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TBC Bank interims rise on stronger lending

By Frank Prenesti

Date: Thursday 15 Aug 2019

(Sharecast News) - A rise in mortgage lending helped Georgian lender TBC Bank report an18.8% rise in underlying net interim profit as its loan book increased.
Net profit for the six months to June 30 rose to GEL 258.3m (£73m), up from GEL 217m a year earlier.

The London-listed bank's net interest margin, a key measure, slipped to 5.8%, from 7% as new rules on lending to higher yield customers came into force.

"Our loan book expanded by 25.2% year-on-year, or by 14.7% at a constant currency rate. As a result, our market share increased to 38.5%, up by 0.2 percentage points year-on-year," the bank said on Thursday.

"The pressure on net interest income was related to a continued impact of the regulation implemented in January 2019, that limits the ability of banks to lend money to higher-yield retail customers, an increase in minimum reserve requirements for foreign currency funds, as well as competition in interest rates."

TBC last month said chairman Mamuka Khazaradze and deputy Badri Japaridze had decided to step down from the board with immediate effect, after prosecutors charged them with money laundering.

"They have both arrived at this decision after careful consideration in order to ensure that the allegations made against them do not affect the Group and to be able to concentrate on refuting those allegations," TBC Bank said at the time.

The executives, who founded the bank in the early 1990s, were charged with laundering illegal revenues worth more than $16.75m, prosecutors said.

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