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NBG PRESIDENT ON NEW REGULATIONS FOR HOUSING SECTOR

In the coming weeks National Bank of Georgia will offer new game rules to the commercial banks in

lending of construction and healthcare businesses.

President of NBG George Kadagidze stated about it on Wednesday, after the meeting with developers. NBG president stated that his institution will regulate the issue by respective normative act, working on which has already been started.

Regulator of financial system made decision to issue there act on the basid of claim of Builders’ Association of Georgia.

Association member devrlopers (Arsi, Axis) are concerned by the fact that the bank, which own construction company or a hispital, by submission of respective business plan they get access on the ready-made projects, with justification and budget.developers consider that nonprofile construction and healthcare actives give banks monopolistic position in comparison to other market participants. George Kadagidze stated that despite nonprofile actives is about 1% of the total actives of the banks and it does nor create problems to competition, as it seems it’s problem due to specific of Georgian market and his institution will help market in its resolution.

President of Nationwide Bank states that banks will be prohibited to lend own business from the deposits received from clients. Ownership of nonprofile actives may also be prohibited to the clients.