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EBRD: GEORGIAN BANKS EMERGE AS REGIONAL LEADERS IN TRADE SECTOR CREDITING

TBC Bank has hosted a one-day conference as part of the trade support program of the European Bank for Reconstruction and Development (EBRD).

The conference made focus on trade sector crediting on international and regional markets. The meeting also discussed the bank sector challenges with leading specialists, regulators and lawyers.

The Georgian bank sector is developed very well and the trade sector crediting ratio in the bank sector’s portfolio is impressive, EBRD representative Kamela Mahmudova said.

“We want to continue our relations with Georgian banks and to supervise how the trade sector crediting product is developed. EBRD wants to have partnership relations with Georgian banks. You have quite developed bank sector and the Georgian banks know how to work on the market. The main thing is that the clients get information what is the trade sector financing and what is the importance of this product for the economy development. Another issue is related to the current tendencies on the market. Unfortunately, the trade sector financing limits are closed. Problems are met in Azerbaijan, Armenia. The US banks have the same problems. Limits are closed, because, the risks have not been appraised valuably”.

The conference aims at assembling Caucasian banks, Kamola Mahmudova noted: “We have discussed the most relevant issues on the trade sector financing issues. The most active foreign banks were represented at the Tbilisi Conference. EBRD has been cooperating with Georgia’s two major commercial banks that are considered as strategic partners. Georgian commercial banks have made a big step forward from the standpoint of staff qualification in trade financing sector. To increase turnover, they should develop clients in corporate and retails sectors”.

Nana Khurtsidze, a TBC Bank Trade Financing Department Head, noted the conference was very important: “TBC Bank has hosted an EBRD conference. Representatives of regional and international banks were invited. The conference collected information on perspectives for trade sector financing.

This is very important because we are able to share and apply their experience. The support of foreign financial institutions is very significant for Georgian banks to financing trade operations. Their experience should be also applied”.

The credit portfolio of commercial banks in May 2014 marked 10.944 billion GEL, the National Bank of Georgia (NBG) says. The figure is up by 39 million GEL compared to April 2014. The overdue loans portfolio has shrunk to 283.994 million GEL from 291.53 million GEL in May compared to April 2014.

The trade sector crediting portfolio’s ratio in total corporate loans portfolio is over 44.5%. The trade sector crediting portfolio in May declined by 1.1% compared to April (-27.5 million GEL) and marked 2.4 billion GEL as of April 1, 2014.

The ratio of industry sector in total corporate term loans portfolio made up 17.1% that is 918.2 million GEL as of June 1, 2014, down 0.9% that is 8.3 million GEL less compared to May 1. 2014.

Housing sector’s ratio marked 8% (430 million GEL), down 0.2% month on month (-1 million GEL). Thus, 69.6% of the corporate loans portfolio is recorded for three main sectors – trade, industry and housing.

The crediting volume of resident individuals rose by 103.8 million GEL in May, up by 2.1% compared to April 2014 and marked over 5.1 billion GEL.

The TBC Bank conference was attended by representatives of CITI BANK N.A, COMMERZBANK AG, BNP PARIBAS, SUMITOMO MITSUI BANKING CORPORATION, ABN AMRO Bank…), as well as commercial banks of Armenia and Azerbaijan, NBG and the Georgian Chamber of Commerce and Industry.