Real GDP up 2.1% y/y in May 2016
Georgia’s real GDP grew 2.1% y/y in May 2016, after 4.3% y/y growth in April 2016, according to GeoStat’s rapid estimates. In 5M16, output growth averaged 2.9% y/y (growth was 2.5% y/y in 5M15). Monthly rapid estimates are based on VAT turnover, fiscal and monetary statistics.
NPLs at 3.8% in May 2016
In May 2016, the loan portfolio grew 7.2% y/y, excluding the exchange rate effect (+2.3% y/y and -1.8% m/m in unadjusted terms), to GEL 15.2bn (US$ 7.1bn). Deposits grew 11.1% y/y, excluding the exchange rate effect (+5.6% y/y and -6.5% m/m in unadjusted terms), reaching GEL 13.5bn (US$ 6.3bn). NPLs stood at 3.8% in May 2016, up 0.4ppts y/y and up 0.2ppts m/m.
Current account deficit stood at 13.1% of GDP in 1Q16
Current account deficit narrowed to 13.1% of GDP in 1Q16 from 14.7% of GDP in 1Q15, decreasing 19.4% y/y in nominal terms to US$ 395.1mn, according to NBG. Merchandize trade deficit, traditionally the major contributor to deficit creation, remained almost flat y/y as exports (-12.4% y/y) and imports (-4.3% y/y) were both down. Positive balance in services and current transfers compensated 71.0% of trade deficit. Among services, tourism had the largest positive balance, increasing 15.7% y/y to US$ 354.5mn (11.7% of GDP). Net current transfers, the largest positive item of the current account, were up 47.0% y/y to US$ 462.1mn, on the back of 8.5x increase in the government sector transfers due to the international aid received for hepatitis-C elimination program. Net FDI, significant item for financing the current account deficit, amounted to US$ 333.4mn (11.0% of GDP, up 161.1% y/y). The largest investment inflows were directed to transport and communications sector.
Joint stock company Bank of Georgia announces tender offer and consent solicitation for its US$ 400mn notes due 2017
On 30 June, 2016 Joint Stock Company Bank Of Georgia launched the invitation to the holders of its outstanding US$ 400mn 7.75% fixed rate notes due 2017 to tender any or all of such notes held by the holder for purchase by the Bank of Georgia for cash. Total consideration offered of 105.75% comprises the tender offer consideration (102.75%) and the early tender premium (3.0%) for tender submissions made before the early redemption deadline of 14 July, 2016. The Offer begins on 30 June, 2016 and will expire on 28 July, 2016, unless the offer is extended or terminated.
