Page 49 - GEORptNov21

TBC and EFSE sign $10mn equivalent GEL loan agreement
Georgian bank group TBC takes full control of my.ge platform
2Q21 earnings of Georgia’s TBC Bank saw robust growth of 64% q/q
TBC Bank Group PLC announced in a press release on October 25 that its subsidiary, JSC TBC Bank, has signed a loan agreement in the amount of $10mn equivalent in GEL with The European Fund for Southeast Europe (EFSE). The facility will finance investments and the working capital needs of Georgian micro small and medium-sized businesses.
The founders of Georgian online platform my.ge, which includes specialised websites such as myauto.ge, myhome.ge, mymarket.ge and myjobs.ge, sold their 35% stake to TBC in September. The TBC Ecosystem Company, a subsidiary of TBC Bank Group, previously paid GEL19.45mn ($7mn) for a 65% stake back in 2019.
Giorgi Chumashvili, director of TBC Ecosystem Company, is currently director of My.ge, according to documents quoted by Business Media.
"Thanks to the TBC team for expressing confidence in the company and we are confident that with this team the company will achieve great success in the region and abroad," Kakha Gigitelashvili, one of the two founders, said in a Facebook post.
My Group, which operates the my.ge platform, was founded in 2002 by Kakha Gigitelashvili and his brother Lasha.
The 2Q21 earnings of Georgia's FTSE-listed TBC Bank saw robust growth of 64% q/q to Georgian lari (GEL) 250mn, driven by a solid operating performance, a GEL 50mn net provision release and a GEL 26mn one-off gain from a property sale.
VTB Capital said: "The bank’s ROE was at 31.1%. However, normalized ROE remained at 22%, in our calculation, which is in line with TBC’s strategy and also BGEO’s performance in 2Q21. We also note the growth of the Uzbek business (+102% YoY growth in Payme total transactions volume to GEL 1.2bn). In our view, the results are positive and we leave our forecasts and 12-month Target Price of GBp 1,900 unchanged. Buy reiterated (51% ETR, including a 5% DY for interim dividend).
"NIM’s 47bp QoQ increase, driven by higher asset yields, helped NII to grow 7.8% QoQ. Net F&C income was up 39.1% QoQ, helped by the growth in domestic card and settlement operations and the contribution from the Uzbek Payme. Opex grew robustly on the back of the revival in economic activity and the growth of the Uzbek business. However, CIR stayed flat at 39%. The net loan loss provision recovery for GEL 50mn and one-off gain from selling the investment property sale for GEL 26mn pushed earnings up 64% QoQ to GEL 250mn, which implies 31.1% ROE. We estimate the normalized ROE at 21.8%, or in line with the Group’s strategy and 22.1% of Bank of Georgia Group."
8.2 Central Bank policy rate
Georgian central bank holds key rate at 10%
The Monetary Policy Committee of the National Bank of Georgia (NBG) on October 27 kept its key refinancing rate unchanged at 10% for a second time in a row, after raising it by 0.5% to its highest level in 13 years in August.
The central bank stressed that it is keeping the monetary policy stance tight, as increased inflation remains a challenge for Georgia. Noting that consumer prices increased by 12.3% in September, the NBG said it expected inflation to remain high through February 2022.
According to the central bank, the high inflation was mainly a result of one-off factors, such as significant increases in prices of food and oil on international
49 GEORGIA Country Report November 2021 www.intellinews.com