Georgian banks may finish 2020 with losses
BAKU, Azerbaijan, May 28
By Tamilla Mammadova – Trend:
It is possible that the banks in Georgia will end the year of 2020 with losses, President of the National Bank of Georgia Koba Gvenetadze said at a press-conference, Trend reports citing Georgian media.
According to him, the crisis of COVID-19 was met by the Georgian banking system with a high rate of profitability and adequate level of capital, but despite a good starting position, it is possible that the total loss in the sector will be much higher than profit.
"Given the stable operating income, it is expected that after the pandemic, the banks and financial institutions will soon regain profitability," said Gvenetadze.
The share of inactive loans in the Georgian banking system in 2020 will grow. At the same time, the annual growth rate of loans is projected from 0 to 5 percent, he added.
Meanwhile, in the first four months of 2020, 15 commercial banks operating in Georgia lost a total of 667 million lari ($208.4 million).
As of May 1, 2020, the banking sector in Georgia is represented by 15 commercial banks, including 14 foreign-controlled banks. The total assets of Georgian commercial banks (in current prices) decreased by 1.01 billion lari ($317.4 million) or by 2.01 percent in April 2020, compared to the previous month, and constituted 49.12 billion lari ($15.4 billion).
The banking sector’s equity capital stands at 5.05 billion lari ($1.5 billion), which makes up 10.29 percent of the commercial banks total assets.
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