BAKU, Azerbaijan, August 16
By Tamilla Mammadova – Trend:
Reopening of the economy and strong recovery has boosted loan growth markedly from April 2021 in Georgia, Trend reports via the leading investment bank in Georgia Galt and Taggart.
In its recent report, Galt and Taggart highlights that bank loan growth accelerated in both corporate and retail segments hinting at improved sentiments, making bank lending one of the factors supporting investment growth this year along with public infrastructure spending.
According to the report, the deposit growth decelerated from May, which hints at continued recovery in demand. Amid stronger currency, higher interest rates, and improved sentiments the deposit dollarization reduced to 60 percent in June 2021 (- 1.39 ppts year-on-year and -0.70 ppts months-on-months).
The loan dollarization also reduced to 52.4 percent (-4.07 ppts year-on-year and -1.55 ppts months-on-months) and NPLs remained low at 2.2 percent. The banking sector credit portfolio growth accelerated to 11.3 percent year-on-year and 12.6 percent year-on-year in May and June 2021, respectively, excluding FX effects, after single-digit growth in previous months.
Notably, newly issued mortgages surged by 115.2 percent year-on-year in June, bringing mortgages stock growth to 13 percent year-on-year, improving compared to previous months.
“Amid improved growth figure, we also revised bank lending growth forecast, and expect at 15-17 percent year-on-year in 2021 up from 5-10 percent projected initially,” says Galt and Taggart.
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