Page 32 - GEORptSep19

Georgia’s TBC Bank Group maintains rising profits in Q2 but profitability ratios weaken
Bank of Georgia Group Q2 net profit doubles on one-offs
Georgia’s TBC Bank Group has reported a second-quarter unadjusted net profit of GEL120.2mn ($41.4mn), up 17.3% y/y. Adjusted for one-off costs, the Q2 bottom line increased by 4.3% y/y to GEL125.0mn.
In the whole H1 period, the bank accumulated a net profit of GEL253.5mn, a gain of 26.8% y/y. In adjusted terms, the net profit rose 18.8% y/y to GEL258.3mn.
Total assets of the group—which includes major Georgian lender TBC Bank—amounted to GEL 17.28bn ($5.96bn) as of the end of June, up 27.2%y/y.
The adjusted return on equity (ROE) amounted to 21.5% in Q2, down from 24.9% in the same period a year earlier. The unadjusted return on equity amounted to 20.7%, compared to 21.3% a year ago.
Loans & advances to customers made in the first half rose 11% to GEL 582.9mn from GEL 526.4mn the year before.
The lender's net interest margin in the half worsened to 5.8% compared to 7.0% the year before.
"The pressure on net interest income was related to a continued impact of the regulation implemented in January 2019, that limits the ability of banks to lend money to higher-yield retail customers, an increase in minimum reserve requirements for foreign currency funds, as well as competition in interest rates," the lender explained in a press release.
"Despite recent board changes, we continue to operate in our usual manner capitalising on our leading market share, strong capital and liquidity positions and operational excellence for the benefit of our shareholders. I welcome the supporting statements made by the National Bank of the Georgia, European Bank for Reconstruction & Development and International Finance Corp in support of TBC," said chief executive Vakhtang Butskhrikidze.
Chairman Mamuka Khazaradze and deputy chairman Badri Japaridze stepped down from their roles after the Georgian public prosecutor charged the duo over transactions at the lender's banking subsidiary in 2007 and 2008. They stated that they had resigned to concentrate on fighting the charges, which they deny.
Bank of Georgia Group has reported its second-quarter net profit adjusted for one-offs at GEL111.1mn ($38.3mn), marking a rise of 7.3%
32 GEORGIA Country Report September 2019 www.intellinews.com