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Review of Banking Sector in 2015: PMCG

In December 2015, compared to the same month of the previous year 2014, the volume of total deposits increased by 24.8% (3 080 mln GEL), while the volume of total loans to the national economy increased by 23.5% (3 074 mln GEL), PMCG reports.

Taking exchange rates into consideration, the growth rate of the deposits is 5.4% and the growth rate of the loans is 5.8%. In this period, the average interest rate on deposits denominated in foreign currency declined by 0.6 percentage point and on deposits denominated in the national currency increased by 1.1% percentage.

Regarding loans, interest rates on loans denominated in foreign currencies declined by 1.1 percentage point and on loans denominated in GEL declined by 0.6% point.

The share of the deposits denominated in foreign currencies in total deposits increased by 10.0%, while the share of the loans denominated in the foreign currencies increased by 3.7%.

However, taking exchange rates into consideration, the change in these indicators are 4.5 percentage point and -2.2 percentage point, respectively. Therefore, the level of the dollarization of the deposits increased, while the level of dollarization of loans declined.

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In December 2015, the volume of the total deposits, excluding interbank deposits, amounted to 15 505 mln GEL, which exceeds the indicator of 2014 by 24.8%. The volume of deposits denominated in the national currency declined by 6.1%, while the volume of the deposits denominated in foreign currencies increased by 45.4%, but taking exchange rates into consideration, the growth rate of this indicator is only 13.2%.

In 2015, the average interest rate on the deposits denominated in foreign currencies was 4.6%, which is 0.6 percentage point lower than the same indicator of the previous year. In this period, the average interest rate on the deposits denominated in the national currency increased (0.1 percentage point) and equaled 7.7%.

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In December 2015, the volume of loans issued by commercial banks (excluding interbank loans) recorded 16 154 mln GEL, which exceeds the corresponding indicator in 2014 by 23.5%. Here, the volume of the loans denominated in national currency increased by 11.8%, while the volume of the loans denominated in foreign currencies increased by 31.0%, but taking exchange rates into consideration, the growth rate of the loans denominated in foreign currencies was only 2.0%.

In 2015, the average interest rate on the loans denominated in foreign currencies was 10.8%, which is 1.1 percentage point lower compared to the indicator of 2014. In this period, the average interest rate on the loans denominated in the national currency declined by 0.6 percentage point and equaled 17.6%.

In December 2015, the largest sectors by volume of loans to the economy are industry (12.5%), trade (11.4%) and transactions in real estate (4.0%).

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In this period, compared to December 2014, the volume of loans to the industrial sector (19.4%; 307.1 mln GEL) and to the transactions in real estate (36.5%; 162.3 mln GEL) increased significantly, while loans declined to trade (-11.3%; 220.8 mln GEL).

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