TIDMBGEO
RNS Number : 7103I
Bank of Georgia Group PLC
03 April 2020
London, 3 April 2020
National Bank of Georgia supervisory plan - COVID-19
The National Bank of Georgia (the "NBG"), our banking regulator,
has announced that it has introduced an updated supervisory plan
for the Georgian banking sector. The initiatives under the revised
supervisory plan are aimed at alleviating the negative financial
and economic challenges created by the global COVID-19 pandemic in
Georgia. The measures, which have been introduced with immediate
effect, are mainly focused on capital adequacy and liquidity
initiatives that allow banks to use existing buffers to support
customers in the current financially stressed circumstances, to
continue normal business activities as far as possible, and to
support the economy through ongoing lending operations.
Capital adequacy initiatives:
-- Combined buffer - the conservation buffer requirement of 2.5%
of risk-weighted assets reduced to 0% indefinitely;
-- Pillar 2 requirements:
-- Currency induced credit risk buffer (CICR) requirement
reduced by 2/3rds indefinitely;
-- The phase-in of additional credit portfolio concentration
risk buffer (HHI) and net GRAPE buffer requirements on Common
Equity Tier 1 (CET1) and Tier 1 capital, planned at the end of
March, 2020, has been postponed indefinitely;
-- The possibility of fully or partially releasing the remaining
requirements of Pillar 2 buffers (HHI, CICR, net GRAPE), if
necessary, remains open.
Liquidity initiatives:
-- Liquidity coverage ratio (LCR) requirements (for local and
foreign currency, as well as total requirement) may be revisited
and reduced, if necessary;
-- Mandatory reserve requirements may be revisited and reduced,
if necessary;
-- Eligibility criteria for repo-eligible securities may be
revisited, if necessary, to support GEL liquidity.
Other initiatives:
-- The deadline for submitting previously planned stress testing
results to NBG has been postponed until the end of May, 2020;
-- NBG will not impose any monetary sanctions in case of breach
of economic normatives and limits driven by external factors (e.g.
reserves, exchange rate deprecation);
-- NBG on-site audits, except for ongoing anti-money laundering
reviews, postponed indefinitely;
-- All new regulatory changes and requirements postponed till
September, 2020, or until further communicated by NBG. This does
not apply to regulations with regard to open banking, XBRL
reporting and resolution framework.
During the period the banks are allowed to partially or fully
use the Pillar 2 and conservation buffers, the banks must not make
capital distribution in any form.
Bank of Georgia's (the "Bank") capital adequacy ratios, funding
and liquidity positions have been strong, and remain comfortably
above the Bank's minimum regulatory requirements. As of 29 February
2020, the Bank's liquidity coverage ratio stood at 133.9% and net
stable funding ratio at 130.9%, compared to the 100% minimum
required level. The CET1, Tier 1 and total capital adequacy ratios
were 12.2%, 14.2% and 18.6%, respectively, comfortably in excess of
the respective minimum required levels of 10.2%, 12.2% and 17.1%.
Following the just announced measures, the Bank expects CET1, Tier
1 and Total Capital adequacy minimum ratio requirements of 6.9%,
8.7% and 13.3%, respectively, as of 31 March 2020.
In addition, on 2 April 2020, the Bank drew-down the second
tranche of the US$107 million subordinated syndicated loan facility
signed in December, 2019, in the amount of US$55 million. This is
expected to be treated as a Bank Tier 2 capital instrument under
the Basel III regulation upon approval of the NBG and will further
improve the overall capitalisation of the Bank.
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
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