Page 37 - GEORptJun20

Georgia’s central bank, EBRD open swap line for mutual support
The central bank said that its policy of building up FX reserves in recent years has paid off, implying that the reserves would permit it to continue with interventions.
The European Bank for Reconstruction and Development (EBRD) and Georgia’s central bank (National Bank of Georgia, or NBG) have set up a US dollar-Georgian lari (GEL) foreign exchange (FX) swap facility, enabling the former to secure reliable access to GEL liquidity and continue lending in local currency to companies that are experiencing temporary difficulties.
The parties executed the first transaction on 24 April.
The foreign exchange swap line will support the management of NBG’s FX reserves with additional USD liquidity, which the central bank can draw on when need be.
The NBG made its latest intervention on the foreign exchange market on April 27 by selling $20mn to smooth exchange rate volatility.
The EBRD has expanded its response and recovery programme addressing the coronavirus (COVID-19) crisis and it expects the entirety of its investments of up to €21bn in the two years ahead to be dedicated to this effort. The package includes a €4bn Resilience Framework for existing clients, offering liquidity support, short-term working capital and trade finance. The EBRD emphasised that it was also ready to deploy its capacity to provide local currency lending.
37​ GEORGIA Country Report ​June 2020 ​ ​www.intellinews.com