Real GDP growth was 18.7% y/y in June 2021
Georgia’s economy grew by 18.7% y/y in June 2021, bringing GDP growth to 29.8% y/y in 2Q21, based on Geostat’s rapid estimates. Notably, real GDP of June 2021 was also up by 9.5% compared to June 2019 level. Overall, in 1H21, real growth was 12.7% y/y (+5.7% compared to 1H19). In June, growth was broad-based with economic activity up in manufacturing, financial and insurance, transport, trade, hotels & restaurants, real estate and construction sectors. Meanwhile, growth was down only in mining sector. Monthly rapid estimates are based on VAT turnover, fiscal and monetary statistics.
NPLs at 2.2% in June 2021
In June 2021, the banking sector loan portfolio growth came in at 12.6% y/y (+1.7% m/m), excluding FX effect, after a 11.3% y/y growth in previous month. In unadjusted terms, loan portfolio was up 16.0% y/y (-0.8% m/m due to GEL appreciation), amounting to GEL 39.2bn (US$ 12.4bn). By sector, loan growth accelerated further in both corporate and retail segments to 11.0% y/y and 14.2% y/y, respectively (exc. FX effect) in June. Notably, newly issued mortgages increased by 115.2% y/y, bringing mortgages stock growth to 13.0% y/y, after a 12.3% y/y growth in previous month (exc. FX effect). In June 2021, loan dollarization reduced to 52.4% (-4.07ppts y/y and -1.55ppts m/m) and NPLs stood at 2.2% (-0.16ppts y/y and -0.11ppts m/m).
Bank deposits growth slowed to 17.0% y/y (-0.1% m/m, exc. FX effect) to GEL 34.5bn (US$ 10.9bn) in June 2021. By currency, GEL deposits growth slowed to 24.4% y/y and FX deposits slowed to 12.4% y/y (exc. FX effect). The deposit dollarization stood at 60.0% (-1.39ppts y/y and -0.70ppts m/m).
Tbilisi residential property price index up 10.1% y/y and down 0.4% q/q in 2Q21
Residential property price index (RPPI) was up 10.1% y/y in 2Q21, after a 13.6% y/y growth in previous quarter, according to Geostat. Notably, prices increased in both segments, with prices up by 17.9% y/y for detached houses and by 7.5% y/y for flats. On a quarterly basis, price increased by 2.2% q/q for detached houses, while it reduced by 1.3% q/q for flats, which led to a 0.4% q/q drop in total RPPI in 2Q21.
