Page 30 - GEORptSep18

Economic and Financial Affairs Masoud Karbasian in a meeting with Georgian business officials in Tbilisi. It was part of a wider business trip arranged by the Iran-Georgia Friendship Group, a business lobby aimed at facilitating trade between the two near neighbours.
The Georgian side reportedly welcomed the proposal. But the recent banking difficulties experienced by Iranians in Georgia may indicate that a spanner is going to get firmly lodged in the wheels of any potential deal.
Reports have previously stated that Iran was on the way to connecting its banking system with those of other countries including Russia, Azerbaijan, Oman and Qatar, but delays and supposed "technology issues" have hampered any further development of banking integration with those neighbours.
In the case of Russia, it was first announced that the connection would be achieved by January this year. Then it was suggested that it would occur by the time of the June start of the Russia 2018 World Cup. But Iranian football fans who have journeyed to Russia for the tournament have told media outlets that their bank cards fail to work in the country’s ATMs.
According to several Iranian residents of Georgia, all Iranians in the country, bar those working for foreign media, are only permitted to open Georgian lari accounts. Also, the account holders are not permitted to conduct international banking transactions in other foreign currencies as that might breach US Treasury banking regulations and sanctions.
8.1.6 Bank news
Underlying net profit of Georgia’s TBC Bank improves 38.8% y/y in second quarter
Georgian lender TBC Bank on August 20 reported an underlying net profit of Georgian lari (GEL) 119.9mn, a 38.8% gain on what was recorded a year ago. Its reported net profit amounted to GEL102.4m versus GEL79.9mn in the same period of 2017.
The underlying return on equity (ROE) amounted to 24.9%, against 20.4% in 2Q17. The percentages for the underlying return on assets (ROA) were 3.7% versus 3.2%, TBC added.
Total operating income was GEL 258mn, up by 24.8% y/y. Cost to income was 35.6% against 44.9% 12 months’ back.
TBC also gave the net interest margin (NIM) percentages as 7.1% versus 6.8% and the risk adjusted net interest margin (NIM) percentages as 5.5% versus 5.3%.
As of 30 June, TBC’s total assets amounted to GEL13,584mn, up by 20.4% y/y. Gross loans and advances to customers stood at GEL8,896mn, up by 20.4% y/y.
Net loans to deposits + IFI funding stood at 89.5% and the Net Stable Funding Ratio (NSFR) was 127.8%. NPLs were recorded at 3.1%, down by 0.3pp y/y. NPLs coverage ratios stood at 116.1% or 216.1% with collateral as of 30 June compared to 84.3% or 219.3% with collateral as of 30 June 2017.
Total customer deposits stood at GEL7,933mn, a gain of 19.0% y/y.
Also as of 30 June 2018, the Bank’s Tier 1 and Total Capital Adequacy Ratios (CAR) per the new NBG methodology stood at 13.4% and 17.0% respectively, while minimum requirements amounted to 10.2% and 15.6%.
In its overview of market shares, TBC said its market share in total assets reached 37.1% as of 30 June, up by 0.8pp y/y.
30 GEORGIA Country Report September 2018 www.intellinews.com