Bank of Georgia posts increase in first-quarter revenue and profit

Bank of Georgia saw revenue and pre-tax profits rise in the first quarter driven by growth in retail banking and wealth management.

Bank of Georgia saw revenue and pre-tax profits rise in the first quarter driven by growth in retail banking and wealth management.

Profit before tax climbed by 5.7% year-on-year to 50.5m Georgian Lari (GEL) while revenue increased 12% to 13.1 GEL.

The group's net interest margin came to 7.6%, up from 7.3% the prior year.

The net loan book grew by 8.9% and client deposits jumped 14.9%. Retail banking client deposits rose 21.3%, asset and wealth management client deposits were up 25.2% while corporate banking deposits increased by a modest 2.2%.

Retail Banking continued to deliver strong franchise growth, supported by the successful roll-out of the "Express Banking" strategy in 2012, adding 655 new express pay terminals and 244,360 express cards.

Asset and wealth management expanded its franchise with assets under management increasing by 25.2% to 613.8m GEL.

At the end of the period the balance sheet leverage remained low at 4.0 times, compared to 3.7 times a year ago and 4.3 times in the previous quarter.

"Our first quarter results demonstrate the resilience of the bank's business strategy and benefited from the strength of our retail banking business, good performances from our non-banking subsidiaries and strong cost management throughout the business," said Chief Executive Officer Irakli Gilauri.

"The core fundamentals of our business remain strong. Improving economies of scale, supported by the roll-out of our Express banking strategy over the last few quarters, give us increasing flexibility in the recent slower economic environment as reflected in our continued positive operating leverage."

He said the company was well placed for growth with an improved corporate lending pipeline and economic recovery.

Shares fell 2.65% to 1,693p at 10:38 Monday.

RD

Recommended

Share tips of the week – 28 January
Share tips

Share tips of the week – 28 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
28 Jan 2022
Which assets will benefit as the “jam tomorrow” bubble pops?
Investment strategy

Which assets will benefit as the “jam tomorrow” bubble pops?

With tech stocks, cryptocurrencies and many other “long duration” investments crashing hard, the “jam tomorrow” bubble looks to be bursting. John Step…
24 Jan 2022
Three innovative Asian stocks to buy now
Share tips

Three innovative Asian stocks to buy now

Professional investor Fay Ren of the Cerno Pacific Fund highlights three of her favourite Asian stocks to buy now
24 Jan 2022
Share tips of the week – 21 January
Share tips

Share tips of the week – 21 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
21 Jan 2022

Most Popular

Shareholder capitalism: why we must return power to listed companies’ ultimate owners
Investment strategy

Shareholder capitalism: why we must return power to listed companies’ ultimate owners

Under our system of shareholder capitalism it's not fund managers, it‘s the individual investors – the company's ultimate owners – who should be telli…
24 Jan 2022
Amazon halts plans to ban UK Visa credit card payments
Personal finance

Amazon halts plans to ban UK Visa credit card payments

Amazon has said that it is to shelve its proposed ban on UK customers making payments with Visa credit cards.
17 Jan 2022
Temple Bar’s Ian Lance and Nick Purves: the essence of value investing
Investment strategy

Temple Bar’s Ian Lance and Nick Purves: the essence of value investing

Ian Lance and Nick Purves of the Temple Bar investment trust explain the essence of “value investing” – buying something for less than its intrinsic v…
14 Jan 2022