Page 47 - BNE_magazine_05_2019

bne May 2019 Eurasia I 47
Georgia’s leading commercial bank TBC moves into Uzbekistan Ben Aris in Berlin
attractive market. It is already undergo- ing fast change. Every time I go to Tash- kent you can see the changes. There is a lot of momentum. Lots of good things are happening,” says Shagidze.
For Georgians, the change that Uzbeki- stan is going through now is very familiar.
Internet and smartphone penetration is also low but also growing fast. There are 4mn smartphone users in Uzbekistan, which is a volume already bigger than that of the entire Georgian population, says Shagidze. And the penetration
of smartphones continues to expand rapidly. TBC’s partner Payme already has 1.3mn.
The acquisition is expected to increase the total number of users that the TBC Group and its subsidiaries are serving by more than 50% to 3.7mn, according to Vakhtang Butskhrikidze, CEO of TBC Bank.
The biggest bank in Georgia TBC is moving into Uzbekistan following the acquisition of a local payment service called Payme. It is purchasing
a 51% stake in the fintech company for $5.5mn, the bank announced.
The idea is to roll out TBC’s digital banking offering and tap into the Uzbek population, by far the largest in Central Asia, while the country rapidly opens to the rest of the world following changes that have followed the death of its former president Islam Karimov in 2016 and the appointment of his successor Shavkat Mirziyoyev.
“TBC announces that it has entered into an agreement to acquire a 51% stake
in LLC Inspired, a leading payment platform in Uzbekistan trading under the Payme brand,” the bank said in its official announcement of the deal.
TBC is not moving into Uzbekistan with a traditional banking model, although there will be “smart branches” so customers have somewhere to go. The bank intends to build up its business by offering its digital banking services –
a low cost option that at the same time can be rapidly rolled out.
“The branches will look more like
an Apple Store than a bank,” Giorgi Shagidze, TBC Bank’s CFO and
deputy CEO told bne IntelliNews in an exclusive interview. “We are the largest financial institution in the Caucasus and differentiate ourselves through our digital offering.”
TBC is looking to expand, but it is doing it in stages. After studying neighbouring markets, the bank is already expanding in Azerbaijan, where Georgian business-
es are working closely, and after a year of studying the market it is now moving into Central Asia by entering the Uzbek market.
TBC is ignoring the already well- developed and very competitive Kazakh market, as Uzbekistan’s very backward- ness is part of the appeal with a total retail loans to GDP ratio of 7.2% at the end of 2018.
The country has only been open to for- eign investors for about two years, but
“We are the largest financial institution in the Caucasus and differentiate ourselves through our digital offering”
with a young and fast-growing popula- tion of 32.4mn Uzbekistan is already easily the biggest market in the region.
“We are going with a digital, not tradi- tional, bank and Uzbekistan is a very
“Georgia has already been through these reforms and we know what it means. There are Georgians advising the government and we take these ideas to the business meetings too,” said Shagidze.
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