Bank of Georgia Group PLC General provision relating to COVID-19 (8854I)
06 April 2020 - 7:30PM
UK Regulatory
TIDMBGEO
RNS Number : 8854I
Bank of Georgia Group PLC
06 April 2020
London, 6 April 2020
General provision relating to COVID-19
Bank of Georgia Group PLC (the "Group") announces that, further
to our announcement on 3 April 2020, relating to the National Bank
of Georgia's (the "NBG") updated supervisory plan for Georgian
banking sector, we have now agreed with the NBG that JSC Bank of
Georgia (the "Bank") will create a general provision of GEL 400
million under the Bank's local accounting basis, which is used for
calculation of the Bank's capital ratios. This represents
approximately 3.3% of the Bank's lending book, and the general
provision is expected to be taken in the first quarter of 2020. Our
understanding is that the specific quantum of the provision
reflects the NBG's current expectation of estimated credit losses
on the Bank's lending book for the whole economic cycle, given
current economic expectations.
The Group publishes its financial accounts on an International
Financial Reporting Standards (IFRS) basis and, at this stage, it
is too early to estimate our likely provisioning requirements on
this basis. We will provide a detailed update with our first
quarter of 2020 results in May.
As we announced last week, the Bank's capital adequacy ratios,
funding and liquidity positions have been strong, and remaining
comfortably above of minimum regulatory requirements. At 29
February 2020, the CET1, Tier 1 and total capital adequacy ratios
were 12.2%, 14.2% and 18.6%, respectively, and following recently
announced measures, the Bank expects the CET1, Tier 1 and Total
Capital adequacy ratio requirements at 6.9%, 8.7% and 13.3%,
respectively, as of 31 March 2020. The NBG has also stated its
willingness, if necessary, to fully or partially release the
remaining requirements of Pillar 2 capital buffers, and, again if
necessary, to introduce initiatives to reduce liquidity
requirements.
The NBG considers the Bank's capital ratios to be sufficiently
in excess of the expected minimum capital requirements at 31 March
2020, to be able to absorb this upfront general provision whilst
maintaining a sufficiently comfortable buffer over the required
minimum capital ratios. This is supported by the Group's recent
track record of strong profitability, and capacity to generate high
levels of internal capital.
Name of authorised official of issuer responsible for making
notification: Natia Kalandarishvili, Head of Investor Relations and
Funding
About Bank of Georgia Group PLC
Bank of Georgia Group PLC ("Bank of Georgia Group" or the
"Group" - LSE: BGEO LN) is a UK incorporated holding company, which
comprises: a) retail banking and payment services, b) corporate and
investment banking and wealth management operations and c) banking
operations in Belarus ("BNB"). JSC Bank of Georgia ("Bank of
Georgia", "BOG" or the "Bank"), the leading universal bank in
Georgia, is the core entity of the Group. The Group targets to
benefit from superior growth of the Georgian economy through both
its retail banking and corporate and investment banking services
and aims to deliver on its strategy, which is based on at least 20%
ROAE and c.15% growth of its loan book .
JSC Bank of Georgia has, as of
the date hereof, the following
credit ratings:
Fitch Ratings 'BB-/B'
Moody's 'Ba3/NP' (FC)
& 'Ba2/NP' (LC)
For further information, please visit www.bankofgeorgiagroup.com
or contact:
Archil Gachechiladze Michael Oliver Sulkhan Gvalia Natia Kalandarishvili
CEO Adviser to the CFO Head of Investor
CEO Relations
+995 322 444 444
+995 322 444 144 +44 203 178 4034 +995 322 444 108 (9282)
agachechiladze@bog.ge moliver@bgeo.com sgvalia@bog.ge ir@bog.ge
This news report is presented for general informational purposes
only and should not be construed as an offer to sell or the
solicitation of an offer to buy any securities
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END
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