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Home / Banking / Bank of Georgia: 5-6 Commercial Banks Create Sufficient Competitive Environment

Bank of Georgia: 5-6 Commercial Banks Create Sufficient Competitive Environment

Bank of Georgia director general Kakha Kiknavelidze says that the number of commercial banks should decline to 5-6 ones from 16 commercial banks.

Minimum capital requirement amount is expected to increase in the future too. As a result, small commercial banks may disappear from the market. The process will be regulated in natural way, by the market, without regulations, Kakha Kiknavelidze said.

“Minimum capital requirement has risen to 50 million GEL. This requirement may further increase in the future. I believe 5-6 commercial banks will suffice for a small country like Georgia. Today we have two major commercial banks with 65-70% market share. Competition level is quite high due to offers and the trend of interest rates over the past 5 years, when interest rates declined by more than 5%”, Kakha Kiknavelidze said.

“This process should proceed in natural way, not by regulations”, Bank of Georgia director general noted.