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

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