Page 29 - GEORptDec17

TBC Bank signs $30mn loan agreement with Austrian development bank
TBC Bank reports 29% jump in Q3 profitability
BGEO Group posts 20.3% drop in Q3 profit
structure of the products will allow TBC Bank to accelerate financing of Georgian MSME and small mid-caps through reducing credit risk. The introduction of guarantee facilities to the Georgian financial sector is an important trigger to foster further growth of the economy and support MSME development”.
TBC Bank and other Georgian lenders have received financing from other multilateral development banks, such as the European Bank of Reconstruction and Development and the Asian Development Bank, to support SMEs in the country.
Meanwhile, TBC Bank has signed an agreement with the Austrian Development Bank, OEEB, for a $30mn loan to finance micro, small and medium enterprises (MSMEs) in rural areas, which are active in tourism or owned by women.
TBC Bank has previously signed similar agreements with other multilateral development banks (MDBs), including the European Bank for Reconstruction and Development (EBRD) and the Asian Development Bank (ADB). Promoting tourism, particularly in rural areas, is an approach the Georgian government has taken to create jobs and help boost growth in disfavoured regions.
Furthermore, making financing available for women-led and women-owned businesses in the country has constituted the subject of several agreements between MDBs and Georgian banks.
TBC Bank has reported a 29% increase in third-quarter net profit to GEL88mn ($32.8mn) thanks to strong growth in lending.
The bank, which overtook Bank of Georgia to become the largest in the country following the acquisition of Bank Republic from France's Societe Generale last year, also reported a return on equity above its target of 20%, a 33.2% y/y growth in its loan portfolio (55.2% with Bank Republic) and a 43.1% rise in its deposits. Meanwhile, non-performing loans stood at a manageable 3.5% of its lending portfolio.
The bank's performance was buoyed by strong economic growth in Georgia and was reflected in a credit rating upgrade issued by Moody's Investor Service during the quarter.
Georgia's BGEO Group, which owns the second largest lender in the country, announced a 20.3% drop in its third-quarter profits to GEL112.8mn ($43mn) on November 8.
The group's banking operations - comprising of Bank of Georgia, which is listed on the London Stock Exchange, as well as corporate investment banking and a Belarus-based lender - account for 49% of its capital. It also owns an investment arm consisting of operations in real estate, healthcare, insurance and energy. BGEO Group plans to split its investment and banking businesses.
The decline in profitability took place despite a 22.6% q/q rise in revenues to GEL330.4mn.
Meanwhile, Georgia Healthcare Group (GHG), BGEO Group's pharmaceutical
29 GEORGIA Country Report December 2017 www.intellinews.com