Georgia sees increase in volume of overdue loans

Finance Materials 1 December 2020 15:47 (UTC +04:00)
Georgia sees increase in volume of overdue loans

BAKU, Azerbaijan, Dec. 1

By Tamilla Mammadova – Trend:

Volume of overdue loans has increased by 47.1 million lari ($14.2 million) in October in Georgia and amounted to 570.2 million lari ($172.4 million), Trend reports via the National bank of Georgia (NBG).

According to the NBG, their share in commercial banks' credit portfolio was 1.5 percent.

It’s worth mentioning that 30.4 percent of the overdue loans are denominated in the national currency.

In the reporting period, the dollarization rate of the total loan portfolio increased by 1.3 percentage points to 55.7 percent.

The total assets of Georgian banks have increased by 18 percent year-on-year despite the economic crisis and amounted to 54 billion lari ($16.3 billion). However, banks’ revenue from the issued loans has grown as well, which amounted to 2.9 billion lari ($877 million) in 9 months.

In 2019, this figure was 2.7 billion lari ($816.5 million), although the net profit of banks has deteriorated sharply. In total, all fifteen commercial banks lost 252 million lari ($76.2 million) instead of profit.

However, the main determinant of the existing losses is accumulation of 1.2 billion lari (362.9 million) in the expected credit loss reserve.

As of November 1, 2020, the banking sector in Georgia is represented by 15 commercial banks, including 14 - foreign-controlled banks. In October 2020, compared to the previous month, the total assets of Georgian commercial banks (in current prices) decreased by 427.12 million lari ($129.5 million) and constituted 53.92 billion lari ($16.3 billion).

The banking sector's equity capital equals 5.63 billion lari ($1.7 billion), which makes up 10.44 percent of the commercial banks total assets.


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