3rd Quarter Results

Released : 12 Nov 2024 07:00

RNS Number : 7875L
Bank of Georgia Group PLC
12 November 2024
 

 

Contents

3Q24 and 9M24 results

Earnings call on 12 November 2024, 14:00 GMT

Segmentation guide

CEO statement

Macroeconomic developments: Georgia

Macroeconomic developments: Armenia

Delivering on our strategic priorities

3Q24 and 9M24 consolidated results

Business Division results

Georgian Financial Services (GFS)

Armenian Financial Services (AFS)

Ameriabank: standalone financial information (not included in consolidated results)

Other Businesses

Consolidated financial information

Additional information

Glossary

Bank of Georgia Group PLC profile

Further information

Forward-looking statements

 

 

3Q24 and 9M24 results

Bank of Georgia Group PLC announces the Group's unaudited consolidated financial results for the third quarter and the first nine months 2024. Unless otherwise noted, numbers in this announcement are given for 3Q24 and 9M24 and the year-on-year comparisons are with adjusted figures of 3Q23 and 9M23 and the q-o-q comparisons are with adjusted figures of 2Q24.

 

The results are based on International Financial Reporting Standards (IFRS) as adopted by the United Kingdom, are unaudited and derived from management accounts.

Earnings call on 12 November 2024, 14:00 GMT

https://bankofgeorgia.zoom.us/j/92412821797?pwd=4yTawOnUWYmwxq2HOWInShx34akrpS.1

 

Webinar ID: 924 1282 1797

Passcode: 134783

Segmentation guide

Following the acquisition of Ameriabank at the end of March 2024, the Group results are presented by the following Business Divisions: 1) Georgian Financial Services (GFS), 2) Armenian Financial Services (AFS), and 3) Other Businesses.

·      GFS mainly comprises JSC Bank of Georgia and investment bank JSC Galt and Taggart

·      AFS includes CJSC Ameriabank

·      Other Businesses includes JSC Belarusky Narodny Bank (BNB) serving retail and SME clients in Belarus, JSC Digital Area - a digital ecosystem in Georgia including e-commerce, ticketing, and inventory management SaaS, Bank of Georgia Group PLC - the holding company, and other small entities and intragroup eliminations. 

Bank of Georgia Group PLC delivers 3Q24 consolidated profit of GEL 509.3m and 9M24 adjusted consolidated profit of GEL 1,308.3m

3Q24 consolidated profit was up 42.5% y-o-y to GEL 509.3 million, with a return on average equity standing at 32.1%

·      Georgian Financial Services (GFS) delivered a profit of GEL 411.4 million in 3Q24, with a return on equity of 36.7%.

·      Armenian Financial Services (AFS) posted a profit of GEL 91.4 million in 3Q24, with a return on equity of 23.1%.

·      The Group's loan book increased by 63.4% y-o-y as at 30 September 2024, driven by the consolidation of Ameriabank and a robust, 23.6% growth in GFS.

 

CEO statement

We delivered another strong quarter, posting a record profit of GEL 509.3 million and an ROE of 32.1%, driven by robust performances in our core business divisions in Georgia and Armenia, supported by lower cost of risk and strong macroeconomic fundamentals. We continued to focus on our strategic priorities and advanced the integration process of Ameriabank, with our various strategic integration workstreams progressing well and bringing the teams together.

 

The political situation in Georgia has been top of mind for many of our stakeholders recently. As we navigate a period of post-election political tensions which, unsurprisingly and understandably, elevate emotions in everyone, we remain focused on serving the whole of Georgia, supporting our customers and communities as a key systemic universal bank. We do not expect this period to have any significant impact on the economy. Therefore, we maintain our real GDP growth forecasts at 9% and 6% for 2024 and 2025 respectively, with that growth being underpinned by strong domestic demand, resilient external sector inflows, and prudent macroeconomic management.

 

We are proud that Bank of Georgia has recently been recognised as the World's Best Digital Bank 2024 by Global Finance, competing for this title alongside many prominent global banks. With over 1.5 million monthly active retail digital users in Georgia in September 2024, a remarkable 20.4% increase y-o-y, we are encouraged to see our digital platforms meeting diverse customer needs and receiving global recognition. The connection with our customers is reflected in our Net Promoter Score (NPS) of 67 points, also a remarkable result for any universal bank.

 

As for our financial performance, Georgian Financial Services has continued its robust growth, with net loans up 21.7% y-o-y and customer deposits up 14.9% y-o-y on a constant currency basis as at 30 September 2024. Operating income in 3Q24 was up 11.0% y-o-y to GEL 683.6 million, mainly driven by strong growth in net interest income. Without the GEL 25 million positive adjustment in net fee and commission income last year, operating income would have increased by 15.7% y-o-y. I mentioned last time that this year we have seen some pressure on operating expenses resulting from double-digit wage growth in the market for the past two years, but these pressures are now stabilising. Overall, profit in Georgian Financial Services was up 17.3% y-o-y in 3Q24 to GEL 411.4 million, with ROE at an exceptional 36.7%. We continue to maintain significant capital buffers and ample liquidity.

 

Armenian Financial Services also delivered strong results in 3Q24, with the q-o-q loan growth on a constant currency basis of 6.1%, profit reaching GEL 91.4 million and ROE standing at 23.1%. Strong domestic demand and ambitious public infrastructure projects are expected to support the growth momentum in Armenia, with expected real GDP growth of 6.0% in 2024 and 4.9% in 2025, according to IMF, thus providing positive impetus to our banking operations. As our teams continue the integration work, we will start to unlock new opportunities, which, we believe, are significant, especially in the retail segment.

 

Overall, our business as a whole is performing well, and we keep focusing on supporting our customers with innovative, customer-centric solutions, and delivering strong growth and profitability in our key geographies, Georgia and Armenia

 

Archil Gachechiladze

CEO, Bank of Georgia Group PLC

11 November 2024

 

Macroeconomic developments: Georgia

Strong economic growth

Economic activity accelerated further in 3Q24, with an estimated 11.1% real GDP growth y-o-y. Economic growth remained broad-based, driven by robust consumption and improving external demand. Galt & Taggart forecasts a 9% real GDP expansion for the full year 2024 and 6% growth in 2025. Upsides exist in public infrastructure projects and emerging service industries such as IT, transport and education. While geopolitical instability in the wider region poses downside risks, ample fiscal space and solid international reserves cushion the economy against potential shocks.

Improving external demand

 

Export of goods increased by a remarkable 25.6% y-o-y in 3Q24, primarily driven by re-exports and increased commodity prices, following modest contractions in the previous quarters. Import of goods rose by only 3.6% y-o-y in 3Q24, narrowing the merchandise trade deficit. Export of services also remained strong amid tourism season and steadily growing proceeds from transportation services. In 3Q24, tourism revenues increased by 8.0% y-o-y, with tourist visits returning to pre-pandemic levels. Money transfers stabilised in 3Q24, registering only a 0.9% y-o-y decline following last year's high base related to migrant inflows. Remittances form the US, EU countries and Israel continued to increase steadily. Overall, external sector inflows are expected to remain robust, supported by diversified income sources and improving conditions in partner economies.

 

Healthy bank lending

 

Bank lending remained robust in 3Q24, increasing by 18.8% y-o-y on a constant currency basis, following a 17.8% y-o-y growth in the previous quarter. Business lending continued to drive credit growth. Loan dollarisation declined further by 1.3 ppts y-o-y to 43.9% at the end of September 2024. The banking sector's credit portfolio remained healthy, with the non-performing loans ratio, according to the IMF, at 1.5% at the end of September 2024.

 

Strong fiscal discipline

 

In the first nine months of 2024, tax revenues rose by 19.4% y-o-y, driven by strong economic growth and last year's amendments to the corporate income tax code. The Government remains committed to fiscal consolidation, with the fiscal deficit planned at 2.5% of GDP in 2024, matching 2023 levels. The government debt-to-GDP ratio is set to decrease further to 36.5% in 2024, down 2.7 ppts y-o-y.

 

Low inflation and prudent monetary policy

 

Inflation remained low in 3Q24, supported by subdued domestic price pressures and stable GEL. Headline CPI inflation was 0.6% y-o-y in September 2024, down from 2.2% in June. Inflation is expected to remain below the National Bank of Georgia's (NBG) 3% target in 2024. The NBG has maintained its policy rate unchanged at 8.0% since May 2024 due to remaining inflation risks related to strong domestic demand and persistent geopolitical tensions.

 

Stable GEL

 

The GEL recovered in value against the US dollar in July 2024 after a brief period of weakness in the previous months. Pressures re-emerged in mid-October, driven by one-off large-scale transactions, according to the NBG. The central bank intervened in FX auctions by selling a total of US$ 213m in October to smooth out the volatility. As a result, the GEL remained stable, close to the beginning-of-year level against the US dollar as at 8 November 2024. In the medium term, strong external sector inflows and prudent macroeconomic management are expected to support the Georgian currency.

 

More information on the Georgian economy and financial sector can be found at https://galtandtaggart.com/en/research/aboutresearch.

 

Macroeconomic developments: Armenia

Robust economic growth

In Armenia, economic activity remained robust in 3Q24, fuelled by a supportive fiscal stance and easing monetary policy. Economic growth was predominantly driven by the construction, trade, and services sectors. Consumption and investment spending remained strong, while exports slowed. As a result, economic growth moderated to more sustainable levels, with the preliminary estimate of economic activity increasing by 6.3% y-o-y in 3Q24. The IMF projects real GDP growth of 6.0% and 4.9% for 2024 and 2025, respectively. While geopolitical tensions and weakening growth prospects in trading partners' economies present downside risks, improvements in infrastructure and ongoing structural reforms offer upside potential. Macroeconomic policies remain prudent, underpinning the resilience of the Armenian economy.


Resilient external sector and strong Dram

Export of goods normalised in 3Q24, increasing by 49.4% y-o-y, following extraordinary growth in the previous quarters, driven largely by gold re-exports. Imports slowed as well, with a 21.5% y-o-y growth. Export of services also declined, due to reduced tourist inflows and weakening global demand for IT services. However, remittances regained momentum, with total money transfers up 7.5% y-o-y in 3Q24 (vs. a 2.4% decline in 2Q24). Continued strength of merchandise exports and money transfers contributed to the strengthening of the Dram by 4.3% versus the US dollar year-to-date as at 8 November 2024, making it one of the best performing currencies in the region.

 

Low inflation and continued easing of monetary policy

In 3Q24, inflation remained low, supported by a strong Dram and declining food prices. Headline CPI inflation was 0.6% y-o-y in September 2024, well below the Central Bank of Armenia's (CBA) 4% target. Amid subdued price pressures, the CBA continued its gradual monetary easing, cutting the refinancing rate by a cumulative 2 ppts to 7.25% in as at end-October 2024, following a total reduction of 1.5 ppts in 2023.

 

Sound banking sector

The banking sector in Armenia remains well-capitalised, liquid and highly profitable. Estimated bank lending growth was 21.7% y-o-y in constant currency terms in 3Q24, following a 19.1% y-o-y growth in the previous quarter. The lending growth was predominantly driven by local currency loans, leading to a further reduction in loan dollarisation (down 1.9 ppts y-o-y to 33.7 by the end of September 2024).

 

Delivering on our strategic priorities

The main bank

Being the main bank in customers' daily lives by leveraging the digital and payments ecosystems.

Bank of Georgia (BOG)

In October 2024, JSC Bank of Georgia was recognised as the World's Best Digital Bank 2024 by Global Finance.

Monthly active customers (Retail)

Digital MAU (Retail)

Payment MAU (Retail)

Share of products sold through retail digital channels (Retail)

Monthly active customers (Legal entities)

Digital MAU (Legal entities)

1.9 million

1.5 million

1.4 million

58% (3Q24)

110K

87K

+12.0% y-o-y

+20.4% y-o-y

+18.5% y-o-y

+11 ppts y-o-y

+19.7% y-o-y

+26.1% y-o-y

 

BOG continued to develop its payments acquiring business during the quarter. The volume of payment transactions in BOG's in-store/online POS terminals was up 31.2% y-o-y and 13.3% q-o-q in the third quarter of 2024, to GEL 5.3 bn. In 9M24, the volume of payment transactions totalled GEL 14.0bn (up 33.2% y-o-y). BOG's payments acquiring market share increased to 57.3% in September 2024 (up 2.1 ppts y-o-y).

 

Ameriabank

Ameriabank had 312 thousand monthly active retail customers as at September 2024 (up 13.5% y-o-y and up 3.8% q-o-q), of which Digital MAU was 188 thousand (up 39.0% y-o-y and up 8.6% q-o-q)[1].

Excellent customer experience

Anticipating customer needs and wants, and providing relevant products and services.

Bank of Georgia's Net Promoter Score (NPS) was 67 in 3Q24 (59 in 3Q23 and 71 in 2Q24).                                

Profitable growth

Growing the balance sheet profitably and focusing on areas with high growth potential.

·      Georgian Financial Services loan book grew 23.6% y-o-y and 3.6% q-o-q, amounting to GEL 22,444.1 million as at 30 September 2024. Growth on a constant currency basis was 21.7% y-o-y and 4.3% q-o-q.

·      Armenian Financial Services loan book grew 3.1% q-o-q (6.1% on a constant currency basis), amounting to GEL 7,955.7 million as at 30 September 2024.

 

Our key targets for the medium term are:

·      c.15% annual growth of the Group's loan book (the target was revised up from c.10% following the acquisition of Ameriabank in March 2024)

·      20%+ return on average equity

·      30-50% annual capital distribution ratio (dividends and share buybacks)

 

3Q24 and 9M24 consolidated results

In the commentary below, the Group's main Business Divisions are referred to as GFS (Georgian Financial Services) and AFS (Armenian Financial Services). Given the first-time consolidation of Ameriabank's P&L in 2Q24, the y-o-y growth rates at the Group level have been significantly impacted by the consolidation. To see the underlying performance of our business in Georgia, please see pages 10 to 12.  

 

GEL thousands

3Q24

3Q24

3Q24

3Q24


3Q23

3Q23

3Q23

3Q23

INCOME STATEMENT HIGHLIGHTS

GROUP

GFS

AFS

OTHER


GROUP

GFS

AFS

OTHER

Interest income 

1,115,448

837,908

256,769

20,771


706,871

687,296

-

19,575

Interest expense 

(474,412)

(371,324)

(95,163)

(7,925)


(286,895)

(281,962)

-

(4,933)

Net interest income 

641,036

466,584

161,606

12,846

 

419,976

405,334

-

14,642

Net fee and commission income 

134,100

110,887

21,104

2,109


118,949

116,661

-

2,288

Net foreign currency gain

153,023

98,214

38,744

16,065


97,790

88,396

-

9,394

Net other income

9,501

7,919

1,804

(222)


5,738

5,371

-

367

Operating income

937,660

683,604

223,258

30,798

 

642,453

615,762

-

26,691

Salaries and other employee benefits

(203,484)

(111,225)

(80,604)

(11,655)


(106,739)

(95,523)

-

(11,216)

Administrative expenses

(72,528)

(52,013)

(13,829)

(6,686)


(46,081)

(40,303)

-

(5,778)

Depreciation, amortisation and impairment

(47,285)

(31,446)

(13,212)

(2,627)


(31,247)

(27,776)

-

(3,471)

Other operating expenses 

(3,137)

(1,245)

(1,574)

(318)


(1,247)

(692)

-

(555)

Operating expenses 

(326,434)

(195,929)

(109,219)

(21,286)

 

(185,314)

(164,294)

-

(21,020)

Profit from associates

502

389

-

113


302

333

-

(31)

Operating income before cost of risk

611,728

488,064

114,039

9,625

 

457,441

451,801

-

5,640

Cost of risk 

(5,216)

(2,391)

(3,558)

733


(35,805)

(38,548)

-

2,743

Net operating income before non-recurring items

606,512

485,673

110,481

10,358

 

421,636

413,253

-

8,383

Net non-recurring items 

-

-

-

-


58

-

-

58

Profit before income tax expense

606,512

485,673

110,481

10,358

 

421,694

413,253

-

8,441

Income tax expense

(97,259)

(74,259)

(19,078)

(3,922)


(64,330)

(62,448)

-

(1,882)

Profit 

509,253

411,414

91,403

6,436

 

357,364

350,805

-

6,559

 

GEL thousands

3Q24

3Q23

Change

y-o-y

2Q24

Change

q-o-q


9M24

9M23

Change

y-o-y

INCOME STATEMENT HIGHLIGHTS










Net interest income 

641,036

419,976

52.6%

618,335

3.7%


1,697,191

1,187,785

42.9%

Net fee and commission income 

134,100

118,949

12.7%

150,662

-11.0%


392,564

320,416

22.5%

Net foreign currency gain

153,023

97,790

56.5%

151,886

0.7%


395,449

268,460

47.3%

Net other income

9,501

5,738

65.6%

28,112

-66.2%


45,406

96,476

-52.9%

Operating income

937,660

642,453

45.9%

948,995

-1.2%

 

2,530,610

1,873,137

35.1%

Operating expenses 

(326,434)

(185,314)

76.2%

(337,821)

-3.4%


(852,293)

(528,849)

61.2%

Profit from associates

502

302

66.2%

378

32.8%


978

1,202

-18.6%

Operating income before cost of risk

611,728

457,441

33.7%

611,552

0.0%

 

1,679,295

1,345,490

24.8%

Cost of risk 

(5,216)

(35,805)

-85.4%

(87,896)

-94.1%


(116,111)

(116,255)

-0.1%

     Out of which initial ECL related to assets acquired in business combination

-

-

-

(49,157)

NMF


(49,157)

-

NMF

Net operating income before non-recurring items

606,512

421,636

43.8%

523,656

15.8%

 

1,563,184

1,229,235

27.2%

Net non-recurring items 

-

58

NMF

-

-


-

-

-

Profit before income tax expense and one-off items

606,512

421,694

43.8%

523,656

15.8%

 

1,563,184

1,229,235

27.2%

Income tax expense

(97,259)

(64,330)

51.2%

(93,668)

3.8%


(254,876)

(183,079)

39.2%

Profit adjusted for one-off items

509,253

357,364

42.5%

429,988

18.4%

 

1,308,308

1,046,156

25.1%

One-off items[2]

-

-

-

679

NMF


669,465

21,061

NMF

Profit 

509,253

357,364

42.5%

430,667

18.2%

 

1,977,773

1,067,217

85.3%

 










Basic earnings per share

11.71

8.12

44.2%

9.79

19.6%

 

45.12

23.76

89.9%

Diluted earnings per share

11.49

7.92

45.1%

9.62

19.4%

 

44.29

23.22

90.7%

 










BALANCE SHEET HIGHLIGHTS

 

Sep-24

 

Sep-23

Change

y-o-y

 

Jun-24

Change

q-o-q





Liquid assets

14,253,652

10,258,057

39.0%

14,479,764

-1.6%





    Cash and cash equivalents

3,413,286

2,959,832

15.3%

3,422,747

-0.3%

 




    Amounts due from credit institutions

2,560,821

1,878,849

36.3%

2,710,729

-5.5%

 




    Investment securities

8,279,545

5,419,376

52.8%

8,346,288

-0.8%

 




Loans to customers, factoring and finance lease receivables[3]

31,058,958

19,010,599

63.4%

30,081,566

3.2%





Property and equipment

534,234

430,181

24.2%

529,715

0.9%





All remaining assets

1,518,584

1,150,976

31.9%

1,437,376

5.6%





Total assets

47,365,428

30,849,813

53.5%

46,528,421

1.8%

 




Client deposits and notes

31,872,416

21,743,543

46.6%

30,706,272

3.8%





Amounts owed to credit institutions

5,701,966

3,163,001

80.3%

6,366,603

-10.4%





    Borrowings from DFIs

1,899,130

2,084,165

-8.9%

2,053,214

-7.5%

 




    Short-term loans from the National Bank of Georgia

1,166,526

180,099

NMF

1,443,950

-19.2%

 




    Short-term loans from the Central Bank of Armenia

164,993

-

NMF

175,993

-6.3%

 




Loans and deposits from commercial banks

2,471,317

898,737

175.0%

2,693,446

-8.2%





Debt securities issued

2,220,896

425,560

NMF

2,128,224

4.4%





All remaining liabilities

1,038,608

782,531

32.7%

1,164,031

-10.8%





Total liabilities

40,833,886

26,114,635

56.4%

40,365,130

1.2%

 




Total equity

6,531,542

4,735,178

37.9%

6,163,291

6.0%

 




Book value per share

150.46

107.64

39.8%

141.14

6.6%

 














KEY RATIOS

3Q24

3Q23


2Q24



9M24

9M23


ROAA (adjusted for one-off items)[4]

4.4%

4.8%


3.9%



4.3%

4.9%


ROAE (adjusted for one-off items)

32.1%

30.7%


28.0%



30.1%

31.1%


Net interest margin4

6.2%

6.6%


6.3%



6.4%

6.5%


Loan yield4

12.2%

12.6%


12.4%



12.5%

12.6%


Liquid assets yield4

5.1%

4.7%


5.0%



5.2%

4.6%


Cost of funds4

4.8%

4.7%


4.8%



4.9%

4.7%


Cost of client deposits and notes4

4.0%

4.2%


4.0%



4.1%

4.0%


Cost of amounts owed to credit institutions4

7.7%

8.0%


7.7%



8.1%

8.3%


Cost of debt securities issued4

7.4%

8.6%


8.2%



8.2%

8.0%


Cost:income ratio

34.8%

28.8%


35.6%



33.7%

28.2%


NPLs to gross loans

1.8%

2.4%


2.0%



1.8%

2.4%


NPL coverage ratio

71.4%

69.1%


63.7%



71.4%

69.1%


NPL coverage ratio adjusted for the discounted value of collateral

124.2%

122.1%


119.4%



124.2%

122.1%


Cost of credit risk ratio4

0.2%

0.6%


1.1%



0.6%

0.8%


 

 

Performance highlights

·      The Group generated operating income of GEL 937.7m in 3Q24 (up 45.9% y-o-y and down 1.2% q-o-q). In 9M24, operating income amounted to GEL 2,530.6m (up 35.1% y-o-y). The y-o-y increases in 3Q24 and 9M24 were largely driven by the consolidation of Ameriabank, together with 11.0% and 9.9% y-o-y increases respectively in GFS. In GFS, strong y-o-y growth in 3Q24 was recorded in net interest income and net foreign currency gain, partly offset by lower net fee and commission income resulting from a positive net GEL 25.0m booked in 3Q23 due to amendments in the accounting model for payment systems charges. Excluding this effect, the y-o-y growth in GFS net fee and commission income in 3Q24 would have been 21.0%. Compared with the prior quarter, operating income was broadly flat, with growth in GFS offset by lower operating income in AFS and Other Businesses.  

·      The Group's operating expenses amounted to GEL 326.4m in 3Q24 (up 76.2% y-o-y and down 3.4% q-o-q). The y-o-y growth on the Group level was mainly driven by the consolidation of Ameriabank, although increases have also been experienced at GFS. In 9M24, operating expenses amounted to GEL 852.3m (up 61.2% y-o-y), mainly due to the same reasons mentioned above. The Group's cost to income ratio was 34.8% in 3Q24 (28.8% in 3Q23 and 35.6% in 2Q24). In 9M24, cost to income ratio was 33.7% (28.2% in 9M23). The Group's cost to income ratio was negatively impacted by the higher cost to income ratio of AFS.

·      The Group's profit was GEL 509.3m in 3Q24 (up 42.5% y-o-y and up 18.4% q-o-q). The Group's profit (adjusted for one-off items) was GEL 1,308.3m in 9M24 (up 25.1% y-o-y). Return on average equity was 32.1% in 3Q24 (30.7% in 3Q23 and 28.0% in 2Q24). In 9M24, return on average equity (adjusted for one-off items) was 30.1% (31.1% in 9M23).

Asset quality

·    Loan portfolio quality has remained healthy. Cost of credit risk ratio was 0.2% in 3Q24 (0.6% in 3Q23 and 1.1% in 2Q24 or 0.4% if adjusted for Ameriabank initial ECL), driven by robust performances in both the Georgian and Armenian operations. In 9M24, cost of credit risk ratio was 0.6% (0.3% if adjusted for Ameriabank initial ECL charge) vs 0.8% in 9M23.

·      The NPLs to gross loans ratio improved to 1.8% as at 30 September 2024 (down 60 bps y-o-y and down 20 bps q-o-q). The y-o-y decrease was mainly driven by a decrease in GFS NPL ratio (down 50 bps y-o-y to 1.9%). AFS NPL ratio was also down q-o-q.                

GEL thousands, unless otherwise noted

Sep-24

Sep-23

Change

y-o-y

Jun-24

 

Change

q-o-q

NON-PERFORMING LOANS







Group (consolidated)







NPLs (in GEL thousands)

564,429

470,808

19.9%

613,405


-8.0%

NPLs to gross loans 

1.8%

2.4%


2.0%



NPL coverage ratio

71.4%

69.1%


63.7%



NPL coverage ratio adjusted for the discounted value of collateral

124.2%

122.1%


119.4%



Georgian Financial Services (GFS)







NPLs to gross loans

1.9%

2.4%


2.1%



NPL coverage ratio

70.6%

66.0%


66.0%



NPL coverage ratio adjusted for the discounted value of collateral

119.4%

119.6%


116.4%



Ameriabank (standalone figures)







NPLs to gross loans

1.6%

-


2.1%



NPL coverage ratio

78.4%

-


66.3%



NPL coverage ratio adjusted for the discounted value of collateral

136.9%

-


122.3%



           

Portfolio highlights

·      Loans to customers, factoring and finance lease receivables amounted to GEL 31,059.0m as at 30 September 2024, up 63.4% y-o-y and up 3.2% q-o-q in nominal terms. The significant y-o-y increase is attributable to the Ameriabank acquisition, as well as a 23.6% loan growth in GFS.

·    Client deposits and notes amounted to GEL 31,872.4m as at 30 September 2024 (up 46.6% y-o-y and up 3.8% q-o-q). The y-o-y growth was driven by the Ameriabank acquisition as well as a 16.8% deposit growth in GFS.

Capital return

·      In August 2024, the Board of Directors declared an interim dividend of GEL 3.38 per ordinary share in respect of the period ended 30 June 2024 to ordinary shareholders of Bank of Georgia Group PLC. The interim dividend was paid on 11 October 2024.

·      In addition, in August 2024, the Board announced a further share buyback and cancellation programme totalling GEL 73.4 million. The Company commenced the share buyback and cancellation programme in August 2024, and as at 31 October 2024 the Company had bought back 265,229 ordinary shares at a total cost of GEL 37.9 million, of which 247,729 shares were cancelled.

Business Division results 

Following the acquisition of Ameriabank in March 2024, the Group results are presented by the following Business Divisions: 1) Georgian Financial Services (GFS), 2) Armenian Financial Services (AFS), and 3) Other Businesses.

Georgian Financial Services (GFS)

Georgian Financial Services (GFS) mainly comprises JSC Bank of Georgia and investment bank JSC Galt and Taggart.

GEL thousands

3Q24

3Q23

Change

y-o-y

2Q24

Change

q-o-q


9M24

9M23

Change

y-o-y

INCOME STATEMENT HIGHLIGHTS










Interest income 

837,908

687,296

21.9%

797,984

5.0%


2,381,834

1,951,381

22.1%

Interest expense 

(371,324)

(281,962)

31.7%

(359,907)

3.2%


(1,054,744)

(803,528)

31.3%

Net interest income 

466,584

405,334

15.1%

438,077

6.5%

 

1,327,090

1,147,853

15.6%

Net fee and commission income 

110,887

116,661

-4.9%

120,453

-7.9%


338,691

314,890

Net foreign currency gain

98,214

88,396

11.1%

99,177

-1.0%


279,021

236,189

18.1%

Net other income

7,919

5,371

47.4%

12,101

-34.6%


27,398

94,939

-71.1%

Operating income

683,604

615,762

11.0%

669,808

2.1%

 

1,972,200

1,793,871

9.9%

Salaries and other employee benefits

(111,225)

(95,523)

16.4%

(112,521)

-1.2%


(318,240)

(272,730)

16.7%

Administrative expenses

(52,013)

(40,303)

29.1%

(49,674)

4.7%


(143,365)

(112,308)

27.7%

Depreciation, amortisation and impairment

(31,446)

(27,776)

13.2%

(29,904)

5.2%


(90,184)

(81,443)

10.7%

Other operating expenses 

(1,245)

(692)

79.9%

(1,369)

-9.1%


(4,108)

(1,948)

110.9%

Operating expenses 

(195,929)

(164,294)

19.3%

(193,468)

1.3%

 

(555,897)

(468,429)

18.7%

Profit from associates

389

333

16.8%

378

2.9%


978

730

34.0%

Operating income before cost of risk

488,064

451,801

8.0%

476,718

2.4%

 

1,417,281

1,326,172

6.9%

Cost of risk 

(2,391)

(38,548)

-93.8%

(27,623)

-91.3%


(50,484)

(122,077)

-58.6%

Profit before income tax expense

485,673

413,253

17.5%

449,095

8.1%

 

1,366,797

1,204,095

13.5%

Income tax expense

(74,259)

(62,448)

18.9%

(68,226)

8.8%


(204,142)

(176,595)

15.6%

Profit adjusted for one-off items

411,414

350,805

17.3%

380,869

8.0%

 

1,162,655

1,027,500

13.2%

One-off items

-

-

-

-

-


-

21,061

NMF

Profit 

411,414

350,805

17.3%

380,869

8.0%

 

1,162,655

1,048,561

10.9%

 










BALANCE SHEET HIGHLIGHTS

Sep-24

Sep-23

Change

y-o-y

Jun-24

Change

q-o-q





Cash and cash equivalents

2,059,303

2,497,977

-17.6%

1,899,605

8.4%


 

Amounts due from credit institutions

1,797,054

1,856,104

-3.2%

1,866,561

-3.7%


 

Investment securities

7,048,177

5,309,190

32.8%

6,942,219

1.5%


 

Loans to customers, factoring and finance lease receivables

22,444,065

18,161,733

23.6%

21,659,438

3.6%


 

    Loans to customers, factoring and finance lease receivables, LC

12,819,317

10,225,451

25.4%

12,043,169

6.4%

 

 

    Loans to customers, factoring and finance lease receivables, FC

9,624,748

7,936,282

21.3%

9,616,269

0.1%

 

 

Property and equipment

443,849

414,500

7.1%

433,585

2.4%


 

All remaining assets

1,111,214

1,068,108

4.0%

1,047,065

6.1%


 

Total assets

34,903,662

29,307,612

19.1%

33,848,473

3.1%

 

 

Client deposits and notes

24,079,718

20,618,922

16.8%

22,659,682

6.3%


 

    Client deposits and notes, LC

11,999,849

10,121,026

18.6%

10,881,951

10.3%


 

    Client deposits and notes, FC

12,079,869

10,497,896

15.1%

11,777,731

2.6%


 

Amounts owed to credit institutions

4,743,875

3,067,766

54.6%

5,065,866

-6.4%


 

Debt securities issued

1,067,012

414,289

157.6%

1,040,106

2.6%


 

All remaining liabilities

423,262

743,801

-43.1%

735,130

-42.4%


 

Total liabilities

30,313,867

24,844,778

22.0%

29,500,784

2.8%

 

 

Total equity

4,589,795

4,462,834

2.8%

4,347,689

5.6%

 

 

Risk-weighted assets (JSC Bank of Georgia standalone)

26,635,323

20,881,399

27.6%

25,800,413

3.2%

 

 

 

 

 

 

 

 

 

 

 

 

KEY RATIOS

3Q24

3Q23

 

2Q24

 

 

9M24

9M23

 

ROAA (adjusted for one-off items)

4.8%

5.0%


4.7%



4.8%

5.1%

 

ROAA (unadjusted)

4.8%

5.0%


4.7%



4.8%

5.2%

 

ROAE (adjusted for one-off items)

36.7%

31.7%


34.6%



33.9%

32.2%

 

ROAE (unadjusted)

36.7%

31.7%


34.6%



33.9%

32.8%

 

Net interest margin

6.1%

6.6%


6.0%



6.1%

6.5%

 

Loan yield

12.4%

12.7%


12.5%



12.5%

12.7%

 

    Loan yield, LC

14.9%

15.6%


14.9%



14.9%

15.8%

 

    Loan yield, FC

9.2%

9.1%


9.5%



9.3%

8.8%

 

Cost of funds

5.1%

4.9%


5.2%



5.2%

4.8%


Cost of client deposits and notes

4.3%

4.3%


4.4%



4.4%

4.1%


    Cost of client deposits and notes, LC

7.6%

8.4%


7.9%



7.9%

8.4%


    Cost of client deposits and notes, FC

1.2%

0.6%


1.1%



1.1%

0.5%


Cost of time deposits

6.7%

6.6%


6.9%



6.8%

6.4%


    Cost of time deposits, LC

10.2%

10.6%


10.6%



10.6%

10.8%


    Cost of time deposits, FC

1.9%

1.7%


2.5%



2.2%

1.5%


Cost of current accounts and demand deposits

2.3%

2.7%


2.2%



2.4%

2.4%


    Cost of current accounts and demand deposits, LC

4.9%

6.1%


4.8%



5.0%

6.0%


    Cost of current accounts and demand deposits, FC

0.4%

0.1%


0.4%



0.0%

0.1%


Cost:income ratio (adjusted for one-off items)

28.7%

26.7%


28.9%



28.2%

26.1%


Cost:income ratio (unadjusted)

28.7%

26.7%


28.9%



28.2%

25.8%


Cost of credit risk ratio

0.1%

0.7%


0.4%



0.3%

0.8%


 


Performance highlights

·      GFS generated operating income of GEL 683.6m in 3Q24 (up 11.0% y-o-y and up 2.1% q-o-q). The y-o-y growth was mainly driven by net interest income, marginally offset by lower net fee and commission income (see below). In 9M24, operating income amounted to GEL 1,972.2m (up 9.9% y-o-y).

The y-o-y decline in net fee and commission income in 3Q24 was mainly attributable to a high base in 3Q23 as c. GEL25m net positive effect was recorded last year due to amendments in the accounting model for payment systems charges. Excluding this effect, net fee and commission income would have been up 21.0% y-o-y. The q-o-q decline was mainly driven by seasonally higher loyalty programme costs. In 9M24, net fee and commission income was GEL 338.7m (up 7.6% y-o-y); excluding c. GEL27m (significant advisory fee) and c. GEL25m (amendment effect) significant items recorded in 1Q23 and 3Q23 respectively, the underlying y-o-y growth in net fee and commission income in 9M24 would have been c. 29%.

The significant decline in net other income in 9M24 (down 71.1% y-o-y) was driven by a high base in 2Q23 reflecting a significant GEL 68.7m gain on the sale of repossessed assets.

·      The net interest margin increased slightly during the quarter and stood at 6.1% in 3Q24 (down 50 bps y-o-y and up 10 bps q-o-q). The redemption of the $100m AT1 perpetual bond at the end of June 2024 had a small positive impact on the margin. In 9M24, NIM was 6.1% (down 40 bps y-o-y), driven by a combination of higher cost of funds (up 40 bps y-o-y to 5.2%) and lower loan yield (down 20 bps y-o-y to 12.5%).

·      Operating expenses amounted to GEL 195.9m in 3Q24 (up 19.3% y-o-y and up 1.3% q-o-q). In 9M24, operating expenses increased by 18.7% y-o-y to GEL 555.9m. The y-o-y growth in operating expenses in the periods presented was mainly driven by increased salaries and other employee benefits, together with higher administrative expenses related to business growth and continuing investments in key strategic areas.

The y-o-y growth in salary costs reflected a combination of two factors: an increase in staff numbers to support business growth (up 8.5% y-o-y at Bank of Georgia as of September 2024) and higher wages driven by double-digit nominal wage growth in Georgia during 2022-2023. As 2024 has progressed, market nominal wage growth has been stabilising.

·    Cost of credit risk ratio was 0.1% in 3Q24 (0.7% in 3Q23 and 0.4% in 2Q24). The decrease was attributable to improvements in credit quality across all segments, reflecting the continued strength of the Georgian economy. In 9M24, cost of credit risk ratio stood at 0.3% vs 0.8% in 9M23.

·      Overall, GFS posted a profit of GEL 411.4m in 3Q24 (up 17.3% y-o-y and up 8.0% q-o-q). In 9M24, profit amounted to GEL 1,162.7m (up 13.2% y-o-y compared with adjusted profit in 9M23).

 

Portfolio highlights  

From 1Q24 the Corporate Center was separated as a new segment of GFS. The Corporate Center mainly includes treasury and custody operations. Previously, the Corporate Center's income and expenses were allocated to the Retail, SME, and CIB segments. The previous figures for the Retail, SME, and CIB segments have been restated.


Portfolio highlights: Loans to customers, factoring and finance lease receivables

 


Sep-24

Sep-23

Change

y-o-y

Change y-o-y (constant currency)

Jun-24

Change

q-o-q

Change q-o-q (constant currency)

Total GFS

22,444,065

18,161,733

23.6%

21.7%

 21,659,438

3.6%

4.3%

Retail

9,725,127

8,059,208

20.7%

19.8%

 9,290,776

4.7%

4.9%

SME

4,900,686

4,422,394

10.8%

9.0%

 4,898,358

0.0%

0.5%

CIB

7,818,252

5,680,131

37.6%

34.5%

 7,470,304

4.7%

5.9%

Corporate Center

-

-

-

-

-

-

-










Portfolio highlights: client deposits and notes

 


Sep-24

Sep-23

Change

y-o-y

Change y-o-y (constant currency)

Jun-24

Change

q-o-q

Change q-o-q (constant currency)

Total GFS

24,079,718

20,618,922

16.8%

14.9%

22,659,682

6.3%

7.3%

Retail

13,816,179

11,728,532

17.8%

15.4%

13,783,042

0.2%

1.6%

SME

2,083,761

1,744,883

19.4%

17.8%

1,973,477

5.6%

6.3%

CIB

6,324,426

5,915,032

6.9%

6.3%

5,533,539

14.3%

15.0%

Corporate Center

1,920,096

1,536,053

25.0%


1,422,598

35.0%


Eliminations

(64,744)

(305,578)

-78.8%


(52,974)

22.2%



 

 

 

 

Loan portfolio quality: cost of credit risk ratio



3Q24

3Q23

 

 

2Q24

 


Total GFS

0.1%

0.7%

 

 

0.4%

 

 

Retail

0.1%

0.8%



0.4%



SME

0.3%

1.1%



0.8%



CIB

0.0%

0.2%



0.2%




Loan portfolio quality: NPL ratio



Sep-24

Sep-23

 

 

Jun-24

 


Total GFS

1.9%

2.4%

 

 

2.1%

 

 

Retail

1.7%

2.0%



1.8%



SME

3.6%

3.6%



3.5%



CIB

1.1%

2.2%



1.5%



 

·      GFS's loans to customers, factoring and finance lease receivables stood at GEL 22,444.1m (up 23.6% y-o-y and up 3.6% q-o-q) as at 30 September 2024. The y-o-y growth was mainly driven by CIB, followed by RB and SME respectively. The q-o-q growth was driven by RB, followed by CIB. On a constant currency basis, the loan book increased by 21.7% y-o-y and by 4.3% q-o-q.

·      57.1% of the loan book was denominated in GEL as at 30 September 2024 (56.3% at 30 September 2023 and 55.6% at 30 June 2024).

·      Client deposits and notes stood at GEL 24,079.7m as at 30 September 2024 (up 16.8% y-o-y and up 6.3% q-o-q). Strong y-o-y growth was recorded in RB and SME segments. The q-o-q growth was mainly driven by CIB, followed by Corporate Center (mainly due to higher Ministry of Finance deposits), and SME respectively. On a constant currency basis, deposits increased by 14.9% y-o-y and by 7.3% q-o-q. Product-wise, strong y-o-y and q-o-q growth in deposits was primarily driven by time deposits, followed by current accounts and demand deposits.

·   The share of GEL-denominated client deposits increased to 49.8% as at 30 September 2024 (49.1% at 30 September 2023 and 48.0% at 30 June 2024).

 

Liquidity

 

Sep-24

Sep-23

Jun-24




IFRS-based NBG Liquidity Coverage Ratio (Bank of Georgia)

126.3%

135.7%

128.3%


 

IFRS-based NBG Net Stable Funding Ratio (Bank of Georgia)

124.9%

134.5%

126.9%


 


 









·      Bank of Georgia has maintained a strong liquidity position, with IFRS-based NBG liquidity coverage ratio at 126.3% as at 30 September 2024 (135.7% as at 30 September 2023 and 128.3% as at 30 June 2024), and IFRS-based NBG net stable funding ratio at 124.9% as at 30 September 2024 (134.5% as at 30 September 2023 and 126.9% as at 30 June 2024).

 

Capital position

 

·    Bank of Georgia continues to operate with robust capital adequacy levels. At 30 September 2024, the Bank's Basel III CET1, Tier1, and Total capital ratios stood at 17.2%, 20.8%, and 23.3%, respectively, all comfortably above the minimum requirements of 15.0%, 17.2%, 20.1%, respectively. The movement in capital adequacy ratios in 3Q24 and the potential impact of a 10% devaluation of GEL is as follows: 


30 June 2024

3Q24

profit

Business growth

Currency impact

Capital distribution

Tier 1 - Tier 2

30 Sep

2024

 

 

 

Buffer above min requirement

Potential impact

of a 10% GEL devaluation














CET 1 capital adequacy

17.0%

1.5%

-0.5%

0.1%

-0.9%

0.0%

17.2%




2.2%

-0.8%

Tier 1 capital adequacy

20.8%

1.5%

-0.7%

0.0%

-0.9%

0.0%

20.8%




3.6%

-0.7%

Total capital adequacy

23.4%

1.5%

-0.8%

0.0%

-0.9%

0.1%

23.3%




3.2%

-0.6%















 

·      Bank of Georgia's minimum capital requirements for December 2024 are expected to be 14.9%, 17.1% and 20.0% for CET1 ratio, Tier1 ratio, and Total capital ratio respectively.



Armenian Financial Services (AFS)

Armenian Financial Services (AFS) includes CJSC Ameriabank

 

GEL thousands

3Q24

2Q24

Change

q-o-q

INCOME STATEMENT HIGHLIGHTS




Interest income 

256,769

253,162

1.4%

Interest expense 

(95,163)

(87,779)

8.4%

Net interest income 

161,606

165,383

-2.3%

Net fee and commission income 

21,104

29,037

-27.3%

Net foreign currency gain

38,744

38,576

0.4%

Net other income

1,804

1,063

69.7%

Operating income

223,258

234,059

-4.6%

Salaries and other employee benefits

(80,604)

(93,592)

-13.9%

Administrative expenses

(13,829)

(13,450)

2.8%

Depreciation, amortisation and impairment

(13,212)

(14,618)

-9.6%

Other operating expenses 

(1,574)

(1,676)

-6.1%

Operating expenses 

(109,219)

(123,336)

-11.4%

Profit from associates

-

-

-

Operating income before cost of risk

114,039

110,723

3.0%

Cost of risk 

(3,558)

(56,091)

-93.7%

    Out of which initial ECL related to assets acquired in business combination

-

(49,157)

-100.0%

Net operating income before non-recurring items

110,481

54,632

102.2%

Net non-recurring items 

-

-

-

Profit before income tax expense

110,481

54,632

102.2%

Income tax expense

(19,078)

(22,409)

-14.9%

Profit adjusted for one-off items

91,403

32,223

183.7%

One-off items

-

679

NMF

Profit 

91,403

32,902

177.8%





BALANCE SHEET HIGHLIGHTS

Sep-24

Jun-24

Change

q-o-q

Cash and cash equivalents

916,969

963,562

-4.8%

Amounts due from credit institutions

732,424

820,104

-10.7%

Investment securities

1,041,356

1,266,048

-17.7%

Loans to customers, factoring and finance lease receivables

7,955,714

7,713,878

3.1%

    Loans to customers, factoring and finance lease receivables, LC

4,702,686

4,590,828

2.4%

    Loans to customers, factoring and finance lease receivables, FC

3,253,028

3,123,050

4.2%

Property and equipment

78,116

83,638

-6.6%

All remaining assets

317,741

298,564

6.4%

Total assets

11,042,320

11,145,794

-0.9%

Client deposits and notes

6,854,363

6,851,090

0.0%

    Client deposits and notes, LC

3,672,842

3,517,958

4.4%

    Client deposits and notes, FC

3,181,521

3,333,132

-4.5%

Amounts owed to credit institutions

962,149

1,259,350

-23.6%

Debt securities issued

1,150,771

1,083,559

6.2%

All remaining liabilities

424,619

390,431

8.8%

Total liabilities

9,391,902

9,584,430

-2.0%

Total equity

1,650,418

1,561,364

5.7%

 




KEY RATIOS

3Q24

2Q24


ROAA (adjusted for one-off items and Ameriabank initial ECL)

3.3%

3.1%


ROAA (unadjusted)

3.3%

1.3%


ROAE (adjusted for one-off items and Ameriabank initial ECL)

23.1%

22.1%


ROAE (unadjusted)

23.1%

8.9%


Net interest margin

6.7%

7.2%


Loan yield

11.5%

12.2%


    Loan yield, LC

13.9%

14.7%


    Loan yield, FC

8.1%

8.5%


Cost of funds

4.2%

4.0%


Cost of client deposits and notes

3.2%

3.0%


    Cost of client deposits and notes, LC

4.8%

4.7%


    Cost of client deposits and notes, FC

1.4%

1.4%


Cost of time deposits

5.8%

5.3%


    Cost of time deposits, LC

9.6%

9.2%


    Cost of time deposits, FC

2.4%

2.1%


Cost of current accounts and demand deposits

1.5%

1.5%


    Cost of current accounts and demand deposits, LC

2.2%

2.1%


    Cost of current accounts and demand deposits, FC

0.7%

0.7%


Cost:income ratio

48.9%

52.7%


Cost of credit risk ratio

0.3%

3.1%


 

Ameriabank was consolidated for the first time at the end of March 2024. In 2Q24 AFS Income Statement results were  consolidated on the Group level for the first time. In addition, to provide more comparable growth trends with previous periods, the performance of standalone Ameriabank during the last seven quarters has been disclosed on page 15: Ameriabank: standalone financial information. Ameriabank's standalone financial information is presented for informational purposes only, is different from AFS results due to fair value adjustments and allocation of certain Group expenses to Business Divisions, and is not included in consolidated results.

 

Performance highlights

·  In 3Q24 operating income amounted to GEL 223.3m (down 4.6% q-o-q), mainly driven by decreased net fee and commission income due to a high base of a significant advisory fee (GEL c.10m) booked in 2Q24. Although AFS net interest income was down 2.3% q-o-q, the actual standalone net interest income was up 3.2% q-o-q. The difference in AFS is due to amortisation of fair value adjustments on loans posted as part of business combination, which had a larger positive effect on interest income in the prior quarter. 

·      Operating expenses decreased by 11.4% q-o-q to GEL 109.2m, mainly driven by decreased salaries and other employee benefits. 

·      Loan portfolio quality remained healthy, with cost of credit risk ratio at 0.3% in 3Q24.

·      Overall, AFS generated GEL 91.4m in profit in 3Q24, with ROAE standing at 23.1%.

Portfolio highlights          

·      Loans to customers, factoring and finance lease receivables stood at GEL 7,955.7m as at 30 September 2024 (up 3.1% q-o-q). Growth on a constant currency basis was 6.1% q-o-q. 59.1% of the loan book was denominated in Armenian Drams as at 30 September 2024 (59.5% as at 30 June 2024).

·      Ameriabank had the highest market share in Armenia by total loans - 19.6% as of 30 September 2024 (down 30 bps q-o-q).

·      Client deposits and notes stood at GEL 6,854.4m as at 30 September 2024 (flat q-o-q). On a constant currency basis, deposits were up 2.9% q-o-q. 53.6% of client deposits and notes were denominated in Armenian Drams as at 30 September 2024 (51.3% as at 30 June 2024). Debt securities issued was up 6.2% q-o-q and amounted to GEL 1,150.8m, of which 88.7% were local debt securities. Local debt securities issues are treated similarly to deposits in Armenia and are sold to Ameriabank clients.

·      Ameriabank had the second highest market share by total deposits in Armenia - 17.8% as of 30 September 2024 (flat q-o-q)[5].

 

Liquidity

·      Ameriabank has maintained a strong liquidity position, having CBA LCR of 210.3% and CBA NSFR of 122.6% as at 30 September 2024, well above the minimum regulatory requirements of 100%.

Capital position

·      At 30 September 2024, Ameriabank's CET1, Tier1, and Total capital ratios stood at 15.0%, 15.0%, and 17.4%, respectively, all above the minimum requirements of 11.7%, 13.8%, 16.5%, respectively.  


30 Jun 2024

3Q24

profit

Business growth

Currency impact

Regulatory deductions

Other

30 Sep

2024

 

 

 

Buffer above min requirement

Potential impact

of a 10% AMD devaluation














CET 1 capital adequacy

15.3%

1.2%

-1.3%

0.0%

-0.2%

0.0%

15.0%




3.3%

-0.7%

 

Tier 1 capital adequacy

15.3%

1.2%

-1.3%

0.0%

-0.2%

0.0%

15.0%




1.2%

-0.7%

 

Total capital adequacy

17.8%

1.2%

-1.4%

0.0%

-0.2%

0.0%

17.4%




0.9%

-0.7%

 

 

 



Ameriabank: standalone financial information (not included in consolidated results)

The following table is presented for information purposes only to show the performance of Ameriabank in the last six quarters. It has been prepared consistently with the accounting policies adopted by the Group in preparing its consolidated financial statements.

GEL thousands

3Q24

2Q24

1Q24

4Q23

3Q23

2Q23

1Q23


Change

y-o-y in 3Q24

Change

q-o-q in 3Q24

INCOME STATEMENT HIGHLIGHTS











Interest income 

252,723

240,395

217,180

214,716

196,300

183,395

173,017


28.7%

5.1%

Interest expense 

(91,178)

(83,835)

(78,188)

(74,101)

(68,743)

(69,352)

(62,410)


32.6%

8.8%

Net interest income 

161,545

156,560

138,992

140,615

127,557

114,043

110,607

 

26.6%

3.2%

Net fee and commission income 

21,342

28,772

18,620

16,872

16,925

15,493

16,149


26.1%

-25.8%

Net foreign currency gain

36,247

41,853

31,125

46,512

37,832

37,383

36,683


-4.2%

-13.4%

Net other income

1,795

1,083

1,648

2,428

2,020

2,937

93


-11.1%

65.7%

Operating income

220,929

228,268

190,385

206,427

184,334

169,856

163,532

 

19.9%

-3.2%

Salaries and other employee benefits

(67,366)

(78,897)

(65,158)

(62,352)

(56,828)

(47,978)

(50,434)


18.5%

-14.6%

Administrative expenses

(13,509)

(13,078)

(12,761)

(17,789)

(12,757)

(11,272)

(10,351)


5.9%

3.3%

Depreciation, amortisation and impairment

(9,211)

(8,847)

(7,948)

(7,436)

(7,214)

(7,022)

(6,985)


27.7%

4.1%

Other operating expenses 

(1,572)

(1,663)

(1,121)

(715)

(1,079)

(1,242)

(1,543)


45.7%

-5.5%

Operating expenses 

(91,658)

(102,485)

(86,988)

(88,292)

(77,878)

(67,514)

(69,313)

 

17.7%

-10.6%

Profit from associates

-

-

-

-

-

-

-


-

-

Operating income before cost of risk

129,271

125,783

103,397

118,135

106,456

102,342

94,219

 

21.4%

2.8%

Cost of risk 

(6,716)

(470)

(310)

(16,811)

(2,158)

(16,939)

(1,305)


NMF

NMF

Net operating income before non-recurring items

122,555

125,313

103,087

101,324

104,298

85,403

92,914

 

17.5%

-2.2%

Net non-recurring items 

-

-

-

-

-

-

-


-

-

Profit before income tax expense

122,555

125,313

103,087

101,324

104,298

85,403

92,914

 

17.5%

-2.2%

Income tax expense

(22,292)

(22,938)

(18,826)

(22,918)

(19,383)

(16,228)

(16,896)


15.0%

-2.8%

Profit 

100,263

102,375

84,261

78,406

84,915

69,175

76,018

 

18.1%

-2.1%

 











BALANCE SHEET HIGHLIGHTS

Sep-24

Jun-24

Mar-24

Dec-23

Sep-23

Jun-23

Mar-23




Liquid assets

2,690,749

3,049,714

2,869,140

2,517,735

2,610,555

2,508,511

3,153,599


3.1%

-11.8%

    Cash and cash equivalents

916,969

963,562

989,930

886,111

891,145

831,739

832,367


2.9%

-4.8%

    Amounts due from credit institutions

732,424

820,104

707,851

714,963

764,184

613,005

574,367


-4.2%

-10.7%

    Investment securities

1,041,356

1,266,048

1,171,359

916,661

955,226

1,063,767

1,746,865


9.0%

-17.7%

Loans to customers, factoring and finance lease receivables

7,970,091

7,735,526

6,811,477

6,551,322

6,085,278

5,682,028

5,169,912


31.0%

3.0%

Property and equipment

68,345

71,591

63,357

60,247

59,358

58,366

50,588


15.1%

-4.5%

All remaining assets

256,631

238,307

213,670

248,358

217,875

220,986

225,298


17.8%

7.7%

Total assets

10,985,816

11,095,138

9,957,644

9,377,662

8,973,066

8,469,891

8,599,397

 

22.4%

-1.0%

Client deposits and notes

6,854,363

6,851,090

6,522,822

6,039,076

6,012,377

5,664,040

5,614,381


14.0%

0.0%

Amounts owed to credit institutions

972,890

1,271,190

851,401

904,645

702,152

733,044

948,095


38.6%

-23.5%

Debt securities issued

1,150,771

1,083,559

886,862

785,491

709,314

653,042

622,114


62.2%

6.2%

All remaining liabilities

328,840

269,187

269,511

345,916

271,938

225,130

325,169


20.9%

22.2%

Total liabilities

9,306,864

9,475,026

8,530,596

8,075,128

7,695,781

7,275,256

7,509,759

 

20.9%

-1.8%

Total equity

1,678,952

1,620,112

1,427,048

1,302,534

1,277,285

1,194,635

1,089,638

 

31.4%

3.6%

 











KEY RATIOS[6]

3Q24

2Q24

1Q24

4Q23

3Q23

2Q23

1Q23




ROAA

3.6%

3.9%

3.5%

3.4%

3.9%

3.3%

3.6%




ROAE

24.2%

27.0%

24.8%

24.1%

27.3%

24.3%

27.2%




Loan yield

11.2%

11.4%

11.2%

11.7%

11.1%

11.3%

10.9%




Net interest margin

6.6%

6.8%

6.6%

7.0%

6.7%

6.2%

6.0%




Cost of funds

4.0%

3.8%

3.9%

3.8%

3.7%

3.9%

3.5%




Cost:income ratio

41.5%

44.9%

45.7%

42.8%

42.2%

39.7%

42.4%




Cost of credit risk ratio

0.4%

0.0%

0.1%

0.9%

0.1%

1.2%

0.1%




 

Other Businesses

The Business Division 'Other Businesses' includes JSC Belarusky Narodny Bank (BNB) serving retail and SME clients in Belarus, JSC Digital Area - a digital ecosystem in Georgia including e-commerce, ticketing, and inventory management SaaS, Bank of Georgia Group PLC - the holding company, and other small entities and intragroup eliminations. 

 

GEL thousands

3Q24

3Q23

Change

y-o-y

2Q24

Change

q-o-q


9M24

9M23

Change

y-o-y

INCOME STATEMENT HIGHLIGHTS










Interest income 

20,771

19,575

6.1%

21,275

-2.4%


61,877

52,074

18.8%

Interest expense 

(7,925)

(4,933)

60.7%

(6,400)

23.8%


(18,765)

(12,142)

54.5%

Net interest income 

12,846

14,642

-12.3%

14,875

-13.6%

 

43,112

39,932

8.0%

Net fee and commission income 

2,109

2,288

-7.8%

1,172

79.9%


3,732

5,526

-32.5%

Net foreign currency gain

16,065

9,394

71.0%

14,133

13.7%


39,108

32,271

21.2%

Net other income

(222)

367

NMF

14,948

NMF


15,141

1,537

NMF

Operating income

30,798

26,691

15.4%

45,128

-31.8%

 

101,093

79,266

27.5%

Salaries and other employee benefits

(11,655)

(11,216)

3.9%

(11,039)

5.6%


(32,750)

(32,780)

-0.1%

Administrative expenses

(6,686)

(5,778)

15.7%

(7,123)

-6.1%


(20,511)

(18,632)

10.1%

Depreciation, amortisation and impairment

(2,627)

(3,471)

-24.3%

(2,540)

3.4%


(7,824)

(8,149)

-4.0%

Other operating expenses 

(318)

(555)

-42.7%

(315)

1.0%


(995)

(859)

15.8%

Operating expenses 

(21,286)

(21,020)

1.3%

(21,017)

1.3%

 

(62,080)

(60,420)

2.7%

Profit from associates

113

(31)

NMF

-

-


-

472

NMF

Operating income before cost of risk

9,625

5,640

70.7%

24,111

-60.1%

 

39,013

19,318

102.0%

Cost of risk 

733

2,743

-73.3%

(4,182)

NMF


(5,978)

5,822

NMF

Net operating income before non-recurring items

10,358

8,383

23.6%

19,929

-48.0%

 

33,035

25,140

31.4%

Net non-recurring items 

-

58

NMF

-

-


-

-

-

Profit before income tax expense

10,358

8,441

22.7%

19,929

-48.0%

 

33,035

25,140

31.4%

Income tax expense

(3,922)

(1,882)

108.4%

(3,033)

29.3%


(9,247)

(6,484)

42.6%

Profit 

6,436

6,559

-1.9%

16,896

-61.9%

 

23,788

18,656

27.5%

 










BALANCE SHEET HIGHLIGHTS

Sep-24

Sep-23

Change

y-o-y

Jun-24

Change

q-o-q





Cash and cash equivalents

437,014

461,855

-5.4%

559,580

-21.9%





Amounts due from credit institutions

31,343

22,745

37.8%

24,064

30.2%





Investment securities

190,012

110,186

72.4%

138,021

37.7%





Loans to customers, factoring and finance lease receivables

659,179

848,866

-22.3%

708,251

-6.9%





Property and equipment

12,269

15,681

-21.8%

12,492

-1.8%





All remaining assets

89,629

82,868

8.2%

91,746

-2.3%





Total assets

1,419,446

1,542,201

-8.0%

1,534,154

-7.5%

 

 

 

 

Client deposits and notes

938,335

1,124,621

-16.6%

1,195,500

-21.5%





Amounts owed to credit institutions

(4,058)

95,235

NMF

41,387

NMF





Debt securities issued

3,113

11,271

-72.4%

4,559

-31.7%





All remaining liabilities

190,727

38,730

NMF

38,470

NMF





Total liabilities

1,128,117

1,269,857

-11.2%

1,279,916

-11.9%

 

 

 

 

Total equity

291,329

272,344

7.0%

254,238

14.6%

 

 

 

 

 

 

 

In 3Q24 Other Businesses recorded a GEL 6.4m profit (down 1.9% y-o-y and down 61.9% q-o-q). In the prior quarter, we posted a GEL 12.6m revaluation effect in other income related to JSC Digital Area's investments in startup companies within the framework of 500 startup accelerator programme. In 9M24, Other Businesses posted a profit of a GEL 23.8m (up 27.5% y-o-y).

BNB's capital ratios, calculated in accordance with the National Bank of the Republic of Belarus' standards, were above the minimum requirements at 30 September 2024: Tier1 capital adequacy ratio at 11.9% (minimum requirement of 7.0%) and Total capital adequacy ratio at 17.4% (minimum requirement of 12.5%).

 

 


Consolidated financial information  

GEL thousands

3Q24

3Q23

Change

y-o-y

2Q24

Change

q-o-q


9M24

9M23

Change

y-o-y

INCOME STATEMENT HIGHLIGHTS










Interest income 

1,115,448

706,871

57.8%

1,072,421

4.0%


2,953,642

2,003,455

47.4%

Interest expense 

(474,412)

(286,895)

65.4%

(454,086)

4.5%


(1,256,451)

(815,670)

54.0%

Net interest income 

641,036

419,976

52.6%

618,335

3.7%

 

1,697,191

1,187,785

42.9%

Fee and commission income 

237,407

168,108

41.2%

240,319

-1.2%


660,110

521,808

26.5%

Fee and commission expense 

(103,307)

(49,159)

110.1%

(89,657)

15.2%


(267,546)

(201,392)

32.8%

Net fee and commission income 

134,100

118,949

12.7%

150,662

-11.0%

 

392,564

320,416

22.5%

Net foreign currency gain

153,023

97,790

56.5%

151,886

0.7%


395,449

268,460

47.3%

    Net other income without one-offs

9,501

5,738

65.6%

28,112

-66.2%


45,406

96,476

-52.9%

    One-off other income

-  

-  

-

-  

-


-  

21,061

NMF

Net other income

9,501

5,738

65.6%

28,112

-66.2%

 

45,406

117,537

-61.4%

Operating income

937,660

642,453

45.9%

948,995

-1.2%

 

2,530,610

1,894,198

33.6%

Salaries and other employee benefits

(203,484)

(106,739)

90.6%

(217,152)

-6.3%


(526,947)

(305,510)

72.5%

Administrative expenses

(72,528)

(46,081)

57.4%

(70,247)

3.2%


(191,155)

(130,940)

46.0%

Depreciation, amortisation and impairment

(47,285)

(31,247)

51.3%

(47,062)

0.5%


(125,838)

(89,592)

40.5%

Other operating expenses 

(3,137)

(1,247)

151.6%

(3,360)

-6.6%


(8,353)

(2,807)

197.6%

Operating expenses 

(326,434)

(185,314)

76.2%

(337,821)

-3.4%

 

(852,293)

(528,849)

61.2%

Gain on bargain purchase

-  

-  

-

-  

-


685,888

-  

NMF

Acquisition related costs

-  

-  

-

679

NMF


(16,423)

-  

NMF

Profit from associates

502

302

66.2%

378

32.8%


978

1,202

-18.6%

Operating income before cost of risk

611,728

457,441

33.7%

612,231

-0.1%

 

2,348,760

1,366,551

71.9%

Expected credit loss on loans to customers and factoring receivables

(12,363)

(27,762)

-55.5%

(79,472)

-84.4%


(109,179)

(105,752)

3.2%

Expected credit loss on finance lease receivables

428

(1,437)

NMF

(1,540)

NMF


(1,284)

(1,248)

2.9%

Other expected credit loss and impairment charge on other assets and provisions 

6,719

(6,606)

NMF

(6,884)

NMF


(5,648)

(9,255)

-39.0%

Cost of risk 

(5,216)

(35,805)

-85.4%

(87,896)

-94.1%

 

(116,111)

(116,255)

-0.1%

Net operating income before non-recurring items

606,512

421,636

43.8%

524,335

15.7%

 

2,232,649

1,250,296

78.6%

Net non-recurring items 

-  

58

NMF

-  

-


-  

-  

-

Profit before income tax expense

606,512

421,694

43.8%

524,335

15.7%

 

2,232,649

1,250,296

78.6%

Income tax expense

(97,259)

(64,330)

51.2%

(93,668)

3.8%


(254,876)

(183,079)

39.2%

Profit 

509,253

357,364

42.5%

430,667

18.2%

 

1,977,773

1,067,217

85.3%

 










Attributable to:










- shareholders of the Group

507,272

355,803

42.6%

427,944

18.5%


1,971,452

1,062,654

85.5%

- non-controlling interests

1,981

1,561

26.9%

2,723

-27.2%


6,321

4,563

38.5%

 










Basic earnings per share

11.71

8.12

44.2%

9.79

19.6%

 

45.12

23.76

89.9%

Diluted earnings per share

11.49

7.92

45.1%

9.62

19.4%

 

44.29

23.22

90.7%

 




















BALANCE SHEET HIGHLIGHTS

Sep-24

Sep-23

Change

y-o-y

Jun-24

Change

q-o-q





Cash and cash equivalents

3,413,286

2,959,832

15.3%

3,422,747

-0.3%





Amounts due from credit institutions

2,560,821

1,878,849

36.3%

2,710,729

-5.5%





Investment securities

8,054,364

5,419,376

48.6%

7,825,372

2.9%





Investment securities pledged under sale and repurchase agreements

225,181

-  

NMF

520,916

-56.8%





Loans to customers, factoring and finance lease receivables

31,058,958

19,010,599

63.4%

30,081,566

3.2%





Accounts receivable and other loans

7,193

48,860

-85.3%

7,667

-6.2%





Prepayments

119,292

42,785

178.8%

112,537

6.0%





Foreclosed assets

324,558

237,116

36.9%

308,405

5.2%





Right-of-use assets

239,299

144,422

65.7%

240,868

-0.7%





Investment properties

112,400

132,896

-15.4%

124,334

-9.6%





Property and equipment

534,234

430,181

24.2%

529,715

0.9%





Goodwill

41,253

39,116

5.5%

41,253

0.0%





Intangible assets

301,086

165,475

82.0%

289,284

4.1%





Income tax assets

43,523

786

NMF

2,442

NMF





Other assets

277,803

310,188

-10.4%

289,099

-3.9%





Assets held for sale

52,177

29,332

77.9%

21,487

142.8%





Total assets

47,365,428

30,849,813

53.5%

46,528,421

1.8%

 




Client deposits and notes

31,872,416

21,743,543

46.6%

30,706,272

3.8%





Amounts owed to credit institutions

5,701,966

3,163,001

80.3%

6,366,603

-10.4%





Debt securities issued

2,220,896

425,560

NMF

2,128,224

4.4%





Lease liability

249,929

145,517

71.8%

253,457

-1.4%





Accruals and deferred income

249,187

106,042

135.0%

220,153

13.2%





Income tax liabilities

68,504

158,956

-56.9%

98,125

-30.2%





Other liabilities

470,988

372,016

26.6%

592,296

-20.5%





Total liabilities

40,833,886

26,114,635

56.4%

40,365,130

1.2%

 




Share capital

1,474

1,511

-2.4%

1,481

-0.5%





Additional paid-in capital

454,881

459,630

-1.0%

439,451

3.5%





Treasury shares

(49)

(69)

-29.0%

(49)

0.0%





Capital redemption reserve

145

107

35.5%

137

5.8%





Other reserves

103,754

29,458

NMF

70,873

46.4%





Retained earnings

5,947,108

4,225,583

40.7%

5,628,354

5.7%





Total equity attributable to shareholders of the Group

6,507,313

4,716,220

38.0%

6,140,247

6.0%

 




Non-controlling interests

24,229

18,958

27.8%

23,044

5.1%





Total equity

6,531,542

4,735,178

37.9%

6,163,291

6.0%

 




Total liabilities and equity

47,365,428

30,849,813

53.5%

46,528,421

1.8%

 




Book value per share

150.46

107.64

39.8%

141.14

6.6%

 




 


Additional information

 

 

Employees (period-end)

Sep-24

Sep-23

Change y-o-y

Jun-24

Change q-o-q

Bank of Georgia (standalone)

7,796

7,185

8.5%

7,748

Ameriabank

1,975

N/A[7]

N/A

1,919

2.9%

Other

2,051

1,884

8.9%

2,052

0.0%

Group

11,822

9,096

30.4%

11,719

0.9%

 

Branch network (period-end)

 

Sep-24

Sep-23

Change y-o-y

Jun-24

Change q-o-q

Bank of Georgia

185

191

-3.1%

182

1.6%

Of which: 






    Full-scale branches

95

90

5.6%

95

0.0%

    Transactional branches

90

101

-10.9%

87

3.4%

Ameriabank

26

N/A[8]

N/A

26

0.0%

 

 

Unadjusted ratios of the Group  

3Q24

3Q23

2Q24

 

 

9M24

9M23

ROAA

4.4%

4.8%

3.9%

 

 

6.5%

5.0%

ROAE

32.1%

30.7%

28.1%

 

 

45.6%

31.7%

Cost:income ratio

34.8%

28.8%

35.6%

 

 

33.7%

27.9%

 

FX rates

Sep-24

Sep-23

Jun-24

GEL/USD exchange rate (period-end)

2.73

2.68

2.81

GEL/GBP exchange rate (period-end)

3.66

3.29

3.55

GEL/1000AMD exchange rate (period-end)

7.05

6.74

7.25

Shares outstanding

Sep-24

Sep-23

Jun-24

Ordinary shares outstanding (period-end)

43,249,397

43,816,379

43,504,016

Treasury shares outstanding (period-end)

1,477,586

2,098,344

1,480,930

Total shares outstanding (period-end)

44,726,983

45,914,723

44,984,946

 

 

 


Glossary

 

Strategic terms

§ Active merchant At least one transaction executed within the past month

§ Active POS terminal At least one transaction executed within the past month

§ MAC (Monthly active customer - retail or business) Number of customers who satisfied pre-defined activity criteria within the past month

§ Digital monthly active user (Digital MAU) Number of retail customers who logged into our mBank/iBank/sCoolApp at least once within the past month; when referring to business customers, Digital MAU means number of business customers who logged into our Business mBank/iBank at least once within the past month

§ Digital daily active user (Digital DAU) Average daily number of retail customers who logged into our mBank/iBank/sCoolApp at least one within the past month

§ Payment MAU Number of retail customers who made at least one payment with a BOG card within the past month 

§ Net Promoter Score (NPS) NPS asks: on a scale of 0-10, how likely is it that you would recommend Bank of Georgia to a friend or a colleague? The responses: 9 and 10 - are promoters; 7 and 8 - are neutral; 1 to 6 - are detractors. The final score equals the percentage of the promoters minus the percentage of the detractors.

 

Ratio definitions and abbreviations

§ Alternative performance measures (APMs) In this announcement the management uses various APMs, which we believe provide additional useful information for understanding the financial performance of the Group. These APMs are not defined by International Financial Reporting Standards, and also may not be directly comparable with other companies who use similar measures. We believe that these APMs provide the best representation of our financial performance as these measures are used by the management to evaluate the Group's operating performance and make day-to-day operating decisions

§ Basic earnings per share Profit for the period attributable to shareholders of the Group divided by the weighted average number of outstanding ordinary shares over the same period

§ Book value per share Total equity attributable to shareholders of the Group divided by ordinary shares outstanding at period-end; Ordinary shares outstanding at period-end equals number of ordinary shares at period-end less number of treasury shares at period-end

§ CBA Central Bank of Armenia

§ CBA Common Equity Tier 1 (CET1) capital adequacy ratio Common Equity Tier 1 capital divided by total risk weighted assets, both calculated in accordance with the requirements of the CBA

§ CBA Tier 1 capital adequacy ratio Tier 1 capital divided by total risk weighted assets, both calculated in accordance with the requirements of the CBA

§ CBA Total capital adequacy ratio Total regulatory capital divided by total risk weighted assets, both calculated in accordance with the requirements of the CBA

§ CBA Liquidity coverage ratio (LCR) High-quality liquid assets divided by net cash outflows over the next 30 days (as defined by the CBA)

§ CBA Net stable funding ratio (NSFR) Available amount of stable funding divided by the required amount of stable funding (as defined by the CBA

§ Cost of credit risk ratio Expected loss on loans to customers, factoring and finance lease receivables for the period divided by monthly average gross loans to customers, finance lease and factoring over the same period (annualised where applicable)

§ Cost of deposits Interest expense on client deposits and notes for the period divided by monthly average client deposits and notes over the same period (annualised where applicable)

§ Cost of funds Interest expense for the period divided by monthly average interest-bearing liabilities over the same period (annualised where applicable)

§ Cost to income ratio Operating expenses divided by operating income

§ FC Foreign currency

§ Interest-bearing liabilities Amounts owed to credit institutions, client deposits and notes, and debt securities issued

§ Interest-earning assets (excluding cash) Amounts due from credit institutions, investment securities (but excluding corporate shares) and loans to customers, factoring and finance lease receivables

§ IFRS-based NBG Liquidity coverage ratio (LCR) High-quality liquid assets divided by net cash outflows over the next 30 days (as defined by the NBG). Calculations are made for Bank of Georgia standalone, based on IFRS

§ IFRS-based NBG Net stable funding ratio (NSFR) Available amount of stable funding divided by the required amount of stable funding (as defined by the NBG). Calculations are made for Bank of Georgia standalone, based on IFRS

§ LC Local currency

§ Leverage (times) Total liabilities divided by total equity

§ Liquid assets Cash and cash equivalents, amounts due from credit institutions and investment securities

§ Loan yield Interest income from loans to customers, factoring and finance lease receivables for the period divided by monthly average gross loans to customers, factoring and finance lease receivables over the same period (annualised where applicable)

§ NBG National Bank of Georgia

§ NBG (Basel III) Common Equity Tier 1 (CET1) capital adequacy ratio Common Equity Tier 1 capital divided by total risk weighted assets, both calculated in accordance with the requirements of the NBG. Calculations are made for Bank of Georgia standalone, based on IFRS

§ NBG (Basel III) Tier 1 capital adequacy ratio Tier 1 capital divided by total risk weighted assets, both calculated in accordance with the requirements of the NBG. Calculations are made for Bank of Georgia standalone, based on IFRS

§ NBG (Basel III) Total capital adequacy ratio Total regulatory capital divided by total risk weighted assets, both calculated in accordance with the requirements of the NBG. Calculations are made for Bank of Georgia standalone, based on IFRS

§ Net interest margin (NIM) Net interest income for the period divided by monthly average interest earning assets excluding cash and cash equivalents and corporate shares over the same period (annualised where applicable)

§ Non-performing loans (NPLs) The principal and/or interest payments on loans overdue for more than 90 days; or the exposures experiencing substantial deterioration of their creditworthiness and the debtors assessed as unlikely to pay their credit obligation(s) in full without realisation of collateral

§ NPL coverage ratio Allowance for expected credit loss for loans to customers, finance lease and factoring receivables divided by NPLs

§ NPL coverage ratio adjusted for discounted value of collateral Allowance for expected credit loss for loans to customers, finance lease and factoring receivables divided by NPLs (discounted value of collateral is added back to allowance for expected credit loss)

§ One-off items Significant items that do not arise during the ordinary course of business

§ Operating leverage Percentage change in operating income less percentage change in operating expenses

§ Return on average total assets (ROAA) Profit for the period divided by monthly average total assets for the same period (annualised where applicable)

§ Return on average total equity (ROAE) Profit for the period attributable to shareholders of the Group divided by monthly average equity attributable to shareholders of the Group for the same period (annualised where applicable)

§ NMF No meaningful figure

 

Constant currency basis

To calculate the q-o-q growth of loans and deposits without the currency exchange rate effect, we used the relevant exchange rates as of 30 June 2024. To calculate the y-o-y growth without the currency exchange rate effect, we used the relevant exchange rates as at 30 September 2023. Constant currency growth is calculated separately for GFS and AFS, based on their respective underlying performance.



 

Bank of Georgia Group PLC profile

Bank of Georgia Group PLC (the "Company" or the "Group" when referring to the group companies as a whole) is a FTSE 250 holding company whose subsidiaries provide banking and financial services focused in the high-growth Georgian and Armenian markets through leading, customer-centric, universal banks - Bank of Georgia in Georgia and Ameriabank in Armenia. By building on our competitive strengths, we are committed to driving business growth, sustaining high profitability, and generating strong returns, while creating opportunities for our stakeholders and making a positive contribution in the communities where we operate.

Bank of Georgia Group PLC is listed on the London Stock Exchange's main market in the Equity Shares (Commercial Companies) category and is a constituent of the FTSE 250 index. Ticker: BGEO.

Legal entity identifier: 213800XKDG12NQG8VC53

Registered address: 29 Farm Street, London, W1J 5RL, United Kingdom; Registered under number 10917019 in England and Wales

Company secretary: Computershare Company Secretarial Services Limited (The Pavilions, Bridgwater Road, Bristol BS13 8FD, United Kingdom)

Registrar: Computershare Investor Services PLC (The Pavilions Bridgwater Road, Bristol BS99 6ZZ, United Kingdom)

Please note that Investor Centre is a free, secure online service run by our Registrar, Computershare, giving you convenient access to information on your shareholdings.

Investor Centre Web Address: www.uk.computershare.com/Investor/#Home

Investor Centre Shareholder Helpline: +44 (0)370 873 5866

Auditors: Ernst & Young LLP (25 Churchill Place Canary Wharf, London E14 5EY, United Kingdom)

 

Contacts:

Email: [email protected]

Telephone: +44(0) 203 178 4052

Michael Oliver (Advisor to the CEO): [email protected]; +44 203 178 4034

Nini Arshakuni (Head of Investor Relations): [email protected]; +995 322 444 444 (7515)

Further information

For more on results publications, go to Results Centre on www.bankofgeorgiagroup.com/results/earnings

For more on investor information, go to www.bankofgeorgiagroup.com/information/shareholder

For news updates, go to www.bankofgeorgiagroup.com/news

For share price information, go to www.bankofgeorgiagroup.com/information/share-price

Forward-looking statements

This announcement contains forward-looking statements, including, but not limited to, statements concerning expectations, projections, objectives, targets, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions, competitive strengths and weaknesses, plans or goals relating to financial position and future operations and development. Although Bank of Georgia Group PLC believes that the expectations and opinions reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations and opinions will prove to have been correct. By their nature, these forward-looking statements are subject to a number of known and unknown risks, uncertainties and contingencies, and actual results and events could differ materially from those currently being anticipated as reflected in such statements. Important factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements, certain of which are beyond our control, include, among other things: macro risk, including domestic instability; geopolitical risk; credit risk; liquidity and funding risk; capital risk; market risk; regulatory and legal risk; conduct risk; financial crime risk; information security and data protection risks; operational risk; human capital risk; model risk; strategic risk; reputational risk; climate-related risk; and other key factors that could adversely affect our business and financial performance, as indicated elsewhere in this document and in past and future filings and reports of the Group, including the 'Principal risks and uncertainties' included in Bank of Georgia Group PLC's Annual Report and Accounts 2023 and in 1H24 Results. No part of this document constitutes, or shall be taken to constitute, an invitation or inducement to invest in Bank of Georgia Group PLC or any other entity within the Group, and must not be relied upon in any way in connection with any investment decision. Bank of Georgia Group PLC and other entities within the Group undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent legally required. Nothing in this document should be construed as a profit forecast.



[1] Year-on-year comparisons are given for informational purposes only as Ameriabank was not part of the Group as at 30 September 2023.

[2] In 2Q24, GEL 0.7m was recorded as a one-off item due to a recovery of a small portion of the previously expensed acquisition-related advisory fee. The acquisition of Ameriabank in March 2024 resulted in 1Q24 one-off items totalling GEL 668.8m comprising a one-off gain on bargain purchase (provisional, subject to year-end audit) and acquisition-related costs. 9M24 operating income before cost of risk and subsequent lines in the income statement as well as ROAA and ROAE were adjusted for these one-off items.

Due to the settlement of a legacy claim, the fair value revaluation of the receivable resulted in a one-off other income of GEL 21.1 million posted in 2Q23. Net other income was adjusted for this one-off. As a result, ROAA, ROAE and Cost:income ratio were adjusted for one-off other income in 9M23. Comparisons given in text are with adjusted figures of the respective periods.

[3] Throughout this announcement, gross loans to customers and respective allowance for impairment are presented net of expected credit loss (ECL) on contractually accrued interest income. These do not have an effect on the net loans to customers' balance. Management believes that netted-off balances provide the best representation of the loan portfolio position.

[4] For 9M24, ROAA, net interest margin, loan yield, liquid assets yield, cost of funds, cost of client deposits and notes, cost of amounts owed to credit institutions, cost of debt securities issued, and cost of credit risk ratio were adjusted to exclude the effect of Ameriabank's consolidation at the end of March on average balances.

[5] Includes current accounts, time deposits and issued local bonds.

[6] Ratios are calculated based on quarterly averages.

[7] The number of Ameriabank's employees amounted to 1,655 as of 30 September 2023. The figure is not included in the table, as Ameriabank was not part of the Group as of 30 September 2023.

[8] Ameriabank had 25 branches as of 30 September 2023. The figure is not included in the table, as Ameriabank was not part of the Group as of 30 September 2023.

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