As a result of the measures taken by the National Bank of Georgia (NBG) aimed at ensuring the stability of the financial system as a whole in Georgia, the financial sector has passed the particularly severe phase of the shock caused by the Covid-19 pandemic 'quite successfully', says the NBG in its recent report.
The imposition of additional capital requirements by the national bank in previous years and the profits made by commercial banks have allowed banks to accumulate sufficient capital buffers to cope with this shock. Accordingly, the banks were prepared to face the shock caused by the pandemic", says the NBG.
The NBG says that the structural challenges of the Georgian economy, such as the high rate of dollarisation, the growing current account deficit and the growing reliance on international financial flows, have exacerbated the negative impact of the prolonged external shocks caused by the Covid-19 pandemic on the Georgian economy.
However, with global vaccination and a faster-than-expected recovery of the world economy, a gradual improvement in the situation is expected, which will be reflected in increased foreign demand and financial inflows", says the NBG.
There are 15 commercial banks in Georgia, including 14 foreign-owned banks and one branch of non-resident banks.
In August 2021, compared to the previous month, the total assets of Georgian commercial banks (in current prices) increased by 0.8% and constituted 57.49 billion GEL.
The banking sector’s equity capital equals 7.11 billion GEL, which makes up 12.38% of the commercial banks total assets.