BAKU, Azerbaijan, Apr.7
By Tamilla Mammadova – Trend:
The Georgian National Bank's (NBG's) decision to increase refinancing by 50 basis points to 8.5 percent in March resulted in the increase of banks' interest towards the government bonds, said Aleksandre Dzneladze, President of the Banking Association, Trend reports via Georgian media.
"Refinancing rate growth is increasing the interest rate on securities, which grows the demand on them. In general, there has never been a low demand for these securities, but I think it will increase further," he said.
Georgian government took the domestic debt of 35 million lari ($10.2 million) on April 6, while the banks wanted to buy 91 million lari ($26.7 million) worth of securities.
The Government takes domestic debt from the local economy by issuing treasury bonds. The financial resource is purchased by commercial banks from the state. Along with the increase of the refinancing rate by the NBG, the domestic debt of the state has become more expensive.
---
Follow the author on Twitter: @Mila61979356