and the International Trade and Forfaiting Association to advance the adoption of legal frameworks to enable digital trade and trade finance.
Bank of Georgia has published its Q2 2021 financials. The lender, Georgia's second largest after TBC, previously swung back to profit in Q1.
Bank of Georgia announced that it has reinstated its dividend, declaring an interim dividend of GEL 1.48 per share, implying an annualised dividend yield of 4.6%. The bank said it will update its dividend policy later this year.
Net income totalled GEL 202mn in Q2 2021, up 76% y/y and 46% q/q, with 29.4% ROE, bringing H1 2021 earnings to GEL 341mn with 25.4% ROE. Core revenues were very strong, said analysts, with pre-provision operating income up 10% q/q in 2Q21. NII rose 30% y/y and 7% q/q, with NIM up about 30 bps q/q at 4.8% and guided to be stable for H2 2021. Fee income was seen as particularly impressive in Q2 2021, up 74% y/y (albeit from a low base) and 18% q/q.
Balance sheet growth was robust as the economy recovered and gross loans increased 5.5% q/q in constant-currency terms, while deposits added 4.4%. There was a net provision release in Q2 2021 (-0.7%), driven by recoveries on corporate loans, bringing H1 2021 cost of risk to 0.2%. NPLs fell from 3.6% to 3.5%, with coverage at 73%.
Opex rose 16% y/y and 13% q/q in 2Q21 and 9% y/y in 1H21, with a 36% cost/income ratio in H1 2021.
The capital ratios improved in Q2 2021, helped by strong profitability, with CET1 up 130 bps at 12.5 % (from 11.2%), Tier 1 at 14.4% (from 13.3%) and total CAR at 19.1% (from 18.6%). The minimums are 11.5%, 13.4% and 17.7%, respectively.
48 GEORGIA Country Report November 2021 www.intellinews.com