NPLs at 3.7% y/y in April 2017
In April 2017, the banking sector loan portfolio increased 13.3% y/y after growing 13.0% y/y in previous month, excluding the exchange rate effect. In unadjusted terms, loan portfolio was up 22.3% y/y and 0.6% m/m to GEL 18.9bn (US$ 7.7bn). Deposits were up 6.2% y/y excluding the exchange rate effect. In unadjusted terms, deposits were up 12.3% y/y and up 0.8% m/m to GEL 16.2bn (US$ 6.6bn). Deposit dollarization reached 68.7% (-0.8ppts y/y and -0.5ppts m/m). NPLs stood at 3.7% in April 2017, up 0.2ppts y/y and flat m/m.
Unemployment rate at 13 year low
In 2016, the unemployment rate in Georgia fell by 0.2ppts y/y to 11.8% (13 year low), according to GeoStat. Out of employed persons, the share of hired labor stood at 745.4 thousand persons (-1.1% y/y) and accounted for 42.3% of total, while 1.0mn persons (-0.7% y/y) were self-employed accounting for 57.3% of total.
Bank of Georgia inaugural debt issuance – GEL 500mn due 2020
On 24 May 2017, BGEO Group PLC’s banking business subsidiary, JSC Bank of Georgia successfully priced an inaugural GEL 500mn offering of 11.00% notes due June 2020. The Notes are denominated in GEL and are expected to settle on 1 June 2017. J.P. Morgan and Renaissance Capital are acting as Joint Bookrunners for the Notes, and Galt & Taggart is acting as a Co-Manager. Dechert LLP and Baker & McKenzie LLP are acting as legal advisors to the Joint Bookrunners and the Bank, respectively. The Notes are expected to be listed on the Irish Stock Exchange and to be rated BB- (Fitch) and Ba3 (Moody’s). On closing, the issuance is expected to be the first international local currency bond offering from the wider CIS region (excluding Russia) in the past ten years and represent a landmark transaction for Georgia.
