TBILISI

Bank of Georgia (BOG), one of the biggest commercial banks in the country, reported a net profit of 341.1 million lari ($110 million) in the first half of 2021 compared to a 14.7 million lari in the same period last year.

BOG is one of the two biggest commercial banks in Georgia and is listed on the London Stock Exchange.

The bank’s operating income rose to 638.6 million lari in January-June this year from 514.1 million lari.

Total assets rose to 21.9 million lari as of June 30 from 19.2 million lari a year ago, while liabilities rose to 19 million lari from 17 million lari. Total equity rose to 2.8 million lari from 2.2 million lari.

Commercial banks in Georgia reported a total net profit of 1.237 billion lari from January to July compared to a loss of 413 million lari in the same period in 2020. The country’s central bank said that total income was 3.391 billion lari compared with 2.700 billion lari in the first seven months of 2020. Banks reduced their expenses in that period to 2.014 billion lari, compared with 2.981 billion lari.

Georgia’s banking sector, which includes 15 commercial banks, of which 14 have foreign capital, started to show its first signs of recovery at the beginning of the year, when some of the restrictions imposed by the pandemic were first eased.

In March, Fitch Ratings revised the outlook on BOG to “stable” from “negative”, while affirming its long-term Issuer Default Ratings (IDRs).

The agency said that the revision of the outlook to “stable” reflected “reduced pressure on the bank’s credit profile from the pandemic and contraction of the Georgian economy.”

Fitch said that the funding and liquidity profile of BOG had been stable as the bank was largely funded by customer deposits (73 percent of liabilities) and there had been no material outflows at times of market turbulence in 2020.

The agency added that it expected that BOG’s pre-impairment profit was sufficient to absorb any additional credit losses from the pandemic without jeopardising its financial profile.