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Banks’ Credit Portfolio in Georgia Will Exceed GEL 12 Billion in 2014, Zurab Gvasalia

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Operating Income of BG Capital Increased by 37% in 2013

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agement and operational flexibility to address some of the important challenges that have emerged in 2013”, Giorgi Kadagidze, Governor of the National Bank of Georgia, told The FINANCIAL. Continued on p. 4

TBC Bank – Best Bank of Georgia 2014 by Global Finance The FINANCIAL “Our market share in total assets and total loans stood at 25.3% and 27.2% respectively,” Vakhtang Butskhrikidze, Chief Executive Officer of TBC Bank, told The FINANCIAL. “Dur-

enues amounted to GEL 2,425 million in 2013, which is GEL 280 million more than in 2012. As for the net profit, it has grown from GEL 134 million to GEL 389 million. The volume of the banks’ capital increased significantly as well, from GEL 2,390 million to GEL 2,890 million. Continued on p. 12

ing 2013, our gross loan portfolio increased by 16.6% and reached GEL 2,958.6 million. During 2013, total customer deposits increased by 16.1% to 2,886.9 million. Continued on p. 8

Life after Misha? MERAB PACHULIA GORBI

Dear reader,

monthly revenue in Q1 2014 is expected to exceed GEL 10 million, a material improvement q-o-q and a very sizeable one on a y-o-y basis.

Continued on p. 6

Continued on p. 13

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he operating income of BG Capital increased by 37% in 2013 and amounted to GEL 1,128,223. The company opened a branch in Azerbaijan this year. Continued on p. 10

Liberty Bank: Ubiquity Taken to the Next Level

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THE DRAMA OF CHEESE PRICES IN KUTAISI

n March 2014, the national average price of cooking Imeretian khachapuri reached 3.16 GEL, which is 8.9% lower compared to the previous month (February 2014). While experiencing a 7.6% monthly drop in the price of khachapuri (to 3.32 GEL), Tbilisi kept its position as the most expensive city. The biggest monthly decline (18.4%) was observed in Kutaisi. At 2.82 GEL per khachapuri portion, Kutaisi became the cheapest city in our survey. Such a significant decline in the price of khachapuri is driven by the seasonal adjustment in the price of cheese. However, this seasonal adjustment appears to be much more dramatic in Kutaisi: down 30.5% (from 8.20 GEL to 5.70 GEL) as compared to only 14% when looking at the national average. Interestingly enough, cheese price fluctuations are consistently sharper in Kutaisi than anywhere else in Georgia. Year after year, we see the price of cheese in Kutaisi exceeding the national maximum in January and falling below the national minimum in June. A possible explanation has to do with the fact that Kutaisi sits

in the heart of a traditional dairy producing region, with a relatively larger portion of cheese and other dairy products supplied by smallholder farmers. Understandably, the sharp price fluctuations are closely related to the low level of agricultural development in the Imereti region. While Tbilisi gets a part of its supplies from quasi-

industrial farms, Kutaisi receives almost no fresh milk supply in the winter months, and has too much of it in spring and early summer, when dairy product prices collapse given excess supply and limited cold storage capacity in the region. What is interesting, however, is that Georgian traders (“speculators”) and processors have not yet

learned to take advantage of the existing arbitrage opportunities. Cheese prices would have fluctuated much less (over time and space) had traders invested in refrigerator cars and trucks; and had processors invested in cold storage capacity to stock up Imeruli cheese produced from the relatively abundant and cheap summer milk.

Fine and Punishment by MICHAEL FUENFZIG ISET Policy Institute

magine arriving at a provincial airport in an unnamed Central Asian country. You leave the terminal and go straight to row of waiting taxis. In your Lonely Planet you read that you should pay about $10 for what is a short taxi ride to the city center. You ask the first taxi driver and are quoted a fantasy price of $50. You try to bargain, to no avail. You go to the next taxi, and once again you are quoted $50. You finally go to the third taxi, and lo and behold, it’s the same price, $50. And you don’t even try to bargain anymore… Now, imagine this to play out over and over again. When you want to buy gasoline. When you want to buy groceries. When you want to buy medication. Frustrating, wouldn’t it be? Or, to quote Brian Shepard, one of the FBI agents that helped break up the Lysine cartel in the United States in the 1990s: “Everyone in this country is a victim of corporate crime by the time they finish breakfast.” So how would you go about breaking up cartels? How does Georgia go about breaking up cartels? A few days ago the Georgian parliament adopted the draft law “on the Amendments to the Law of Georgia on Free Trade and Competition”. As has been pointed out by Transparency Georgia, this new law introduces several novelties, and has the potential to finally have an impact and to result in the break-up of cartels. So is all now well and good with this new law? Will cartels be broken up and involved firms be fined and punished? Will Georgian con-

sumer enjoy lower prices for gasoline, pharmaceuticals, and food? On paper, the new law should give reason for optimism. The new law establishes an independent competition agency, it defines what is and what is not unfair competition, and it stipulates fines for anti-competitive practices. Importantly, these fines are defined as percentage of annual revenue and are supposed to be proportional to the damage, the duration, and the scope of the anti-competitive practice. The law is thus very much in line with EU competition law. Which is not surprising given that competition was and is a key point in the negotiations on the Deep and Comprehensive Free Trade Agreement between Georgia and the European Union. In theory fines of up to five percent (up to ten percent for repeat offenders) of annual revenue provide a strong deterrent against anti-competitive behavior. But as usual the devil is in the details. Here are a few reasons why: 1. Imagine two firms fixing prices in the retail gasoline market. One firm is well-diversified, not just selling gasoline but also providing other services – from fast food over grocery retail to car repair. The other firm is highly specialized, selling gasoline, and only gasoline. With fines being proportional to annual retail deterrence is strong for the former, but weaker for the latter. This is a problem as it distorts the decisions of firms to diversify or specialize. 2. Imagine a pharmacy chain selling pharmaceuticals, and a pharmaceutical firm manufacturing said pharmaceuticals. Likely the profit/revenue ratio will be lower for the former, the

downstream firm, and higher for the latter, the upstream firm. This also poses a problem for the competition agency as fines have to take into account market and firm characteristics, in order for the fine to be appropriate. 3. Cartels increase their member’s profits by increasing prices and reducing market sales (or in other words, revenue). With fines being proportional to annual revenue competition policy gives an additional incentive for firms to increase prices and reduce market sales even further, thus increasing the damage to consumers. In principle all these could be resolved by fine-tuning fines, not only taking into account the damage, the duration, and the scope of the anti-competitive practice, but also the characteristics of involved firms and markets. This certainly is a tall order. And requires experience and expertise from the new competition agency. Even worse, there is the following: 4. Consider an extreme example – a cartel in the banking sector. Impose large fine and financial stability will be gone. Under these circumstances, can fines be a credible deterrent? 5. Consider a less extreme example –a cartel in the grocery retail sector. Impose large fines, and not only the cartel, but also some retailers will go. Can we be sure that the market will be more competitive, not less? 6. Fines imposed on cartels will be paid by consumers or shareholders, and not by those who are the real culprits: The managers who decided that it is ok to cheat consumers, and to reduce or eliminate competition with illegal practices.

What could be done instead? The competition agency could punish individuals and not firms, making anti-competitive practices a criminal offence. While certainly not without its own problems, criminal sanctions would provide a strong deterrent and would go a long way to alleviate distortions brought about by pecuniary fines. There is of course a reason why criminal sanctions are not part of the new competition law. While criminal sanctions are common in the US, they are not in the European Union (except for some limited use in a few individual EU member countries). Quite simply, given the need and the intention to emulate EU competition law in Georgia they are not the best starting point for Georgia. This leaves but one strategy to deal with the unintended consequences of fines: Invest not only into the legal but also the economic expertise of the new competition agency. For several reasons. One, trivially, to understand the anti-competitive practices employed by firms, and the damage caused. Second, to ensure that the economic consequences of fines, both ex-ante and ex-post, are properly understood. Third, to provide for transparent and predictable sanctions by developing guidelines and procedures for the determination of fines, to allow firms to anticipate the consequences of anti-competitive practices. Recommended for further reading are Vasiliki Bageri, Yannis Katsoulacos and Giancarlo Spagnolo, “The Distortive Effects of Antitrust Fines Based on Revenue”, SITE Working Paper 22, 2012 and the Fall 2010 issue of the Competition Policy International Journal with the colloquium “Who Should Be the Target of Cartel Sanctions?”

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NBG: External Shocks Remain a Significant Risk The FINANCIAL By MADONA GASANOVA

Low Larization level is one of the persistent problems and creates many problems in the sector including currency induced credit risk, procyclicality and lower transition channel for monetary policy.

ncreasing activity on the lending market is predicted to be one of the main challenges for the Georgian banking sector this year. It is not recommended for growth of the loan portfolio to happen at the expense of lending standards. External shocks provide a reason to worry, but from a prudential side banks remain well insulated against them. Despite the high growth rates of the past, the size of the Georgian banking system is still relatively low and has significant future growth potential. “The banking sector has displayed robust risk management and operational flexibility to address some of the important challenges that have emerged in 2013”, Giorgi Kadagidze, Governor of the National Bank of Georgia, told The FINANCIAL. “The low economic growth environment in the first 3 quarters of 2013 dampened loan demand and required banks to reorient their business models towards the segments that were more resource intensive but had relatively higher growth potential. Banks have concentrated on SME and retail sectors, rather than on large corporate. As demand for loans declined, competition on the loan market has intensified and led to a decrease in interest rates. This was also supported by an increasing saving rate in the overall economy. Increased competition has created incentives for banks to increase their efficiency. Efficiency gains did not compromise risk management. On the contrary, we are observing gradual improvements in risk management practices. Improved overall asset quality is the primary result of this. We also observe a declining share of procyclical sectors in the portfolio making the overall financial system more resilient,” Giorgi Kadagidze said. “Despite intensified completion, improvements in the efficiency and greater scale economies stemming from banking assets growth should enable banks to maintain reasonable profitability targets in 2014. This expectation will likely be impacted by unexpected external shocks and will largely depend on the development of the economy and the political situation in the region as well,” said Kadagidze. Q. You will maintain your position as President of NBG till 2016. What is the task that you want to fulfil while governing Georgian banks? A. The ultimate goal is for the financial system to become more supportive of economic development and to insure individuals and businesses against economic shocks by affordable and readily available access to finance. Growth of the financial system along its benefits also brings an increase in systematic risk as sectors whose shocks were uncorrelated become connected through the financial system. This can help the propagation of shocks and increase the socalled market beta of leveraged firms. To fight the increase of such risks it is necessary for the financial system to maintain greater resilience as financial depth grows. Operationally, this means constant enhancement of risk management practices in banks, con-

GIORGI KADAGIDZE, GOVERNOR OF THE NATIONAL BANK OF GEORGIA

stant enhancement of supervisors’ capabilities to identify and mitigate risks, greater capabilities to look beyond micro prudential risks and enhance macro prudential oversight. This is a continued process and what was enough 5 years ago is not enough today, and what is acceptable today will be outdated in 5 years. Efficiency has greater benefits for society but the cost of financial crises could be significantly larger. We always keep in mind tradeoff between efficiency and risks when designing prudential and monetary policy. Good policy is one that does not compromise this tradeoff but moves the system to higher efficiency and lower risks. Risk-based supervision and streamlining of the supervisory process is one example of such policy. Ongoing convergence to European capital and other banking directives will further support such policy, increase investor confidence and prepare grounds for the sector’s integration with EU financial markets. Q. Commercial banks avoid issuing long term credits. That hampers the development of business in Georgia. What can stimulate and ensure that banks issue long term business loans? A. This is one of the main challenges for NBG, to create an environment where banks will be able to issue more long-term loans with affordable interest rates. Banks, while doing their job collecting short term liabilities and issuing long term loans, are facing two main risks: interest rate risk and liquidity risk. Our job is to minimize these risks. To do this we have supported the emergence of floating rate loans that are the most widespread type of loans in other countries. To create additional liquidity buffers, so banks can do more maturity transformation, we expanded the collateral base for monetary operations, worked with the Government and IFIs in order for them to issue more securities that are used in liquidity management by commercial banks. All these measures have been successful. During 2013 long-term crediting in the local currency has significantly improved, interest rates have decreased sharply, 15-20 year mortgages in the

local currency and loans to legal entities have become popular. These have improved monetary policy transmission and supported economic growth. Q. In February you increased the rate of refinancing and it currently stands at 4%. Increased interest rates on loans were the immediate result of your policy. Why did you see the importance of increasing the refinancing rate and how far can the interest rates on loans increase? A. The monetary policy rate changes made by the National Bank of Georgia are directed towards our main mandate - price stability. By changing interest rates according to this objective, we will achieve lowest possible interest rates on long term lending that will in turn support high and sustainable economic growth in the long run. NBG makes decisions based on future inflation not on current inflation. If expected inflation is above the target rate in the medium-term, NBG increases its refinancing rate. We explain our decision in a press release that follows the committee meeting and later in “Inflation Report”. With the move NBG started to withdraw the accommodative monetary policy but at the moment policy stance is still expansionary. Further change on the policy is data dependent, we need to see in the coming months how fast domestic demand picks up. In other words policy rate will change according to the business cycle of the economy and if we look in the long term perspective the policy rate on average will be at its neutral rate, which is around 6.5 percent taking into account that the inflation target is 5 percent starting from 2015. Q. What is the social responsibility of banks in Georgia? Do you think that banks should invest more in their social projects? A. Considering the importance of the issue, socially responsible banking has been one of the priorities for Georgian banks. This is reflected in credit standards as banks study the creditworthiness of the applicant before granting a loan. Banks do not engage so-called “asset backed loans”

practice which could result in severe social consequences. In should be noted that the number of foreclosures for commercial banks is very low compared to the general statistics. In addition, banks frequently try to initiate and engage in educational events aimed at raising the financial literacy of existing, as well as potential consumers. For example they deliver public lectures, visit schools and universities, provide SMEs with the basics of business education and advice such as budgeting, etc. Q. What is the percentage of borrowers who have lost their property due to their debt to banks? Do you think that there should be more protection for bank customers? A. Collateral is a fundamental characteristic of the loan and around the world it is used to mitigate credit risk. Banks primarily use collateral as a means to enhance incentives of the borrowers to honour their obligations. Expected source of repayment when granting a loan is always the income of the borrower and banks study the debt repayment capacity of the borrower in greater detail. Repossession of the collateral is an extreme and inefficient measure (there is regulatory disincentive on repossessed assets in the form of progressively increasing provisioning on reposed property) and banks always try to avoid it. Repossessed assets are small. NBG tries not to interfere in the financial market mechanism unless severe market externalities are evident which interfere with the efficiency of the market and/or create financial stability risks. Consumer protection rules were designed to increase transparency of the contracts, make them more user-friendly and increase disclosure of information on products. This facilitates better decision making on the market. We are well aware that consumer protection rules impose a degree of standardization on products and too strict regulations could discourage innovation of new, consumer’s welfare improving products on the market. Therefore it is important to try to keep the optimal balance between consumer protection rules and innovation and advance consumer protec-

tion agenda as financial products develop and become more complicated. Our consumer protection team is very active and interferes vigorously on behalf of customers whenever inappropriate bank behaviour is observed. Q. NBG asked banks to simplify contracts and make it clearer for easy understanding. But as we observed, there has been no visible progress in this regard. What is the reason for that? A. Banks do observe consumer protection rules and all qualified contracts are modified accordingly. NBG is very vigilant with regard to compliance to these rules. “Mystery shopper” and other techniques are employed to find compliance problems. Anybody who has evidence that there are cases of non-compliance can contact the consumer protection unit on our hotline 2 406 406. Q. There is large public interest in information regarding the official and concrete owners of commercial banks. Do you support its publication? A. We do support it and have been doing this for many years already. The list of ultimate beneficial owners of banks is transparent and published on our website. Transparency is one of the cornerstones of our approach and not only the beneficial owners but also the financial information of banks is disclosed quarterly. Disclosure requirements will be further enhanced as Basel’s pillar 3 will become operational from next year. Q. Which were the most prioritized types of businesses for financing for commercial banks in 2013 and which will be in 2014? A. As was already mentioned, banks mainly expanded in the retail and SME sectors. Economic growth patterns of 2014 will strongly influence the composition of the sectorial growth of the portfolio. In terms of resources. banks are well capitalized and posed to support the growing sectors of the economy. Q. What will be the main challenge for the Georgian banking sector in 2014? A. In this year banks’ main challenge will be to increase activity on the corporate lend-

ing market. There is greater awareness that growth of the loan portfolio should not happen at the expense of lending standards. The international conference organized by NBG in January was intended to highlight potential shortcomings and ways to enhance risk management in this regard. External shocks remain a significant risk but from the prudential side banks remain well insulated against them as banks have diversified sources of funding and hold additional resources for riskier sources of funding. Low Larization level is one of the persistent problems and creates many problems in the sector including currency induced credit risk, procyclicality and lower transition channel for monetary policy. Measures undertaken by us to increase Larization had a positive effect but remain limited. Unfortunately, despite many years of macroeconomic stability, sound performance of the GEL as a currency and significant interest rate premium, the Georgian population predominantly still saves in FX and significant markets (property and car markets) remain dollarized. All this feeds in to inefficiency and higher risks of the banking sector which has to deploy additional risk management tools and costly risk mitigation strategies. In 2014 Basel III regulation, including LCR’s liquidity requirements, becomes effective. Banks have to update risk management capabilities and enhance to better manage their economic capital which will be reflected in the ICAAP submission process and subsequently assessed by supervisors. Q. What are the main advantages and disadvantages of the Georgian banking sector? A. The main advantages of the sector are its flexibility and solid fundamentals reflected in good capital and liquidity buffers. The regulatory environment is conservative and at the same time open and transparent. Still, low financial depth creates potential for sustainable growth prospects for the sector. A well-developed credit information bureau is an important factor contributing to the better risk management on the retail market. The disadvantage of the sector is its relatively small size which inhibits one from fully utilising economies of scale. A significant problem remains low accounting standards and transparency of borrowers. Georgia has a well developed banking sector that by its nature supplies low risk and relatively short term capital to the economy. The high risk and long term segment of the financial market is extremely underdeveloped. This has an adverse effect on the economy and on the development of the banks themselves which usually complement this type of capital by loans. A future challenge for financial development is to jump start and enhance these sectors of the financial market as well.

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Liberty Bank: Ubiquity Taken to the Next Level We are proud to service the highest number of retail clients in the country. An innovative approach to expanding our channels took our ubiquity to the next level and has enabled us to service clients at 700 points instead of the less than 200 in 2009.

GEORGE ARVELADZE, Director General at Liberty Bank

The FINANCIAL By MADONA GASANOVA

et Interest Income of Liberty Bank increased by 11.1% y-o-y to GEL 60.6 million in 2013. The improved operating performance of the Bank in Q4 2013 well positioned the Bank for a confident start to 2014. Partnership with Smartex enabled the Bank to reach over one million younger clients. Meanwhile the elderly population in Georgia has kept up well with technological developments. More than 30% of their transactions have shifted to remote channels. “Based on January’s results, the Bank’s average monthly revenue in Q1 2014 is expected to exceed GEL 10 million, a material improvement q-o-q and a very sizeable one on a y-o-y basis. As our retail lending franchise continues to perform well, our Net Loans has grown in Q1 2014 by approximately GEL 50 million, which will provide a solid foundation for the further improvement in operating profitability in Q2 2014, before the capital constraint kicks in once again. Overall,

if we succeed in reaching our annual targets, the Bank may be expected to achieve in 2014 ROAE of approximately 12%. This, however, is predicated on being able to sustain the rapid growth of the loan book, notwithstanding the capital constraint which will become more pronounced later in the year,” said George Arveladze, Director General at Liberty Bank. Q. How does Liberty Bank position itself among the other banks in Georgia? A. Currently Liberty Bank is the third largest bank by total assets, having started as 7th in 2009. We are proud to service the highest number of retail clients in the country. An innovative approach to expanding our channels took our ubiquity to the next level and has enabled us to service clients at 700 points instead of the less than 200 in 2009; and importantly, the last four years have been profitable, enabling us to regain customer and shareholder confidence. Q. Please can you describe the recent trends in your bank’s development? A. To name a few, I would say a rapid commercial

growth outperforming the market almost two times, ubiquity taken to the next level and keeping ourselves in line with the technology, driving higher connectivity in the everyday lives of our customers. In the last four years Liberty has transformed into a higher performing business that can be resilient in a highly developed and competitive banking sector. Most importantly, our increased client base is measurably better able to do what they want to achieve. The Bank itself is better capitalized, highly liquid and better positioned for future commercial opportunities. Q. What have been some of the novelties that you have offered to the market? A. There have been quite a few, however I consider the most significant ones to be the following: new channels and products that helped us to capture unbanked clients and service the existing ones better. We were the first bank in Georgia to introduce mobile branches and agency banking points, processing more than half a million transactions per month and servicing more than 250 vil-

lages in Georgia. USD-based mobile banking was also one of the novelties we’ve pioneered, currently counting more than 70,000 users and growing rapidly due to established partnerships with mobile operators. Liberty Bank also operates one of the largest local payment systems and cards bases in Georgia, which has enabled us to access a significant portion of the unbanked population in 2013 and 2014. Another significant part of the Bank’s turnaround was shifting more than 50% of total transactions to remote and online channels. Q. Is Liberty Bank still mainly a bank for pensioners? A. Liberty Bank has historically been a major player in projects with high social and economic substance; however since 2009 we have attracted an impressive number of new clients and currently the recipients of state pension comprise approximately 50% of our 1.6 million client base. We are also very proud that the elderly population in Georgia has kept up well with technological developments and more than 30% of their transactions have shifted to remote channels.

Liberty Bank’s partnership with Smartex was quite a novelty in terms of acquiring young, technology-savvy clients. The flow of younger clients has led to developing innovative tools for email and mobile marketing, enabling us to reach over one million clients several times per month. Q. Have there been any changes in your corporate social responsibility strategy? A. Absolutely, since 2009 we have put a strong emphasis on giving back to the community. Some examples off the top of my head are: sponsorship of the national teams in rugby and basketball; football teams “Kolkheti”, “Baia”, “Olimpi”; organizing events supporting startups in Georgia - the “Digital Summer” and “Startup Weekend”; and just recently we offered a sponsorship package to Georgian swimmer Irakli Bolkvadze who is likely to compete at the world championship. We are one of few companies in Georgia offering paid internships to up to 30 talented students every year. However we do not limit ourselves to financial support, we stress the importance of communication

with the younger generation, and thus the management board tries to accept every pro bono speaker invitation from a variety of educational and professional institutions. In 2014, we plan to further expand our efforts by offering novelties in social crowd funding and contributing even more to the education and development of the country’s youth. Q. How do you see Liberty Bank developing over the next few years? A. Liberty is already a top player in retail banking, with a rapidly growing market share. Every year we will be more ubiquitous, more connective, technologically advanced with a large and diversified retail and SME customer base. “The bank for everyone, everywhere”.

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TBC Bank – Best Bank of Georgia 2014 by Global Finance The FINANCIAL by MARIAM GOGIBERIDZE “Our market share in total assets and total loans stood at 25.3% and 27.2% respectively,” Vakhtang Butskhrikidze, Chief Executive Officer of TBC Bank, told The FINANCIAL. “During 2013, our gross loan portfolio increased by 16.6% and reached GEL 2,958.6 million. During 2013, total customer deposits increased by 16.1% to 2,886.9 million. During the year 2013 we maintained a leading position in the Georgian banking sector with the largest market share in retail deposits of 33.1%.” TBC Bank is a universal bank with a traditionally strong presence in the corporate segment and key strengths in the retail and SME segments. TBC Bank has maintained the leading position in retail deposits (33.1% market share as of YE 2013) for seven consecutive years. Four prominent IFIs EBRD, IFC, DEG and FMO, together with JP Morgan and Ashmore, hold 65% of TBC Bank shares. Q. Mr Butskhrikidze, how would you evaluate the year 2013 for TBC Bank? A. In the fourth quarter of 2013 Georgia demonstrated a strong economic performance with real GDP growth of 6.9% as a result of accelerated business activities and improved macroeconomic conditions, following a temporary slowdown in economic growth in the first nine months of 2013. The outlook for 2014 is positive with the various forecasts ranging from 5% to 6.6% of real GDP growth. The growth of the Georgian banking sector during 2013 was positively affected by the increased business activities in the fourth quarter of 2013. Consequently, during 2013, Georgian banking sector loans increased by 21.0% to GEL 10.6 billion, resulting from the 29.4% increase in total individual loans and 14.7% increase in total legal entity loans. During the same period, total customer deposits increased by 26.5% to GEL 9.7 billion with individual and legal entity deposits increasing by 24.4% and 28.7% respectively. During the year 2013, we maintained a leading position in the Georgian banking sector with the largest market share in retail deposits of 33.1%. Our market share in total assets and total loans stood at 25.3% and 27.2% respectively. During 2013, our gross loan portfolio increased by 16.6% and reached GEL 2,958.6 million. During 2013, total customer deposits increased by 16.1% to 2,886.9 million. To summarise, in 2013 TBC Bank has continued on its path to sustainable growth and again delivered impressive results against our prudent strategic goals as well as having achieved significant milestones in developing the Bank’s financial strength, capabilities and brand value. Q. How would you evaluate the development of SME business in 2013? A. SME business remains one of the leading segments of the country’s economy. This sector has a big perspective of growth and development. Around 500,000 people are employed in the Georgian business sector, the largest

VAKHTANG BUTSKHRIKIDZE, Chief Executive Officer of TBC Bank

share of which is made up by people employed in small and medium sized business enterprises.

clients free of charge. The Program consists of 7 components each of which is aimed at SME business development.

TBC Bank was also recognized as one of the World’s Best Emerging Markets Banks 2014 by Global Finance Magazine, winning in the “Best Bank in Georgia” category for the third consecutive year.

The SME segment remains one of the key segments for TBC Bank. The Bank serves around 43,000 legal entities, which contribute significantly to the country’s economy. As of 31 December 2013, the SME segment accounted for 13.3% and 15.7% of the Bank’s total loan portfolio and total customer deposits, respectively. Since the end of 2012, SME loans increased by 33.4% and deposits by 58.5%. Due to the core importance of the SME segment we have developed a unique programme to provide SMEs with business education opportunities and help them further their growth. Q. What are the key services that you provide for SMEs in the framework of your Business Support Program and how does it operate? A. The Business Support Program “7 steps to success” offers unprecedented educational and business development services to its SME

SME-targeted services include free trainings financed by ADB. Courses include budgeting, CVP Analyze, Social Media Marketing, HR, and Strategic Management. 1,063 clients have been trained as of the year 2013 in the framework of the programme. Along with free trainings, TBC Bank offers SMEs the exclusive and best-in-class educational web platform www.tbcbusiness. ge (financed by IFC and in partnership with IBM). Here, businesses can find a wealth of educational materials and resources, as well as tailored support from our partners from leading legal and audit companies. Readily available resources include tools for financial accounting, direct selling, and human resource management. The portal also offers pre-set materials, such as agreement forms, template accounting forms, and a Q&A blog. We’ve also developed a SME-tailored, completely new Mobile Bank for legal enti-

ties and an upgraded Internet Bank for legal entities. In 2014, TBC Business Support Program will launch additional services like SMS banking services for legal entities, free business consultation services for SMEs and Business conferences for SMEs. We are very pleased that the Program has been operating very successfully so far and on a daily basis we see an increased number of small and medium enterprises using our programme and developing themselves. Q. What would you cite as your international success story? A. In 2013 TBC Bank received its first global recognition from Global Finance Magazine for its achievements in internet banking - the first such award for any Georgian bank. This is the first international acknowledgement for any Georgian bank. TBC Bank was nominated alongside such in-

financial publications in the world. This success confirms that TBC Bank has developed one of the best internet banks in the world. This encourages us to maintain our leading position as an innovator in the market in the future as well. Along with the award winning internet banking (www. tbconline.ge ) TBC Bank has the leading multichannel distribution platform that includes mobile, iPhone, iPad, kiosk and call centre banking. In fact, TBC was the first bank in Georgia to introduce mobile banking applications for iPhone/Android and Smartphones (2012) and Blackberry and iPad (2013). Just a few weeks ago, TBC Bank was also recognized as one of the World’s Best Emerging Markets Banks 2014 by Global Finance Magazine, winning in the “Best Bank in Georgia” category for the third consecutive year. As you know Global Finance editors select win-

It is very important that TBC Bank is the first Georgian company to have received regional recognition for its CSR efforts in these annual awards.

ternationally recognized financial institutions as Citibank, HSBC, Standard Chartered, Garanti Bank, and Scotiabank. So, it is a great honour for us to receive such prestigious awards from one of the most influential

ners based on the input from industry analysts, corporate executives and banking consultants. Best banks were assessed against criteria such as growth in assets, profitability, strategic relationships, customer service,

competitive pricing, and innovative products. Along with these powerful awards EMEA Finance awarded TBC Bank with two different prizes: Best Bank in Georgia of 2013 Best Corporate Responsibility Performing Bank in Central and Eastern Europe It is very important that TBC Bank is the first Georgian company to have received regional recognition for its CSR efforts in these annual awards. Q. Please can you tell us about last year’s brand update and your Corporate Social Responsibility priorities of 2013? A. Last year was very important for TBC Bank in terms of the marketing innovation that we performed in 2013. We introduced several new marketing campaigns and initiatives that enhance our brand platform and allow for a more direct communication with our customers. These initiatives include sensory marketing launched in 2014 to establish a unique branded customer experience in 10 branches. The two elements of the campaign are: Sound - Generative Soundscape in the branches inspired by Georgian musical traditions creating a relaxing atmosphere; and Scent - a deployed signature Brand Scent, TBC Platinum, designed to stimulate the senses, stir emotions and help neutralize the stresses of the outside world. 2013 was a year of update for our brand as well. We launched the new brand platform using the theme of the Three Musketeers as “Client Heroes” for the TBC Bank brand. The first two campaigns with the new Brand Platform showed outstanding results: incredibly high awareness and comprehension scores contributed to a 46% and 113% increase in number of customer loans disbursed and loan volume, respectively, when compared to the results of the same season in 2012. Q. In terms of Corporate Social Responsibility, what were the Bank’s priorities in 2013? A. Social responsibility priorities in 2013 still covered the development of culture and the arts. Last year TBC Bank continued to develop its online arttelevision Artarea throughout 2013. The television channel that allows Georgian viewers to keep up-to-date with current events in culture, music and art is now available via cable TV throughout the entire country. The second largest direction in CSR was still literature the Literary Award SABA and the Online Bookstore SABA. As you know the awards programme is one of the most respected and anticipated literary events in the country. To date, the Bank has recognized over 100 authors and awarded GEL 325,000 in prizes. The SABA online book store (Saba.com. ge) is especially important as it promotes Georgian literature beyond the country’s borders, as well as allows new authors to be discovered and appreciated. To date, tens of established and up-and-coming writers have created their own electronic books and sold them using our innovative e-book platform. In the future we will continue to follow all of our priorities, further strengthen our business and maintain taking an active part in social development as well.

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 14 APRIL, 2014

Best Georgian Banks

BEST BANK IN GEORGIA 2014 EMEA Finance � Best Bank in Georgia EMEA Finance � Best Corporate Social Responsibility Global Finance � Best Bank in Georgia Global Finance � Best Foreign Exchange Provider in Georgia

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FINANCIAL

14 APRIL, 2014 | FINCHANNEL.COM

Operating Income of BG Capital Increased by 37% in 2013 “THE EU INTEGRATION PROCESS IS THE MOST IMPORTANT AND YET DIFFICULT ASPECT OF OUR ECONOMIC DEVELOPMENT,” IRAKLI KIRTAVA, GENERAL DIRECTOR AT BG CAPITAL The FINANCIAL By MADONA GASANOVA

he operating income of BG Capital increased by 37% in 2013 and amounted to GEL 1,128,223. The company opened a branch in Azerbaijan this year. After 2012 the interest in capital market development was significantly raised. However, despite positive signals, it needs more in-depth analysis and work to completely recognize how comprehensive and important the mission of capital market development is for the improvement of investment environment and economic progress of the country. BG Capital is the leading investment bank (Brokerage Company) in Georgia, successfully operating on the capital market since 2000. It has been a member of the Bank of Georgia Group since 2005. BG Capital offers a wide range of services including brokerage and custodial services, asset management, IPOs and private placements, research and market analysis. Institutional backing from Bank of Georgia provides BG Capital with the ability to interact closely with international investors. BG Capital is capable to trade and make settlements on nearly all of the world’s main stock exchanges through reliable international brokers and international depositaries. In this exclusive interview with The FINANCIAL, Irakli Kirtava, General Director at BG Capital, explains the reasons for the lack of development of the securities market in Georgia and provides recommendations for what is needed for the development of Georgian capital markets. Q. What are the results of the trade on the Georgian stock market; the volume of trades 2013 and which companies/ stocks accounted most for the turnover? A. According to the Georgian Stock Exchange (GSE), the total volume of trade of OTC and eligible securities amounted to GEL 52.5 million. That is three-times higher than it was in 2012 (GEL 17.4 million). Securities of 129 Georgian companies were allowed on the Georgian stock market as of 31 December, 2013. Out of them trade on only five companies’ securities was concluded in GSE System. Total capacity amounted to GEL 530,000. This is a very low figure in comparison with previous years. The turnover on trade session was GEL 8.9

IRAKLI KIRTAVA, General Director at BG Capital

million in 2012. Trade volume of Bank of Georgia shares made up 53.7% on trade sessions; it was followed by Liberty Bank with 44.7%, Caucasus Energy Infrastructure with 2.5%, Teliani Valley - 0.9%, and Liberty Consumer - 0.2%. As for OTC, trading was settled on the stocks of 38 companies. The sum of deals amounted to almost GEL 52 million. The same amount totalled GEL 8.5 million in 2012. OTC transactions by companies were as follows: 52.9% - Poti Shipyard, 23.4% - VTB Bank, 9.5% - “Bavshvta Samkaro”, 4.6% - Isani–Kartu 3.3% - Liberty Bank, 2.5% - Caucasus Energy Infrastructure, and over 2% - Teliani Valley. Q. The quantity of transactions of the Georgian stock market is still low. What are the problems behind the lack of development of the stock exchange and capital market in Georgia? A. The limited transactions on trading sessions are due to ignorance and neglect towards establishing an organized motivation system that would stimulate companies, as well as be attractive to the stock market and investors. Such a motivation system should be based on: professional research of the subject, the local economic reality, Georgian potential and analysis of international practice and trends. Despite some positive messages, the importance of the stock market for the country’s economy has always been insufficiently recognised. Consequently, there was no state interest in the stock market. Various structures failed to focus on working out a combined long-term plan for the development of the stock market and investment environment. Q. Can you highlight what has been done in connection with the capital market development, including any positive steps made by the Government during 2013 of the capital market in the country? A. A draft concept for the development of the capital market was set up by a team of professionals at the beginning of 2013. During the past fifteen years a circle of certain specialists had the desire and several times tried to create such a document. However, due to a lack of governmental interest and absence of political will, an agreed comprehensive concept, or, moreover, strategic development plan of the stock industry still did not exist in Georgia. Newly created Georgian Stock Market Concept presents a detailed

review of the local market, best international practice and analysis of global trends. The project proposes ways to solve the existing problems and ensure prospective development. However, the document does not provide specific instructions. Correct identification of the problems, as well as selection of an alternative solution should be accepted after discussions within specialists, as well as economic and financial circles of the Government. For the improvement and development of the concept, it was introduced to a variety of business representatives, lawyers and financial stakeholders. The Business Association of Georgia (BAG) expressed its interest in the project. The presentation was introduced to the representatives Ministry of Economy, Ministry of Finance, NBG and likewise to the economic and financial committee of the Parliament. It should be noted that the concept of the capital market development has always been a focus of international financial institutions (IFIs). They have huge experience of operating on financial markets. Therefore, an importance of capital market development in Georgia is more obvious for them. Some IFIs carried out (or – have started) researches of the Georgian capital market, pension reform and investment environment in 2013. A research carried out by the World Bank is the most detailed and important one. We also welcome the interest of EBRD and other international organizations towards the Georgian capital market. However, these researches have not yet been published and thus their recommendations are not yet available to market participants. We hope that the recommendations of IFIs that are based on the best practice will be considered by the Georgian Government and will provide beneficial effect already in 2014 and later. In 2013 significant changes were initiated in the securities market law. Some principle issues were decided without conceptual long-term vision. Understandably, that ignited vivid discussions within specialist and business circles. Some of the concrete, specific issues at initial stage shall be preferably discussed within narrow circle of specialists with appropriate professionalism, qualification and experience. Outspoken counterargumentation at this phase regretfully surpassed normal legal process and made media widely engaged in those discussions, which could have been desirable from

the standpoint of transparency and public information, but at the same time was accompanied with biased interpretations and/or excessive sensationalism in case of engagement of inexperienced journalists, what is not rare in Georgia. Therefore, initial discussion would be beneficial to be attended by capital market participant specialists and business stakeholders that are affected by the legislative changes. The budget and finance committee of the Parliament decided to make amendments to the law on the securities market only after holding consultations with local and foreign specialists. The legislative amendments are likely to be made this year. Hopefully, all problematic issues concerning legislation draft will be removed from the agenda as the result of compliance with the EU legislation and European directives. Government of Georgia prepared at the end of 2013 an important and significant project of Social-Economic Strategic Development for 2014-2020 (SDSE/2014-20). We welcome the fact, that the project is focused on the importance of capital market development in terms of access to financial resources. According to the document, the Government plans to support: non-banking financial institutes and stock market development along with the banking sector; development of the stock exchange by creating conducive environment for companies;. encouraging transparency of the companies, increasing the standards of accounting and reporting, and encouraging institutional investors . The Government plans to develop OTC trading with bonds and increase public awareness in the field of the securities market. Q. EBRD recently issued 50 million GEL bonds denominated in Georgian Lari. BG Capital and TBC Bank were the managers and guarantors of the transactions. Which segment is considered to be the potential purchasers and how can that influence the public emission of corporate bonds or other securities? A. We consider this step of EBRD as very positive by several factors: this is the very first case in Georgia of securities issue by one of the leading IFIs; it proves, that the IFI with the highest rating has confidence in the Georgian Lari and in the policy of the National Bank and Government with respetc to National currency; corporate securities with a floating interest rate were issued in Georgia for the first time. Another innovative step was that two leading managers - BG Capital and TBC Bank - guaranteed underwriting - what is a good message to emphasize the positive effects of potential cooperation between financial institutions. It must be noted, that The National Bank and the Ministry of Finance made several changes in legislation which makes bond issuance for IFIs in Georgia easier. We hope that other IFIs will also show an interest in issuing GELdenominated securities. This will motivate the leading companies in Georgia to raise the quality of their financial re-

ports and transparency and to attract financial resources through placing securities, which is one of the preconditions of capital market development. Considering the high rating of the issuer such bonds distinguish with high degree of reliability and therefore with the low interest rate. Investing in such financial instruments is mostly attractive for commercial banks and financial organizations (among them – international ones), which are focused on diversifying the risks and investment portfolio. Q. Some local experts as well as commercial banks have demanded that banks be banned from carrying out nonprofile (non-banking) activities. BG Capital is the daughter company of Bank of Georgia. Are there any advantages that you have over your competitors? A. Any idea before it is fulfilled needs an analysis –with the aim of accurate prediction of expected results. I have not heard of any one demanding that banks be prohibited from sharing companies delivering financial services. If such a requirement arises it will be a big mistake caused by a lack of competence in a practice established globally. As for the other non-profile assets, it would be better to wait for the legislative changes, and compliance with the EU Association Agreement. We need to recognize and gradually establish the basic principles that have been adapted and adopted by dozens of European countries. By this approach we will reduce the social and economic risks, which could be inevitable in case of rapid and well-accounted decisions. As for relations with competitors, in brokerage and investment-banking business competitors appear as counterparts and partners. All the investment bankers and brokers realise that a competitive environment is important for the liquidity of securities. BG Capital has always maintained a good working relationship with other brokerage companies. We cooperate on problematic and legislative issues. We also help our colleagues to operate on international markets. Pro-activity, progress and future orientation, implementing innovations and being the leader on the securities market have always been our advantages since 2000 and up today. We have been focused on ensuring the company’s growth and financial stability. With our team of high-level professionals we have close relations with the leading and most trusted international financial institutions, brokerage firms and international depositaries, global custodians, institutional investors, etc. The support of Bank of Georgia is really important in this regard. At the same time, it is a great responsibility for us. I believe in free competition. Artificially loose competition created by limiting the work of developed institutions seems inappropriate to me. We should not ignore the axiom that forceful methods always have negative results. Q. How would you estimate the year 2013 for your company - what are your expectations for 2014?

A. 2013 turned out to be much better than 2012. The operating income (revenue) of the company increased by 37% in 2013 and amounted to GEL 1,128,223. We had serious growth in operating profit, which amounted to GEL 567,333. We had significant trades mainly at international markets, including the Eurobonds. We have served to some Georgian companies as financial adviser. Involvement in the bonds issued by EBRD was an important activity. In 2014 we opened a branch in Azerbaijan. We are running significant preparatory works including serving Georgian companies in issuing corporate public bonds. We are expecting several important transactions that seem quite promising. Q. What will be the main challenges for the Georgian economy in 2014 - in terms of improving the capital market’s investment climate specifically, and what are your suggestions in this regard? A. The EU integration process should be considered the most important, though yet difficult aspect for economic development. Joining DCFTA is undoubtedly significant. To implement standards equal to the ‘civilized world’ will require hard work, professionalism and responsibility. Significant efforts will be carried out in almost all areas in terms of legislative amendments. The large volume of work is associated not only with significant impact, but first of all – with highest level responsibility. It is imperative that our steps be carried out with the involvement of international experts and local professionals. The business community and the public should be provided with high-quality information. We can consider project of social-economic strategy as a fundament for development of capital market and investment environment but we must admit that some issues of the project needs to be extended with respect to relevant directions of conceptual visions and elaboration of detailed action plans for certain industries. It is necessary to determine the structures responsible for creating strategic documents of developing such sectors and for its final recognition. The governmental, regulatory and legislative structures together with market participants and leading business associations should work on a progressive approach based on international practice. A long-term, complex strategy should be implemented. Appropriate actions should be taken step by step. I am optimistic that these approaches will result in achievement of breakthrough developments of the country’s economy, capital market and investment climate of Georgia since 2014.

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 14 APRIL, 2014

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Best Georgian Banks

FINANCIAL

14 APRIL, 2014 | FINCHANNEL.COM

Tbilisi International Airport – One of the best airports in the Eastern Europe

n “Skytrax World Airport Awards” held in Barcelona Tbilisi International Airport was named among one of the best Airports in the Eastern Europe. “Tbilisi International Airport provides services to more than 1.4 million passengers a year- It was in the result of passenger surveys that Tbilisi International Airport was named as one of the best airport in the Eastern Airport. We are happy that under the operation of TAV Georgia Tbilisi International Airport has turned into one of the most important hub in the Eastern Europe in a very short time” - Stated General Manager of TAV Georgia - Mete Erkal. In the result of survey of air-travellers – International Airports of Budapest Ferenc Liszt, Borispol (Kiev), Tallinn, Riga, Bratislava, Belgrade, Tbilisi, Sofia, Varna and Burgas- have been named as the best 10 airports of Eastern Europe of 2014 year. The World Airport Awards are based on 12.85 million customer nominations across 110 nationalities of air travellers,

and included 410 airports worldwide. The survey evaluates customer satisfaction across 39 key performance indicators for airport service and product - from check-in, arrivals, transfers, shopping, security and immigration, through to departure at the gate. It is also noteworthy that Tbilisi International Airport in 2010 in Dubai won the award in a category

as “The Best Emerging Airport” among the airports of Post CIS countries, next year in 2011 as well in Dubai Tbilisi International Airport got award as “the Best Airport CIS”. In 2011 Tbilisi International Airport was named as the winner in the nomination of “Public Transportation and Service” on “Golden Brand 2011” awards. In 2013, Tbilisi International

Airport got the award for “excellence in Airport Marketing” on “the routes Airport marketing Awards”. Operated by TAV Airports, Istanbul Atatürk Airport is listed amongst the top 10 airports in the category of airports welcoming more than 50 million passengers per year at “Skytrax World Airport Awards”. “TAV Georgia ” is a daughter company of “TAV

Airports Holding”. It started its operation in Georgia in 2005 year and will continue its activity until 2027 year as per the agreement in effect. Having made the investment worth over 100 million USD in Georgia, new passenger terminals of Tbilisi and Batumi airport were commissioned in 2007 year. The design of Tbilisi International Airport provided for construc-

tion of a new terminal, car park, improvements to the apron, taxiway and runway and acquisition of ground handling equipment. As for Batumi International Airport – it was entirely designed and constructed by TAV Georgia LLC. Thanks to multimillion investment made in many different countries, long term experience in airport operations and efficient management TAV Georgia has become one of the most reliable, stable and dynamic company in Georgia. Thus, modern infrastructure of Tbilisi and Batumi International Airports and high quality service allows best possible conditions for passengers so that to feel themselves safe and what is most important enjoy maximum comfort. Nowadays TAV Holding and its Partner “Aeroports de Paris Group” operate 38 Airports and provide handling over 200 million worldwide, including without limitation: [Istanbul Ataturk airport, Paris Charles de Gaulle airport, Ankara, Zagreb, Skopje, Riga, Medina airports, etc.]. Both companies are publicly traded companies and their shares are on a free float at the Paris and Istanbul Stock Exchange.

Banks’ Credit Portfolio in Georgia Will Exceed GEL 12 Billion in 2014, Zurab Gvasalia cial sector is one of the priorities of the strategic plan 2020, which has been designed by the Government. Accordingly, increased access to financial resources is a priority as well, which will then contribute to business development. So the banking sector will become more active and the credit portfolio will exceed at least GEL 12 billion. Lowering interest rates will also add to the further growth of credit investments. VTB Bank has already issued loans at an interest rate of 7 percent,” said Gvasalia.

The FINANCIAL By MARIAM PAPIDZE

he Georgian banking sector will become more active within the framework of economic recovery and the credit portfolio will exceed at least GEL 12 billion, believes Zurab Gvasalia, President of the Association of Banks of Georgia. Georgian banking sector has already recorded improved performance, as its profit in 2013 was the highest in recent years and about three times more than it was in 2012. Increased interest income and increased income from banking services are what drove the sector to such remarkable financial indicators, according to Gvasalia. “Georgian banks’ total revenues amounted to GEL 2,425 million in 2013, which is GEL 280 million more than in 2012. As for the net profit, it has grown from GEL 134 million to GEL 389 million. The volume of the banks’ capital increased significantly as well, from GEL 2,390 million to GEL 2,890 million. The credit portfolio of the banks in Georgia increased from GEL 8,733,255 to GEL 10,565,747. This means that, in the beginning of the year, it exceeded the limit of 9 bil-

ZURAB GVASALIA, President of the Association of Banks of Georgia

lion and at the end of the year reached an historic maximum and exceeded 10 billion,” Gvasalia told The FINANCIAL. “Interest income has increased from GEL 1,502 billion to GEL 1,640 billion, which means it increased by GEL 138 million in 2013 compared to 2012. As for non-interest incomes, their amount increased by GEL 123 million (from GEL 640 million to GEL 783 million). Despite the growth of

revenue, the amount of expenses remained at the same level as in 2012 which was what contributed to the high rate of profit. A very important fact is that the loss of assets in expenditure, including loans, is significantly reduced. It decreased by GEL 112 million (from GEL 325 million to GEL 213 million),” he continued. “The prognosis of economic growth is much better this year. Strengthening of the finan-

TRADE AND HOUSEHOLD ATTRACTING MOST FUNDING A. The highest amounts of loans issued in the first two months of 2014 were in trade (GEL 2,104 million) and household (GEL 2,113 million). Following those is consumer loans, which amounted to GEL 1,818 million. The volume of industry loans consisted of GEL 913 million and the volume of loans issued for the construction sector reached GEL 424 million. The structure of issued loans

shows that the Georgian economy is not oriented on the development of the real sector of the economy. The main weakness of the economic policy of previous years was exactly that - the underdevelopment of the real sector of the economy. That is why the economy was growing but was in fact not being reflected in the wellbeing of the average citizen. Workplaces were not created and accordingly, the economy was not creating additional value. The economic sector has not developed based only on the development of the commercial banks, which are established by private capital. This is because, in contrast to the trade sector, economic development requires much longerterm financing and risk insurance. Financing of agriculture is a good example of this opinion. Agriculture is considered to be one of the most high risk sectors. In recent years its financing was decreasing gradually and finally its share of the total credit portfolio consisted of just 0.7 percent in 2011. It was enough for the new government to start a cheap agrocredit programme, which provides risk insurance from the state’s side, that in 2013 alone, more than GEL 25 million was issued for the agro sector, which is more than 2 percent of the total credit portfolio.

This is a good example of how the commercial banks take the risks into consideration before issuing loans. If the risks are insured by the state it makes it easier for the banks to issue loans, especially for start-ups. Q. What legislative changes have affected the banking sector under the new government and which of them have had either a positive or negative impact? A. There were significant changes related to the temporary moratorium on the sale of land to foreigners. The restriction on purchasing agricultural land for commercial banks established by foreigners was removed. The success of the Georgian banking sector is driven by foreign investments and the banking sector in this direction is the leader of the country’s economy. The share of foreign capital out of the total banking capital is very solid and consists of 86 percent. Before, the problem was that the banks were not able to purchase the assets of real estate (in the form of agricultural lands), which were mortgaged in the bank on problematic loans, if a local buyer was not involved in its realization. This factor could become a serious reason for the outflow of forContinued on p. 23

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FINANCIAL HEADLINE NEWS & ANALYSIS

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FINCHANNEL.COM | 14 APRIL, 2014

MasterCard: Europeans Love Tapping for Everyday Spending The FINANCIAL

ver a one year period ending December 2013, it has grown its contactless footprint in Europe by expanding the number of countries where contactless cards are accepted: contactless is now available in 63 countries worldwide, and in 34 countries in Europe including 7 new countries in 2013: Azerbaijan, Finland, Ireland, Macedonia, Moldova, Montenegro and the Netherlands. MasterCard and Maestro contactless cards or devices have been issued by more than 220 financial institutions in Europe and can be used at almost 2 million merchant locations worldwide, representing more than a 180% year-onyear increase, according to MasterCard Data Warehouse. On top of the steady increase of the number of places where MasterCard and Maestro contactless payments can be made, the number of contactless transactions across Europe have more than tripled and the volume

spent on those transactions has increased four times year-on-year. “I am delighted to see Europeans continue to embrace contactless as innovative way to pay, when at home and abroad. The figures we share today showcase how contactless payment has reached mass market adoption in several countries. As well as being loved by people

across Europe, retailers are also seeing the benefit with some seeing well over 50% of card transactions tapped, making the shopping experience safer and simpler for all of us. The move to contactless is also helping us continue to drive the use of mobile payments and by the end of Q4 2013, we had 50 mobile NFC programmes live in Europe –

showing just how important payment innovation is for all of us in Europe,” said Javier Perez, President, MasterCard Europe. In Poland and in Czech Republic approximately one in three MasterCard and Maestro in-store card transaction is contactless, driven by the mass rollout of contactless cards and terminals as well as strong marketing campaigns, according to MasterCard Data Warehouse. In Hungary, a Bell Research study in 2013 about the MasterCard Mobile NFC Wallet pilot confirms that mobile NFC was extensively used for payments as well as for collecting reward points. Nearly 20% of respondents used their mobile NFC wallet at least daily and most of them have also collected reward points successfully associated with the value proposition. In Spain, MasterCard and Banco Sabadell announced a pilot of HCE (Host Card Emulation) that enabled contactless payments with a mobile phone without the use of a secure element, according to MasterCard Data Warehouse.

In Germany, MasterCard announced a collaboration between Deutsche Telekom, Telefónica Deutschland, Vodafone and TREVICA (a MasterCard owned company) to create a new mobile platform and accelerate the development of mobile payments in Germany. In the UK, MasterCard has joined forces with Weve, the joint venture between the three largest mobile operators: EE, O2 and Vodafone. This partnership will leverage Weve’s expertise in the mobile space along with MasterCard ’s innovative approach to payments and relationships with UK bank partners, bringing contactless mobile payments to 80% of UK consumers. In addition, EE has launched its mobile NFC service in the UK market, according to MasterCard Data Warehouse. In Switzerland, the largest retailers in the country are in the process of enabling contactless payments at thousands of merchant locations. With contactless also being adopted across parking, fast-food and transport, these latest developments are

underpinning the growth of contactless in the country. In Russia, commuters can travel faster and hasslefree as a pilot of MasterCard contactless was launched at MOSCOW Metro ticket machines. MasterCard , along with the Department of Transportation and Development of Road Transport Infrastructure of MOSCOW , MOSCOW Metro and Sberbank made contactless technology available to commuters at ten MOSCOW Metro stations, 64 ticket machines, according to MasterCard Data Warehouse. In The Netherlands, following a successful mobile NFC pilot in the city of Leiden in 2013, ING Bank recently announced that from 15 April 2014 onwards all ING cardholders will have contactless payments on their Maestro cards. In Austria, most banks have started to enable the contactless function on their Maestro debit card portfolios upon renewal of these cards equipping most cardholders in the country with tap & go, according to MasterCard Data Warehouse.

Life after Misha?

Five countries attitudes Georgia’s future without Saakashvili MERAB PACHULIA GORBI

Chart1: Attitudes towards Saakashvili’s departure from the Georgian presidency

Dear reader,

fter two years, long time columnist Frank Klobucar is leaving Georgia and he will no longer be contributing to this premier newspaper. I want to use this opportunity to thank him for his hard work in bringing readers up to date through numbers and offering his unique perspectives on Georgia. Of course I am also grateful for the continued professional collaboration with The FINANCIAL. From now on I will be sharing exclusive survey data with you. My aim is to uncover public opinions and attitudes of the Georgian population, describe how other countries are thinking about Georgia, and to present trend data. Having personally started the opinion research industry in Georgia in 1990, together with a brilliant staff ,I have been fortunate enough to be able to collect data consistently since, and this includes the many difficult times when Georgia was experiencing war and revolution. Our surveys have reflected dramatic changes in Georgian society over the years. Just to demonstrate these swings, in an early nationwide survey conducted in 1990, environmental problems were considered as the country’s top problem. Unemployment was not on the list. For those who are lucky and did not grow up in the Soviet period, unemployment didn’t exist, and failing to show up to work was punishable by the law. Naturally it didn’t take long for unemployment to become an issue commanding the Georgian public’s attention, as with most of world.

Source: January 2014, GORBI 5 country public opinion survey.

By the late 1990s, as is the case today, joblessness was the number 1 problem according to every single opinion poll conducted in Georgia. Today, very few if any, worry about environmental problems, even as global warming increases and the Georgian authorities move ahead with plans to construct hydropower dams and new sea ports, etc. Truth to be told, GORBI was the very first organization that introduced paper less, the most environmentally friendly data collection practices in Georgia (using computer assisted data collection techniques) but this is rarely appreciated even by some western agencies operating in Georgia, nothing to say about how the local business community invests money for surveys. Economic related issues continue to fall within the top 10 issues that survey respondents name as problematic. Corruption, truly the oldest

profession in history, has for years led among the top concerns of the population. However, this became comparatively irrelevant, perhaps after being reigned in after drastic reforms launched in 2006. Of course this is not concerning “elite corruption” or the kind found in the private sector and big business dealings. Rather I am referring to the “petty” corruption that a citizen might face on the streets during run in with shady cops or in bureaucratic/state functions. This is the kind that can be measured by public opinion surveys. Perhaps the most interesting survey outcome of our survey work is in the area of elections. Aside from the 2013 presidential elections, since 1992 when democratically-elected president Gamsakhurdia was ousted in a coup, none of our post-election survey data has matched the official election results! (The 2003 “revolu-

tion” could hardly be considered a true power change: autocrat Shevardnadze failed and was replaced by a new autocrat who was his early protégé). This was also the case for the 2012 parliamentary elections, the first peaceful transfer of power in the country even if the pre-election period and the actual Election Day itself lagged behind Western standards. Recently, the Georgian Prosecutor’s Office summoned ex-president Mikhail (Misha) Saakashvili for questioning in connection to multiple crimes. While we wait to hear the verdict from authorities (and it does seem things have cooled somewhat after Misha simply refused to come home), let’s take a look at what the public thinks about Saakashvili’s legacy. GORBI asked nationally representative samples in Armenia, Azerbaijan, Belarus, Georgia and Ukraine about their feelings towards Saakashvili’ departure from office. It is important to understand here that during his two terms in office, Saakashvili was on the radar of many men and women. The Georgian “success story” which Misha is oft credited was carefully crafted, packaged and successfully sold in several countries, especially in the region. He was and still is perceived as a successful reformer in the eyes of many individuals across these countries. Seen as an Alfa male just less than two years ago, Misha now he has lost most of his supporters and only a shadow remains of his once skyrocketing trust rating. However, he still enjoys more support compared to his predecessor, Edward Shevardnadze, whose trust rating before and after his resignation in 2003 is measured in the single digits. Based on a January 2014 survey conducted by GORBI, Shevardnadze’s trust rating was 6%.

Overall, in all five surveyed countries, people think that Misha’s departure from office will be more than less good for Georgia’s future. However, in surveyed countries outside of Georgia, majority of respondents has either no idea of the possible effect or think that Saakashvili’s absence from the presidency will not make any difference. Interestingly though, across all countries and among various cohorts of society, older respondents and males tend to be more favorable of Misha’s departure compared to youngsters or females. The survey was conducted in all five countries before Russia “liberated” Crimea in March. Had Ukrainians been asked the same question today, we might have different results. One has to take into consideration Saakashvili’s heavy media exposure and presence in Ukraine and across Western capitals and universities, where he has been a loud antiRussian “cheerleader” throughout the on-going crisis. As a regional hub for partner organizations and international clients, since 2003, GORBI is the only Georgian member of the Gallup International research network to have over two decades of experience in survey research in post-Soviet Union countries, as well as Mongolia and Iraq. All 5 surveys were conducted on a national representative sample of 1,000 respondents aged 15 or older in January 2014; data retains a 3% margin of error, with confidence at 95%. This data was provided exclusively to the Financial. Please do not visit our site (www.gorbi.com); it is under construction!

CMYK

HEADLINE NEWS & ANALYSIS

Best Georgian Banks GENERAL INFORMATION UPDATE: The Bank is a universal bank with traditionally strong presence in the corporate segment and key strengths in the retail and SME segments. TBC Bank has maintained the leading position in retail deposits (33.1% market share as at YE 2013) for seven consecutive years. The Bank consistently achieves the second largest market share in all other key segments with 27.7%, 28.2%, and 28.0% in retail loans, corporate loans and total loans respectively. Four prominent IFIs, EBRD, IFC, DEG and FMO together with JP Morgan and Ashmore hold 65% of TBC Bank shares. TBC Bank has a leading, award-winning internet, mobile and other electronic distribution channels. In 2013, the Bank received the first global recognition from Global Finance Magazine for its achievements in internet banking – the first such award for any Georgian bank. TBC Bank has continued its strong track-record of profitability and growth during 2013. The Bank built on its strong brand, superior customer service and award-winning franchise to maintain a substantial gap in customer experience versus the next best competitor*.

KEY FACTS (AS OF DECEMBER 31, 2012 INCLUDING BANK CONSTANTA) C. 1 million customers in key segments (Retail, corporate, SME and Micro) Loan book composition: Corporate (39%), Retail (41%), SME (13%), Micro (7%) Number of employees: c. 4000 Number of Accounts: 1,150,782 (SME: 64,885; Retail: 920,133; Corporate: 4,008; Micro: 161,756)

SHAREHOLDING STRUCTURE, 31 DECEMBER 2013

14 APRIL, 2014 | FINCHANNEL.COM

TBC Bank

Vano Baliashvili Deputy CEO, Chief Operating Officer Archil Mamatelashvili Deputy CEO, Chief Risk Officer Mariam Meghvinetukhutsesi Deputy CEO, Corporate Banking Nino Masurashvili Deputy CEO, Retail & SME Banking

FINANCIAL HIGHLIGHTS: Audited IFRS consolidated figures In 2013 TBC Bank has continued its path to sustainable growth with a clear strategic focus on core banking. As the Georgian banking success story, TBC Bank has again delivered impressive results against our prudent strategic goals and achieved significant milestones in developing the Bank’s financial strength, capabilities and brand value.

GEL million

USD million

Growth Rate

Total Assets

4,451

2,564

14%

Gross Loans

2,959

1,704

17%

Customer Deposits

2,887

1,663

16%

Equity

729

420

21%

Net Profit

124

Int. rating & awards:

RATINGS: Fitch: BB- (Long Term IDR)/B (Short Term IDR) affirmed in June 2013 Moody’s: B1 (FC)/Ba3 (LC) affirmed in October 2013 Awards: Best Bank – Georgia 2014 by Global finance Best Foreign Exchange Provider in Georgia by Global finance Best Bill Payment & Presentment and Best Integrated internet banking site in the world by global finance

27%

2013

2012

ROAE

18.7%

18.6%

ROAA

3.1%

2.7%

Cost to Income

51.7%

56.3%

Cost of Risk

1.2%

1.0%

102.5%

102.0%

1.1%

1.0%

NPL + Restructured Loans Coverage Ratio

110.6%

145.1%

BIS Tier I CAR

21.6%

20.3%

NPL to Gross Loans

NEW SERVICES OR PRODUCTS OFFERED: TBC was the first bank to introduce mobile banking applications for iPhone/Android and smartphones (2012) and Blackberry and iPad (2013). We have three times more internet banking customers as the next best competitor and are leading in multichannel technology innovation. TBC Bank was also the first Georgian bank to receive awards on a regional and global scale. In 2013, Global Finance Magazine awarded our multichannel platform in the following categories: “Best Bill Payment and Presentments” Global award (2013) “Best Integrated Website” Global award (2013) “Best Bill Presentment & Payment in Central & Eastern Europe 2013” “Best Integrated Corporate Bank Site in Central & Eastern Europe 2013” Numerous “Best Internet Banking in Georgia” awards (2012, 2013)

BUSINESS SUPPORT PROGRAM – PROJECT OFFERED FOR SMES Business Support Program ”7 steps to success” offers unprecedented educational and business development services to its SME clients free of charge. Figure 6 TBC Bank Business Support Program – 7 Steps to Success

Best bank in Georgia 2013 by EMeafinance Corporate Responsibility Award in Central and Eastern Europe & CIS by EMeafinance

Number of branches: 114 branches, 332 ATMs, 2,779 POS’s across Georgia;

CHANGES IN MANAGEMENT: Vakhtang Butskhrikidze CEO Paata Ghadzadze First Deputy CEO

NEW OFFERINGS Our products and offerings are targeted to all of our retail, corporate, SME and micro customers and we align the product development to their changing needs. 2013 was another successful year in terms of new offerings, examples of which are listed below:

NEW LOAN PRODUCTS

Financial Highlights as at YE 2013

Loans/Deposits

Mission - We create new opportunities for the success of people and businesses. Vision - Through the best employees, strong brand and superior customer experience provided via innovative multichannel facilities we plan to: Have the largest franchise of medium and high income retail and SME business segments; Be the core bank for large corporate businesses; Be the leader in Non-Resident deposits ‘segment; `Be the bank of regional importance.

Social Media Marketing, HR, Strategic Management) Upgraded Internet Bank for legal entities Completely new Mobile Bank for legal entities Exclusive and best-in-class Educational web portal www. tbcbusiness.ge (financed by IFC and in partnership with IBM). Here, businesses can find a wealth of educational materials and resources, as well as tailored support from our partners from leading legal and audit companies. Readily available resources include tools for financial accounting, direct selling, and human resource management. The portal also offers pre-set materials, such as agreement forms, template accounting forms, and Q&A blog. In 2014, TBC Business Support Program intends to launch the following additional services: SMS banking services for legal entities Free business consultation services for SMEs Business conferences for SMEs

Giorgi Shagidze Deputy CEO, Chief Financial Officer

Key Ratios1

FINANCIAL

SERVICES CURRENTLY AVAILABLE TO OUR CUSTOMERS INCLUDE: Free trainings financed by ADB (Budgeting, CVP Analyze,

TBC Bank started offering innovative loan products that better respond to the maturing interests and requirements of Georgian customers. Mortgage loan in GEL - In 2013, TBC Bank started offering the lowest-rate mortgage loans in GEL with a floating rate – determined with a combination of the Bank’s fixed rate and the National Bank of Georgia floating refinancing rate. CEEP on White Goods in installments - TBC Bank is a leader in renewable energy financing. TBC is the first (since 2007) and the most active participants in the EBRD Caucasus Energy Efficiency Program, where the Bank received another USD 10 million financing in 2012/2013. The line offers free energy audit and 10-15% cash back to TBC Bank clients. The novelty of the offering was that the line was launched in the retail segment with the product and vendor list eligible for financing expanded significantly.

COUNTRY-FIRST IPAD BANKING TBC Bank was the first Georgian Bank to launch the countryfirst iPad application. The application is unique as it is fully integrated with the Apple iOS functionality and provides full internet banking features, such as Personal Finance Management “My Money”.

PUBLIC CAMPAIGNS AND CHARITY: TBC is one of the most well-known and trusted brands in Georgia driven by, amongst other factors, its high level of customer service, strong reputation, longstanding relationships with customers, focus on social responsibility and targeted marketing campaigns. In order for TBC to continue to develop this advantage, we have introduced several new marketing campaigns and initiatives that enhance our brand platform and allow for a more direct communication with our customers. These campaigns included market first in Georgia “Sensory Marketing” project. Sensory Marketing Project launched in Q1 2014 to establish a unique branded customer experience in 10 branches. The two elements of the campaign are: Sound – Generative Soundscape in the branches inspired by Georgian musical traditions creating a relaxing atmosphere; and Scent – Deployed a signature BrandScent, TBC Platinum, designed to stimulate the senses, stir emotions and help neutralize the stresses of the outside world

CORPORATE SOCIAL RESPONSIBILITY TBC Bank brand is greatly complemented by the Bank’s CSR track record. We have one of the best-developed Corporate Social Responsibility strategies among Georgian corporations. TBC Bank 2013 CSR projects were concentrated on developing the following key areas: arts, culture and music, sports and tourism, support for social causes. TBC Bank continued to develop its online art-television Artarea throughout 2013. The television channel that allows Georgian viewers to keep up to date with current events in culture, music and arts is now available via cable TV in the entire country. Along with Artarea the bank continues its support to the development of modern literature with organizing the most powerful literary competition SABA. The award program is one of the most respected and anticipated literary events in the country. TBC Bank founded the program in 2003 with 2013 marking the 11th anniversary ceremony. To this date, the Bank has recognized over 100 authors and awarded c. GEL 325,000 in prizes. In 2012, the SABA brand was extended to the marketfirst online bookstore that offers downloadable versions of the SABA-winning works, classic series both from Georgian and international authors, books on business and management, children’s titles and etc. In 2013, we launched the first Georgian-based e-book application “Saba Offline Reader” that is compatible with the Windows and Mac operating systems. The book store can be found at www.saba. com.ge.

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 14 APRIL, 2014

Best Georgian Banks

Advertiser: Grant Thornton. Contact FINANCIAL Ad Dep at marketing@finchannel.com

CMYK

HEADLINE NEWS & ANALYSIS

Best Georgian Banks

FINANCIAL

14 APRIL, 2014 | FINCHANNEL.COM

LIBERTY BANK

Name of the bank: Liberty Bank Shareholders: Liberty Holding Georgia, Liberty Capital, Foreign Institutional Shareholders, Employees, Individuals Int. rating & awards: FitchRatings: ‘B’, Stable Outlook Number of branches: 603 Customer groups: individuals and legal entities New branches in 2013: 28 Since 2009 Liberty Bank has put a strong emphasis on giving back to the community. Some examples off the top of the head are: sponsorship of the national teams in rugby and basketball; football teams “Kolkheti”, “Baia”, “Olimpi”; organizing events supporting start-ups in Georgia - the “Digital Summer” and “Start-up Weekend”; and just recently bank has offered a sponsorship package to Georgian swimmer Irakli Bolkvadze who is likely to compete at the world championship. Liberty Bank is one of few companies in Georgia offering paid internships to up to 30 talented students every year. However bank does not limit itself to financial support, management stress the importance of communication with the younger generation, and thus the management board tries to accept every pro bono speaker invitation from a variety of educational and professional institutions. In 2014, bank plans to further expand its efforts by offering novelties in social crowd funding and contributing even more to the education and development of the country’s youth. Total Assets Net Loans Client Balances & Deposits Total Liabilities Shareholders’ Equity Net Interest Income Revenue Pre-Tax Income Net Income Current Account Balances Savings Accounts Time Deposits & CDs Mortgage Loans

31-Dec-13 1,295,106,333 583,635,405 1,138,541,175 1,180,563,170 114,543,163

31-Dec-12 838,931,503 374,002,790 689,976,801 740,270,294 98,661,209

2013 60,621,799 90,113,300 14,533,431 17,418,075

2012 54,574,341 91,875,140 9,785,200 5,185,285

31-Dec-13 694,825,161 49,614,282 392,896,712

31-Dec-12 441,276,420 10,595,840 238,104,540

31-Dec-13 11,421,970

31-Dec-12 12,794,887

Consumer Loans Credit Cards Other

24,212,130 17,512,005 599,435,458

12,038,554 6,759,313 374,485,815

The Bank’s core business includes a broad range of retail and corporate banking products and services, as well as private banking products and services. In general, the Bank accepts deposits from the public (retail and corporate) and extends loans to businesses and retail clients. The Bank offers a range of retail banking products and services, including current accounts in local and foreign currencies, savings accounts, term deposits in local and foreign currencies, general purpose consumer loans, student loans, payroll loans and overdrafts, pension advances, depositbacked loans, auto loans, instalment loans, micro-financing loans, mortgage loans and credit cards. The Bank offers its retail clients domestic and international remittance and P2P money transfer services through its branches, ATMs and other electronic channels, including in case of P2P money transfers, SMS messages and Facebook. The Bank offers its retail clients access to their current accounts via debit cards, Internet banking, mobile phone banking and ATM services. The Bank also offers its retail clients payment services in respect of certain utility, mobile phone and other customer bills at its branches. The Bank has the largest number of branches in Georgia, comprising, as at 31 December 2013, 603 branches and service outlets in Georgia, including full-service flagship branches, service centres and smaller scale outlets, as well as 105 mobile Liberty Express branches. Other distribution channels include, as at 31 December 2013, 342 ATMs and 1,494 POS terminals, as well as Internet and mobile phone banking operations and the Bank’s call centre, which manages inbound and outbound calls. The Bank offers remittances via 22 money transfer service providers, including Western Union, MoneyGram, Zolotaya Korona, Unistream, Anelik, Contact, Bistraya Pochta, Leader, Migom, EuroGiro and Coinstar. The Bank offers the highest number of money transfer systems of any bank in Georgia. The Bank also operates its own domestic money transfer service, Liberty Express. Interest rates on GEL term deposits range between 7.5% to 12.5% p.a.

DEPOSITS AND PAYMENT: The Bank offers a range of saving accounts and term deposits to its clients, including the following: Patriot. Introduced in November 2010, the Patriot savings

account is a savings account denominated in Lari. Patriot offers competitive interest rates and the opportunity to withdraw interest or funds whenever needed. As at 31 December 2013, Patriot’s annual interest rate was set at 11.0%. Funds can be deposited in a Patriot savings account at any time. M7 Deposit. Introduced in January 2010, the M7 deposit is a market-tracking term deposit, where the interest rate on the deposit is determined monthly by the annual interest rates of seven leading banks in Georgia, not including Liberty Bank, with the interest rate equalling the highest interest rate of these seven banks, plus an additional 0.1% in Lari and 0.1% in U.S. Dollars and Euros. The new annual interest rate is applied from the beginning of each month. The interest rates on a deposit cannot decrease after a deposit has been made. The Bank also offers its clients conventional term deposits and other term deposit products with various additional features, for instance, flexible withdrawal, the interest paid upfront, child savings deposit and others.

LOANS: The Bank offers mortgage loans with a maturity of up to 30 years for the purchase or renovation of real estate. Such loans are secured by a pledge of the real estate being purchased or a pledge of alternative property or other collateral. General consumer loans are offered as fixed-term, fixed-instalment loans to be used for general purposes. The Bank began offering credit cards to a wider group of customers, and to the general public, in the first half of 2010. The Bank’s credit card is called Magic Card. Magic Card is a GELdenominated revolving VISA credit card with extra features, such as a 55 day grace period feature and a money reimbursement feature following every 1000th transaction conducted among all outstanding Magic Cards.

BANKING: On-line banking, money market & derivatives, cash collection, internet banking, direct debit, foreign exchange. The Bank offers access to its retail banking products and services through the Internet, allowing customers to make interbank payments to companies or individuals, monitor account balances, transfer funds (within the Bank and to third party accounts), order plastic banking cards and open accounts. The Bank also offers an SMS-based mobile banking service, allowing automatic delivery of transactional information to customers’ mobile phones.

JSC “PROCREDIT BANK” Name of the bank: ProCredit Bank Shareholders: ProCredit Holding AG & Co. KGaA – 100% Mission & vision: In our operations with business clients, we focus on very small, small and medium-sized enterprises, as we are convinced that these businesses create jobs and make a vital contribution to the economies in which they operate. By offering simple and accessible deposit facilities and other banking services and by investing substantial resources in financial education we aim to promote a culture of savings and responsibility which can help to bring greater stability and security to ordinary households. Our shareholders expect a sustainable return on investment over the long term, rather than being focused on short-term profit maximisation. We invest extensively in the training and development of our staff in order to create an open and efficient working atmosphere, and to provide friendly and competent service for our customers.

INT. RATING & AWARDS: On June 14, 2013 the international rating agency Fitch Ratings affirmed the Long-term Issuer Default Rating (IDR) and Viability Rating (VR) of ProCredit Bank Georgia one notch above the sovereign rating (BB-/Stable). Long-term foreign and local currency IDRs: affirmed at ‘BB’; Outlook Stable Short-term foreign and local currency IDRs: affirmed at ‘B’ Viability Rating: affirmed at ‘BB-’ Support Rating: affirmed at ‘3’ Number of branches: 51 Customer groups: Very Small, Small and Medium-sized business clients

LATEST DEVELOPMENTS: Changes in shareholders: None Changes in management: Asmus Rotne was appointed as General Director of ProCredit Bank Georgia, replacing Dr h.c. Sascha Ternes, who resigned in March 2014. Dr Ternes had served as General Director of the bank since 2012 and was a member of its Management Board since 2007. Asmus Rotne’s career with the ProCredit group started in 2002 at ProCredit Bank Georgia, where he was Deputy General Director. He later held the same position at ProCredit Bank Romania and then went on to become Chairman of the Management Board of ProCredit Bank Moldova, prior to joining ProCredit Bank Armenia as General Director in 2011. Mr Rotne received a bachelor’s degree in political science from Aarhus University, Denmark in 2000 and a master’s degree in regional studies (Russia, Eastern Europe and Central Asia) from Harvard University in 2002. Received awards and participation: On 7 March 2014 ProCredit Bank received an award for gender balance at the executive level. The contest was organised by the United Nations Development Programme (UNDP) in Georgia with the support

of the Swedish government. New branches: ProCredit Bank continues the renovation process of its branches. The Bank has relocated the Eliava Service Point, Tsereteli Service Centre and Station Branch, the latest updates were made at Kobuleti and Batumi Chavchavadze Service Points. New services or products offered: ProCredit Bank has launched an electronic signature system for the first time in the banking sector of Georgia. Besides the bank offered a credit card for its clients both business clients and private individuals. Public campaigns and charity: On Februaty 12, 2014 as part of an event organised by the Blood Transfusion Station ProCredit Bank employees donated blood at the bank”s head office to help people in need. On December 17, 2013 the outstanding ex-libris collection was donated to the National Centre of Manuscripts at a ceremony held at ProCredit Bank’s head office. From November 12 until December 6 the unique German exhibition “Hands-on Mathematics” is coming to Georgia for the first time, hosted by ProCredit Bank in its new head office in Tbilisi. Visitors from 8 years of age and up are invited to experience this playful and entertaining look at mathematics. During 6 weeks the exhibition was visited by more than 8 000 visitors.

FINANCIAL HIGHLIGHTS: Number of clients

Individual

149 266

Number of clients

Juridical

10 201

Total Number of Clients

159 467.00

Consolidated Statement of Financial Position – Unaudited Figures in ‘000 GEL Notes Assets Cash and cash equivalents

Financial assets at fair value through profit or loss Investment securities available-for-sale

31 December 2013

31 December 2012

198,711

183,412

234

Due from banks

44,988

59,115

Loans and advances to customers

692,888

711,667

1,743

Current tax asset

Due to banks

8,290

Customer accounts

569,166

535,776

Other borrowed funds

256,709

295,466

Subordinated debt

66,308

63,135

929

Current tax liability Other liabilities

2,031

1,590

Other provisions

731

1,030

Deferred tax liability

2,445

1,243

897,413

907,459

Total liabilities Equity Share capital

83,000

80,000

Share premium

30,803

28,286

Retained earnings

31,579

37,025

Total equity

145,382

145,311

Total equity and liabilities

1,042,795

1,052,770

Consolidated Statement of Profit or Loss and Other Comprehensive Income - Unaudited Figures in ‘000 GEL Interest income Interest expense Net interest income Provision for loan impairment Net interest income after provision for loan impairment Fee and commission income Fee and commission expenses Net gain from trading in foreign currency Net foreign exchange translation losses Personnel expenses Other administrative expenses Other operating income

Notes 22 22

2013 114,197 (44,305) 69,892

2012 125,326 (49,719) 75,607

(6,057)

(6,102)

63,835

69,505

11,850

11,949

(4,308)

(4,159)

7,655

6,730

(1,510)

(405)

(28,412)

(32,432)

(27,188)

(26,216)

1,243

1,247

Other operating expenses

(354)

(1,066)

Profit before income tax

22,811

25,153

Income tax expense Profit and total comprehensive income for the year

(3,257)

(3,584)

19,554

21,569

Investment properties

1,264

845

Intangible assets

2,868

3,491

Property and equipment

84,681

79,116

Other assets

15,404

14,858

1,042,795

1,052,770

Total assets

Liabilities

Continued on p. 17

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS

Best Georgian Banks

FINCHANNEL.COM | 14 APRIL, 2014

KOR STANDARD BANK Kor Standard Bank Name of the bank: Shareholders: H. H. Sheikh Nahayan Mabarak Al Nahayan – 45% H. H. Sheikh Hamed Bin Zayed Al Nahayan – 20% H. H. Sheikh Mansur Bin Zayed Bin Sultan Al Nahayan – 15% H. H. Sheikh Mohamed Buti Al Hamed – 15% LTD. Investment Trading Group – 5%

Annual interest rates

0.5%

KSB Within deposited amount

In any other bank

1.5% min USD 3

EUR 2.00%

INTEREST ON TOP-UP WITHDRAWN AMOUNT

GEL

USD

EUR

6.00%%

3.00%

2.00%

Settlement fees

VISA Royal card Issuance and service tariffs

None authorized overdraft (per day)

0.5%

* Partner bank of KSB Bank: Liberty Bank

Card type

Visa Classic

Card validity

2 years

Card currency

GEL/USD/EUR

Principal / supplementary card issuing

Free of charge/20 GEL

Reissuing of card (due to damage of card)

GEL 30

Urgent Card Issuing Card placement in Local stop-list International

Card issuing + 20 GEL

Free

USD 40

Statement from the Bank Appeal on the transactions made by card Commission for service of the returned funds of the operation performed abroad through terminals or transferred from the internet sites

Free

USD 15

KSB Bank’s VISA plastic cardholders can transfer money to any KSB Bank’s VISA plastic card via ATM Transfer of funds from card to card (through ATM) Commission fee for transfer of funds through ATM

Currency

GEL, USD, EUR

Transfer fee

0.1% min. GEL 0.5

Single limit for transfer

Daily limit for transfer

Encashment limits via Visa Royal per day From ATMs

GEL 5,000

In KSB Bank

Unlimited

In other bank

GEL 10,000

Settlement via (POS) terminal

GEL 10,000

Transactions limit

30 transactions

Cash withdrawal fee from ATM 0% 0.7% min. GEL 0.2

ATM of any other bank

2% min. USD 2

GEL 10,000

ROYAL CARD OPERATIONS:

Partner Banks’ ATM*

GEL 5,000

For more comfort KSB Bank offers you simple way to deposit money on the current or plastic card account. Visit the nearest quick payment machine and through the simple procedure deposit money on your or your friends’ accounts.

Commission for settlement and encashment via Visa Royal

KSB Bank’s ATM

Transfer limits

Withdraw money from the deposit from any ATM in the world Utility payments Online payments Purchase goods and services at merchants Transfer money to other VISA plastic card via ATM ROYAL deposit holders are entiteled to simplified credit Consumer loans loans: annual rate - 1% Auto loans: annual rate - 0.5% Mortgage loans: annual rate - 0.25%

Cash withdrawal fee from the bank

Settlement via (POS) terminal

INTEREST ON FIXED AMOUNT

0.2%

KSB Bank - Foreign Currency

USD 3.00%

MISSION & VISION: The objective of KSB Bank, as the member of the international investment group, is to become the financial institution of the international level through team efforts and goal-directed activities. KSB Bank is one of the first investments of the largest company “Dhabi Group” in Georgia. 45% shareholder of the company is His Excellency, Sheikh Nahayan Mabarak Al Nahayan, State Minister of Education and Scientific Research of the United Arab Emirates. The bank provides the services to the corporate, as well as the retail customers. KSB Bank operates throughout Georgia through 19 branches offering the banking service and wide spectrum of the products to its customers. Partners to the KSB Bank are the largest Georgian companies, such as: the Revenues Service, Prosecutor’s Office, Telasi, National Bureau of Enforcement, National Bank of Georgia, Georgian Railway, Tbilisi Opera and Ballet Theatre of Zakarya Paliashvili, Bravo Records and many other companies cooperating with and recommending KSB Bank as the alternative and the bank providing high level services. KSB Bank cares about strengthening the values of the national culture making its contribution to cultural development of the country. Number of branches: 19 Royal Deposit is a form of saving deposit, which enables you use deposit amount with the plastic card on your decision. Advantages of Royal Deposit Unlimited top-up and withdrawal Fixed high interest rate Accessible money for 24/7 Cash withdrawal from KSB Bank’s ATM free of charge Conditions of the deposit: Deposit opening - free Deposit service fee – 5 GEL per month Deposit term - unlimited Minimum amount to open a deposit – 50 units Top-up/withdrawal – unlimited Interest accrued on deposit – at the end of each month

KSB Bank - GEL

GEL 6.00%

JSC “BANK CONSTANTA”

SHAREHOLDERS

Bank: JSC "Bank Constanta" Date: 31-Dec-13 Balance Sheet

Bank Constanta is originated from the NGO “Constanta Foundation” which was established in 1997 by the small group of individuals with the headship of Mrs Tamar Lebanidze. In December, 2007 Constanta started its operations as Joint Stock Company (JSC); following this important change, on July 3, 2008 Constanta received the banking license from the National Bank of Georgia (NBG) and started to conduct commercial banking operations under the brand new name JSC Bank Constanta. At that time, 67.8% of banking shares was hold by «Constanta +», and 32.2% - by the private shareholders. In July 2010, Oikocredit, Ecumenical Development Co-operative Society U.A., came in as the first foreign shareholder of the Bank. In May 2011, another important investment was made into Bank Constanta’s share capital - TBC Bank purchased «Constanta +» equity and acquired total 80% of bank›s share capital. Oikocredit maintained its 13% stake in the bank and the private shareholders retained 7% banking shares.

SHAREHOLDER STRUCTURE: 84.68% - JSC TBC Bank 10.96% - Oikocredit, Ecumenical Development Co-operative Society U.A 4.36% - Individual Shareholders

N 1 2 3 4 5 6.1 6.2 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

ASSETS Cash Due from NBG Due from Banks Dealing Securities Investment Securities Loans Less: Loan Loss Reserves Net Loans Accrued Interest and Dividends Receivable Other Real Estate Owned & Repossessed Assets Equity Investments Fixed Assets and Intangible Assets Other Assets TOTAL ASSETS LIABILITIES Due to Banks Current (Accounts) Deposits Demand Deposits Time Deposits Own Debt Securities Borrowings Accrued Interest and Dividends Payable Other Liabilities Subordinated Debentures Total Liabilities EQUITY CAPITAL Common Stock Preferred Stock Less: Repurchased Shares Share Premium General Reserves Retained Earnings Asset Revaluation Reserves Total Equty Capital TOTAL LIABILITIES AND EQUITY CAPITAL

sheet N1 in lari

Total 13,522,132 17,746,014 6,615,409 0 0 284,922,409 -10,650,021 274,272,388 6,046,900 1,546,539 114,000 21,415,557 3,095,608 344,374,546

Respective period of the previous year GEL 4,349,578 3,219,801 4,723,683 0 0 71,324,823 -2,888,202 68,436,621 2,558,248 296,021 114,000 17,921,345 2,046,642 103,665,940

FX 3,709,993 9,728,493 11,245,382 0 0 122,942,523 -5,061,219 117,881,304 1,849,439 0 0 0 1,030,830 145,445,442

Total 8,059,572 12,948,294 15,969,065 0 0 194,267,346 -7,949,421 186,317,925 4,407,688 296,021 114,000 17,921,345 3,077,473 249,111,382

2,850,720 2,738,748 4,968,739 15,396,663 0 139,067,200 2,938,779 84,180 0 168,045,029

6,220,835 11,916,431 7,051,804 51,222,391 0 201,480,683 4,747,197 4,887,370 5,000,000 292,826,712

5,038,033 2,930,019 10,207,953 22,460,338 0 16,497,395 896,148 2,756,005 5,000,000 65,785,891

0 1,904,029 2,428,324 15,477,249 0 127,035,170 2,751,861 51,724 0 149,648,357

5,038,033 4,834,048 12,636,277 37,937,587 0 143,532,565 3,648,010 2,807,729 5,000,000 215,434,248

X X X X X X X X 168,045,029

30,739,495 3,000,000 0 1,790,174 0 15,368,539 649,625 51,547,834 344,374,546

27,422,564 0 0 983,287 0 4,621,657 649,625 33,677,134 99,463,025

X X X X X X X X 149,648,357

27,422,564 0 0 983,287 0 4,621,657 649,625 33,677,134 249,111,382

Reporting Period GEL 7,132,773 4,584,806 3,898,976 0 0 140,892,889 -4,410,957 136,481,932 4,064,702 1,546,539 114,000 21,415,557 2,016,650 181,255,935

FX 6,389,359 13,161,209 2,716,433 0 0 144,029,520 -6,239,065 137,790,456 1,982,197 0 0 0 1,078,958 163,118,611

3,370,115 9,177,683 2,083,066 35,825,729 0 62,413,483 1,808,418 5,103,189 5,000,000 124,781,683 30,739,495 3,000,000 0 1,790,174 0 15,368,539 649,625 51,547,834 176,329,517

JSC “PROCREDIT BANK” Continued from p. 16

PRODUCTS, SERVICES AND RATES ProCredit Bank’s lending policy is rooted in the principles of responsible lending. In its lending activity the bank focuses on small and medium sized enterprises as they are seen as the engine for economic growth and development of the country. The services of the bank are designed to make them easily understandable and reliable for you, as they are transparent and clearly explained to you. The bank is not interested in short-term

financial gains, but aims o build a long-term relationship with you, which is based on mutual trust and genuine partnership. ProCredit Bank offers a variety of banking services tailored to the needs of business clients and private individuals: agro, business and consumer loans, deposits, debit and credit plastic cards, Internet banking, SMS Service, money transfers, salary projects, etc.

Documentary Operations.

LOANS:

DEPOSITS AND PAYMENT:

Mortgage Loans, Eco Loans, Home Improvement Loans, Consumer Loans, Credit Cards for business and private individuals, Floating Loans, Agro Loans, Credit Lines, Short-term Business Loans, Business Overdrafts, Credit Limits, Eco Loans for businesses.

Term Deposit, Flexible Deposit, Savings Plan, Savings Account – all both for business and private clients and Child Deposit for private individuals. Money Transfers, Salary Overdraft, Utility Payment,

Internet Banking, Mobile Banking (PDA version), Standing Order, SMS Service, Telephone Banking, Pay Box

BANKING:

CMYK

Best Georgian Banks

HEADLINE NEWS & ANALYSIS

FINANCIAL

14 APRIL, 2014 | FINCHANNEL.COM

Advertiser: KSB Bank. Contact FINANCIAL Ad Dep at marketing@finchannel.com

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS

georgian banking services

FINCHANNEL.COM | 14 APRIL, 2014 TBC BANK TBILISI BRANCHES Tbilisi #9 Service Center in Zahesi (Customs Terminal) 0125, 105 A, Mshvidoba St. Vake Branch #1 0179, 41, Abashidze St. Central Branch 0179, 11, Chavchavadze Ave. Chavchavadze Branch #1 0179, 29/31/33, Chavchavazde Ave Vera Branch 0179, 31, Melikishvili St. Parliament Service Center 0118, 8, Rustaveli Ave Mtatsminda Branch 0105, 1, Rustaveli Ave. Rustaveli Service-Center 0108, Marriot hotel Rustaveli Branch #1 0108, 44, Rustaveli Ave. Mtatsminda Branch #2 0105, 22, Leselidze St. Rustaveli Branch #2 0105, 52, Rustaveli Ave. Avlabari Branch #1 0103, 2, Ketevan Tsamebuli Ave. Varketili Branch #1 Javakheti St. Isani Branch 0120, 67, K. Tsamebuli Ave. Vazha-Pshavela Branch #2 0186, 73, Vazha-Pshavela Ave. Vazha-Pshavela Branch #1 0160, 11, Vazha-Pshavela Ave Saakadze Branch 0160, 6, Shartava St. (Saakadze Sq.) Saburtalo Branch 0160, 12, Al. Kazbegi Ave. Tbilisi Central Service Center 0112, Vagzali Sq. 2 Agmashenebeli Branch #1 0102, 138, Agmashenebeli Ave. Marjanishvili Branch #2 0102, 16, Marjanishvili St. Tamar Mepe Branch 0112, 7, Tamar Mepe Ave. Head Office & Marjanishvili Branch 0102, 7, Marjanishvili St. Tsereteli Branch #2 0119, 73a, Tsereteli Ave. Didube Branch 0119, 117, Tsereteli Ave. Digomi Branch in shop («My House») 0131, Agmashenebeli Alley, 12th km, furniture shop «My House» Digomi Branch in “Goodwill” 0131, 1, Parnavaz Mepe Ave. (Hypermarket Goodwill) Nadzaladevi Branch 0180, 109, Dadiani Ave. Gldani Branch 0172, Mukhiani Settlement, Plot 1/6 Tbilisi Airport Service Center 0158, Tbilisi National Airport

TBILISI ATMS Vazisubani Vazisubani III dstr., II Blk. Sanzona 50, Guramishvili Ave. Nikora Store Vake 11, Chavchavadze Ave. Vake Branch 1, Tamarashvili St. Pharmacy “36.6” 34, Chavchavadze Ave. Trading Center “Pixel” 7, Kipshidze St. 41, Abashidze St. Vake Service Center #1 29, Chavchavazde Ave. TBC Bank Branch 59, Paliashvili St. “Simba” Supermarket 50, Chavchavadze Ave. 15, Phaliashvili St. Aversi Pharmacy Vera 7, Kostava St. 36, Kostava St. Cinema “Amirani” 8/1, Akhvlediani Ave 18, Melikishvili St. 60, Barnovi St. “Fresh Market” 31, Melikishvili St. TBC Bank branch Mtatsminda 13, Rustaveli Ave. Hotel «Tbilisi Marriot» 11, Rkinis Rigi Acura Billiard Room 5, Rustaveli Ave. Rustaveli Cinema 4, Freedom Square 22, Leselidze St. TBC Bank branch 52, Rustaveli Ave. TBC Bank branch 44, Rustaveli Ave. TBC Bank branch 1, Rustaveli Ave. TBC Bank branch Avlabari 84, K. Tsamebuli Ave. 2, K. Tsamebuli Ave. TBC Bank branch Navtlugi 2, Cholokashvili St. “36.6” Pharmacy Varketili 34a, Kakheti Highway 44, Javakheti St. (Varketili Metro) Varketili 3, 4th m/r. Javakheti St. TBC Bank branch Isani-Samgori 39a, Moscow Ave. 169, Khmelnitski St. Supermaket “Isani” subway station 67, K.Tsamebuli Ave. TBC Bank branch Saburtalo 40, Vazha Pshavela Ave. ESM Tbilisi 67, Vazha Pshavela Ave. «Nikora» Shop 68, Kostava St. Public Television Building 22, Bakhtrioni St. 53, Saburtalo St. Nikora store 12, Al. Kazbegi Ave. At Saburtalo Branch 74, Kostava st. Shop “Caesar” Z. Zhvania Sq., 45, Gamsakhurdia Ave. “PSP” Pharmacy 1, Nutsubidze St. 52, Vazha-Pshavela Ave. Mobi Shop Riverside named after H. Aliev At Wissol gas station Turn at 4th Plateau of Nutsubidze 179, Nutsubidze St. “PSP” Pharmacy 26, Kazbegi Ave. Shop “Planeta Z” Vazha-Pshavela V Blk, 4 Bld. 29, Gamsakhurdia Ave. Shop “Okaidi” 6, Shartava St. 4, Gamsakhurdia Ave. 11, Vazha-Pshavela Ave TBC Bank Branch 11, Mitskevichi St. Supermarket 29b, Kazbegi Ave. 73, Vazha-Pshavela Ave. TBC Bank branch 11/5, Dolidze St. Supermartket “Mango” Chugureti 39, Chitaia St.

Aversi Pharmacy 7, Marjanishvili St. Marjanishvili branch 19 Tsabadze St. Trade center «Pasazhi» 8, Tsabadze St. Trade center «Kidobani» 4, Khetagurov St. Humana Pharmacy 16, Marjanishvili St. TBC Bank branch 4, Chubinashvili St. Aversi Pharmacy Didube 73a, Tsereteli Ave. At #2 Didube Branch 114, A. Tsereteli Ave. «Coca-Cola» 117, Tsereteli Ave. At Didube Branch 82, Tamar Mepe Ave. “MedService” Pharmacy 1, Tsereteli Ave. Trading Center “Panda” 7, Tamar Mepe Ave. TBC Bank branch 138, Agmashenebeli Ave. TBC Bank branch 12, Kereselidze St. “Megaline” Trading Center Digomi Digomi District 3/2 Digomi District II BLK. Building 7 Digomi District, 3rd blk. D. Agmashenebeli Alley “Lukoil” Gas station Didi Digomi Entrance of Didi Digomi Trade center GOODWILL 12th Km, Agmashenebeli Alley. Shop “Chemi Sakhli” Nadzaladevi 106, Ts. Dadiani Ave. Nadzaledevi Branch 321, Ts. Dadiani Ave. Aversi Pharmacy 144, Ts. Dadiani Ave. Supermarket Temka Temka, 10th Block, BLD. 2. Gldani Gldani District 1st blk. Supermarket “Bingo” Akhmeteli Metro Trading Center “Mariami” Mukhiani Settlement, Plot 1/6 TBC Bank branch Mukhiani Mukhiani III MKR, Dumbadze Ave., BLK.5a Mukhiani II M/R, Noneshvili St., BLk. 5 “Red A” Pharmacy Avchala 3, Sarajishvili St. “Alfa Express” Ortachala 39, V. Gorgasali St. 28, Gorgasali St. Airport Tbilisi International Airport

CONSTANTA BANK BRANCHES AND ATMS Tbilisi Sadguri Branch 137, Tsinamdzgvrishvili Street Varketili Branch 20, Vazisubani turn Isani Branch 84/86, Ketevan Tsamebuli Avenue Gldani Branch The right side of the Akhmeteli Subway Didube Branch 117, Tsereteli Ave Lilo Branch 2, Chirankhuli Str. Saburtalo branch 28, Vaja-Pshavela Str. Baratashvili Branch 2, Baratashvili Str.

BANK OF GEORGIA TBILISI Mtatsminda-Krtsanisi 3 Pushkin Str. 4 Leselidze Str. 38 Tabukashvili Str. 7 Pushkin Str. 1 Vekua Str. 3 Pushkin Str. Vake-Saburtalo 24 Kostava Str. 29 Vazha-Pshavela Ave. 7 Kipshidze Str. 14 Gamsakhurdia Ave. 22 Bakhtrioni Str. 72/12 I.Abashidze Str. 70 Kostava Str. Sheraton Metheki Palace 10 Melikishvili Ave. 62 Chavchavadze Ave. Mtatsminda-Krtsanisi 8 Rustaveli Ave. (Parliament) 38 Tabukashvili Str. 19 Rustaveli Ave. 4 Freedom Square (Courtyard Marriott) Metro Station “Tavisuplebis Moedani” Metro Station “Rustaveli” 3 Vekua Str. (Populi City) 37 Gorgasali Str. Ortachala Radisson SAS Iveria Hotel Isani-Samgori 10 Ketevan Tsamebuli Ave. 80 Ketevan Tsamebuli Ave. 7 Kalaubani Str. Airport Metro Station “Avlabari” Metro Station “300 Aragveli” Metro Station “Samgori 1” Metro Station “Samgori 2” Metro Station “Varketili” Metro Station “Isani” Temqa Block 10, Bulding 25 44 Moskovi Ave. Vazis ubani block 4 (“Populi”) Vake-Saburtalo 41 Vazha-Pshavela Ave. 23 Chavchavadze Ave. 70 Kostava Str. 16 Gamsakhurdia Ave. 7 Petritsi Str. Melikishvili Str. 10 Gldani-Nadzaladevi 39 Tsotne Dadiani Str. 5 Tornike Eristavi Str. (“Electroplast”) Shopping Mall “Mariami”, Gldani Metro Station “Akhmeteli” Metro Station “Grmagele” Metro Station “Nadzaladevi” Metro Station “Sarajishvili” Metro Station “Guramishvili” Mukhiani, Block 4, Bulding 4 34 Tsotne Dadiani Str., Bulding 8 Metro Station “Elektrodepo” Vake-Saburtalo 1a Bulachauri Str. Metro Station “Politeknikuri Instituti 1” Metro Station “Politeknikuri Instituti 2” Metro Station “Vazha-Pshavela” Metro Station “Sameditsino Instituti 1” Metro Station “Sameditsino Instituti 2” Didube-Chugureti 99 Tsereteli Ave. 18 Tamar mefis Ave. 60 Tsereteli Ave.

83/23 Davit Agmashenebeli Ave. 142 Davit Agmashenebeli Ave. 19 Tsabadze Str. (“Pasazhi”) 12 Kereselidze Str. 1st turn (“Megaline”) 137 Tsinamdzgvrishvili Str. 127 Davit Agmashenebeli Ave. Metro Station “Vagzlis Moedani” Metro Station “Vagzlis Moedani 3” Metro Station “Tsereteli” Metro Station “Didube” Metro Station “Marjanishvili” 3 Vagzali Str. Gldani-Nadzaladevi Gladni 1 Vekua Str., Block “a” 38 Guramishvili Ave.

ATM’S TBILISI Vake 8 Mtskheta Street 12 eristavi street 72/12 Abashidze Street 48 Chavchavadze Avenue 22/23 Chavchavadze Avenue 22/23 Chavchavadze Avenue 62 Chavchavadze Avenue 50 Chavchavadze Avenue 52 Chavchavadze Avenue 22 Chavchavadze Avenue 78 Chavchavadze Avenue 7 Kipshidze Street 9a nafareuli street 13 Kipshidze Street 2 Berdzenishvili Street 41 abashidze street 81/9 Abashidze Street 3 Tamarashvili Street Tamarashvili Street 16 Phaliashvili Street Tskneti 3 Rustaveli Street 2 Rustaveli Street Saburtalo 67 Vazha-Pshavela Avenue 41 Vazha-Pshavela Avenue 41 Vazha-Pshavela Avenue 2 Vazha-Pshavela Avenue 27b Vazha-pshavela avenue 27a Vazha-Pshavela Avenue 17 Vazha-Pshavela Avenue 27 Vazha-Pshavela Avenue 72 Vazha-Pshavela Avenue Vazha-Pshavela Avenue, II Block 35/37 Shartava Street 7 Shartava Street 21 Dolidze Street vakhushti bridge Saakadze square Samedicino Vazha-Pshavela Politeqnikuri 1 Politeknikuri 2 17a Saburtalo Street 37 Saburtalo Street 70 Kostava Street 70 Kostava Street 26 maisi street 1 26 May square Kostava Street 44 Khazbegi Avenue 10 Khazbegi Avenue 13 Khazbegi Avenue 14 Khazbegi Avenue 12 Khazbegi Avenue bagteriofagi 8 a mitschkevichi street 19 Gamrekeli Street 23 kandelakis street 43 Gamsakhurdia Avenue. gagarini 16 Gamsakhurdia Avenue 2 Gamsakhurdia Avenue 14 Gamsakhurdia Avenue 1a Bulachauri Street 3 mk.2 kv. Nucubidze 175 Nutsubidze Street 221 Nutsubidze Street 25 nutsubidze street Nutsubidze plato III mr. II kv 1 Sandro Euli Street 13 Bakhtrioni Street 22 Bakhtrioni Street 6 Phanaskerteli Street 16 Chikovani Street 25 Kavtaradze Street 4 Gabashvili Street 5 Jikia Street Mtatsminda 2 Freedom Square mtawminda square 3 Pushkin Street 3 Pushkin Street 3/1 Pushkin Street 3 Pushkin Street Tavisuplebis Moedani 7 Pushkin Street 4 Freedom Square 12 Chanturia Street Rustaveli 16 Rustaveli Avenue 8 Rustaveli Avenue 19 Rustaveli Avenue 37 Rustaveli Avenue 2 Leonidze Street 22 Leselidze Street 4, Leselidze Street 38 Tabukashvili Street 2 Baratashvili Street 7 Ingorokva Street GTC 8 Erekle II Street 13 Savteli Streer 20 Akhvlediani street 1 Vekua Street 40 Khetagurovi street rose squire rose squire Vera 28 petriashvili street 25 Kostava Street 24 Kostava Street 44 Kostava Street 1 Khorava Street 10 Kekelidze Street 8 Kuchishvili Street 50 Gogebashvili Street 13 Melikishvili Street 10 Melikishvili Street 10 Melikishvili Street Gldani-Nadzaledevi 2 gudamakhari street Gldani V m/r Block14 Gldani III m/r 2 Khizanishvili Street 2 Dadiani Street 7 Dadiani street 34 Dadiani Street 151 Dadani Street 21 Sarajishvili Street Sarajishvili Grmagele Guramishvili 38 Guramishvili Avenue 33a GuramiSvili avenue 84 Guramishvili Avenue 7 Guramishvili Avenue 84 Guramishvili Avenue Peikrebi street Mukhiani, IV m/r, 4 block Dumbadze str IV m/r, Block 5 Nadzaladevi Nadzaladevi metro Square 15 Khizanishvili Street 31 Khizanishvili Street metro axmetelis mimdebare. mariami metro axmetelis mimdebared 1 Vekua Street 1 Vekua Street Akhmeteli Temka 10 Kv, Block 25 Temka samshobiaro saxli # 5 mimd 34 Khosharauli Street Didube-Chugureti 8 tsabadze street 17 Uznadze Street 1 Tsereteli avenue 60 Tsereteli Avenue

55 Tsereteli Avenue 95 Tsereteli Avenue 110 Tsereteli Avenue 99 Tsereteli Avenue 118 Tsereteli Avenue 118 Agmashenebeli Avenue 127 Agmashenebeli Avenue 80 Agmashenebeli Avenue 96 Agmashenebeli Avenue 1 Agmashenebeli Avenue 89/24 Agmashenebeli Avenue 86/90 Agmashenebeli Avenue 15 Tamar Mepe Avenue 10 Tamar Mepe Avenue 20 General Kvinetadze Street 5 marjanishvili street Marjanishvili 83/23 Agmashenebeli street 1 Chitaia Street 19 Tsabadze Street, pasage 2 Chkheidze Street Tbilisi central Tsereteli Vagzlis moedani 2 Vagzlis Moedani 1 Vagzlis Moedani 2 19 Agladze Street 2 Vagzlis Moedani 95 Tsinamdzgvrishvili Street 137 Tsinamdzgvrishvili Street Mtkvari Left Riverside (mushtaedi) 1 chaladze street Digomi 8 chachava street Military Base (vashlijvari) Digomi II kv. 5 Block Digomi Block V, I a Building 11 George Balanchini Street Agmashenebeli alley II km Agmashenebeli alley 9 km. Agmashenebeli alley Didi Digomi way. Digomi village way (vashlijvari) 8 Petritsi Street 7 Petritsi Street 10/12 Godziashvili Street Vashlijvari Agmashenebeli alley 13 km 6 gelovani avenue 5 Lubliana Street Isani-Samgori Isani Samgori 1 Samgori 2 Varketili Varketili 3, IVm/r, near by 410 Building 1 Khomleli street 64 Javakheti street Vazisubani IV m/r I block, petefi str. Vazisubani IV m/r I block 2 Landia street 300 Aragveli Kakheti Highway 21km 60 Kakheti Highway Military Base (alekseevka) Military Base (alekseevka) AIR 3a Khomleti Street 10 Ketevan Tsamebuli Avenue 80 Ketevan Tsamebuli Avenue 51a Ketevan Tsamebuli Avenue 4 Kiziki Street Airport Airport Airport Military Base (vaziani2) 7 Kalaubani Street 7 Kalaubani Street 14 Kalaubani Street 39 Moscow Avenue 17 chichinadze street 44 Moscow Avenue 10 Telavi Street Avlabari Avlabari Metro Square 8/10 Chekhov Street 23 Shuamta Street 155 bogdan khmelnitski street 6/4 Naftlukhi Street Atskuri, isnis metros mimdebare Kairo & Javakheti Street 64 Melaani Street 1 Abdushelishvili street 122 Kakheti Highway market lilo 113 gakhokidze street 38 Kakheti Highway Krtsanisi 41 Gorgasali Street 39 Gorgasali Street Military Base (krtsanisi)2 Military Base (krtsanisi) 16 Gorgasali Street 16 Gorgasali Street 6 Gorgasali Street 77 Gorgasali Street 117 Gorgasali Street 37 Gorgasali Street 19/2 Rustavi Highway 7 a krtsanisi street 10 Gulua Street Kodjori military base Mtskheta 23 arsukidze street Bebriscixis mimdebared 12 samxedro street

BANK REPUBLIC TBILISI BRANCHES AND SERVICE CENTERS Head Office and Central Branch 2 Gr. Abashidze St. Tel: (995 32) 292.55.55 Fax: (995 32) 292.55.44 Vake 13 Chavchavadze Ave. (24 hour) 33a Paliashvili St. Freedom Square 2, Leonidze St. Airport International Airport (24 hour) 24 hours, except Christmas and Easter Didube 10 Building, Tsereteli Ave. Sadguri 10, Tamar Mephe Ave. Sadguri Near the Railway Station Sanzona 34 Guramishvili Ave. Nadzaladevi 34 Dadiani Ave. Saburtalo 28 Pekini Ave. 71 Vazha-Pshavela Ave. 47 A. Kazbegi Ave. Isani 6/2 Navtlughi St. Gldani 20 Khizanishvili St. Mukhiani 8b Block, IVa micro district Iashvili Clinic 2/6 Lubliana St. Police Office 8 Gulua St. Dighomi 1b Block, 1 micro district, Dighomi Building of City Court of Tbilisi David Aghmashenebeli Alley VI km. Ortachala 37 Gorgasali St. Varketili Aerodrome Settlement. St N 29-31

ATM Tbilisi Vake

2 Gr.Abashidze St. 13 Chavchavadze Ave. 33 A Paliashvili St. 1 Chavchavadze Ave. 49b Chavchavadze Ave. 50 Chavchavadze Ave. 2 Mosashvili St. Mrgvali Bagi 7 Kibshidze St. Mtatsminda 27 Kostava St. 32 Br/Zubalashvili St. 20 Rustaveli St. 10 Pushkini St. 8 Erekle II 2, Leonidze St. 4 – 9aprili St. 24 Gorgasali St. Ministry of Justice 24 Gorgasali St. General Office of Public Prosecutor 37 Gorgasali St. 8 Gulua St. Saburtalo 75 Kostava Ave. 16 Kazbegi Ave. 47 Kazbegi Ave. 2 Gamsakhurdia Ave. 23-25 Gamsakhurdia Ave. 28 Gamsakhurdia Ave. 45 Gamsakhurdia Ave. 6 Shartava St. 19 Nutsubidze St. 179 Nutsubidze St. 5 Sandro Euli St. Nutsubidze Plato 3rd , 5 Dzotsenidze St. 13 Bakhtrioni St. 11 Dolidze St. Building 4/5 34 Vaja Pshavela Ave. Vaja Pshavela Ave. 48 Vaja Pshavela Ave. 71 Vaja Pshavela Ave. 72 Vaja Pshavela Ave. Building 1, Block of flats 7, Vaja Pshavela Ave. Kavtaradze St. Digomi 1st Block, 1 Micro District, Dighomi Masivi 9 Mikeladze St. 3rd Block, Dighomi Masivi Aghmashenebeli alley 6 th km. Aghmashenebeli alley 2/6 Lubliana St. 5 Lubliana St. 13 Petritse St. Didi Digomi Didube-Chugureti 1 Khetagurovi St. 2 Tsereteli Ave. Tsereteli Ave. Building 10 67 a Tsereteli Ave. 144 Tsereteli Ave. 10 Tamar Mephe Ave. Near Railway Station 44 Aghmashenebeli Ave. 4 Chubinashvili St. 19 Vakhtang Bagrationi Ave. 19 Tsabadze St. Isani-Samgori International Airport of Tbilisi, „Sakaeronavigatsia“ International Airport of Tbilisi, Airport Service Center Kakheti highway 112 Kakheti highway 6/2 Navtlughi St. 23 “Ghvinis Aghmarti” Varketili Subway Territory 7 Varketili, Kaloubnis St. 9 Tsinandali St. 91 Ketevan Tsamebuli Ave. Opposite side 2 Ketevan Tsamebuli square 44 Moscow Ave. Vazisubani III Mik. II Block #15 Gldani-Nadzaladevi 34 Dadiani St. 39 Dadiani St. 263 Dadiani St. 20 Khizanishvili St. Mukhiani 2nd , Block #5 (Noneshvili St.) Mukhiani, Building 8, 4a m/d Temka District, Building 10, 2 m/d, Block of flats: 25 34 Guramishvili Ave. 36 Guramishvili Ave. Subway Sadguri, Akhmeteli Theatre Territory

VTB BANK Tbilisi 37, Uznadze Str. 14, Chanturia Str. 5, Jikia Str. 3, Gotua Str. 6, Gorgasali Str. 16/18, Rustaveli Ave. 54, Chavchavadze Ave. 10, Chavchavadze Ave. 21, Vazha Pshavela Ave. I tr. 33, Kostava Ave. 16/18, Tamar Mepe Ave. 4, Leselidze Str. 15, Tamar Mepe Ave. 76, Tsereteli Ave. 3, Vani Ave. 147, D. Aghmashebeli Ave. 5, Khizanishvili Str. 12, Ketevan Tsamebuli Ave. 20, Telavi Str. 42, Al. Kazbegi Ave. 8, Tsabadze Str. 6/2, Navtlughi Str. 9, Tsinandali Str. 48a, Bogdan Khmelnitsky Str. 19, Gamrekeli Str. 143, Tsereteli Ave. 78, Nutsubidze Str. Aghmashenebeli Alley 60, Barnov Str.

KSB BANK TBILISI BRANCHES Vake (09.30-21.00) 43, Chavchavadze ave. Avlabari 3, Ketevan Tsamebuli str. Vera 8/2, Melikishvili str. Didube 60, Tsereteli ave. Agmashenebeli 147, Agmashenebeli ave. Varketili 7, Kaloubani str. Krtsanisi 37, Gorgasali str. Pekini (09.30-20.30) 24a, Pekini ave. Didi Digomi 8, Ioane Petritse str. Gldani 15, Khizanishvili str. Freedom sq. branch (24 hour) 4, Freedom sq. Service centre - Gudushauri hospital (24 hour) 18/20, Lubliana str.

ATM’S TBILISI Vake – branch 43, Chavchavadze ave. Vake - Fashion house 24, Chavchavadze ave. Avlabari - branch 3, Ketevan Tsamebuli str. Vera - branch 8/2, Melikishvili str. Didube - branch 60, Tsereteli ave. Agmashenebeli Avenue - branch 147, Agmashenebeli ave. Varketili - branch

7, Kaloubani str. Krtsanisi - branch 37, Gorgasali str. Pekini - branch 24a, Pekini ave. Didi Digomi - branch 8, Ioane Petritse str. Agmashenebeli Alley - Prosecutor 12 km, Agmashenebeli Alley Gudushauri Hospital 18/20, Lubliana str. Gldani - branch 15, Khizanishvili str. Freedom sq. - branch 4, Freedom sq. Publich Television 68, Kostava ave. Public Service Hall 2, Sanapiro str. Mtatsminda-Krtsanisi, Revenue Service 16, Gorgasali str. Mtatsminda-Krtsanisi, Revenue Service 4, General Gulua str. Georgian railway 15, Tamar Mepe ave. Trade center Panda 1, Tsereteli Ave. Agmashenebeli Avenue 96, Agmashenebeli ave. Old Tbilisi 5, Virsaladze str. Church store 67, Vazha-Pshavela ave. Book store 14, Vazha-Pshavela ave. Dighomi district 2nd block, building 6a. Airport customs clearance zone Old airport Lilo customs clearance zone Martkopi,Gardabani Region

LIBERTY BANK BRANCHES IN TBILISI Vake-Saburtalo Central Branch 74, I. Chavchavadze Ave. Central Branch’s s/c #1 2, Sanapiro St. Didi Dighomi s/c #1 9, I. Petritsi St. Pavilion #1 10-12, Vazha-Pshavla Ave. Pavilion #2 Kostava St. (Near Sports Palace) Pavilion #4 33-35, I. Tchavtchavadze St. (Near Hospital 9) Pavilion #9 48-66, Vazha-Pshavela Ave. Pavilion 13 13 Km. Aghmashenebeli Highway Saburtalo s/c #1 34, Pekini St. Saburtalo s/c #2 7, Shartava St. Saburtalo s/c #7 2g, B. Zhgenti St. (Nutsubidze District) Saburtalo s/c #8 6, Budapeshti St. Saburtalo s/c #9 5, Kavtaradze St. Saburtalo s/c #11 10 Km. Aghmashenebeli Highway Sopeli Dighomi s/c #1 Village Dighomi, B. 7b Saburtalo s/c #15 2, Gamsakhurdia St. s/c #332 70, Tchavtchavadze Ave. Saburtalo s/c #13 3, Micro-District Nutsubidze Saburtalo s/c #14 46, Dolidze St. / 41, Balanchivadze St. Tskneti s/c #1 3a, Rustaveli St. Vake-Saburtalo Branch 2, Marijani St. Vake s/c #2 1, Mosashvili St. Vake s/c #3 84, Tchavtchavadze Ave. (National Agency Bureau) Vake s/c #4 38, Paliashvili St. Vake s/c #12 14, Kipshidze St. Mtatsminda-Krtsanisi Krtsanisi s/c #1 10, Kikodze St. Krtsanisi s/c #2 2a, Sanapiro St. Mtatsminda-Krtsanisi Branch 37, Gorgasali St. Mtatsminda s/c #1 24, Kostava St. Mtatsminda s/c #4 3, Kostava St. Turn 2 Ponitchala s/c #1 19, Rustavi Road, B. 4 Ponitchala s/c #2 3, Micro-District Ponichala, B. 2 Didube-Chughureti Chughureti s/c #2 153, Aghmashenebeli Ave. Chughureti s/c #3 3, Abashidze St. Chughureti s/c #4 21, Chitaia St. Digomi s/c #2 7, Robakidze St. Didube Branch 126, Tsereteli Ave. Didube s/c #1 60, Tsereteli Ave. Pavilion #5 A. Tsereteli St. (near Tsereteli Underground) Pavilion #10 Dighomi (Near Mayakovsky Monument) Pavilion #15 Didube (near the railway square) Gldani-Nadzaladevi Avtchala s/c #1 1, Libani St. Avtchala s/c #2 7, Libani St. Avtchala s/c #3 5, Sarajishvili Ave. Gldani Branch 3, Block Gldani Gldani s/c #2 Mukhiani (Near Akhmeteli Subway Station) Gldani s/c #4 3, Block Gldani, B. 86 Gldani s/c #5 7, Micro-District Gldani (Prison Gldani) Gldani s/c #6 2, Botchorishvili St. Gldani s/c #7 6, Micro-District Gldani, 11 Tiulenevi St. Gldani s/c #9 8, Micro-District Gldani, B. 23 Gldani s/c #10 2, Micro-District Gldani, B. 24b Gldanula s/c #1 Gldani Khevi (Ravine), Near B. 6a Gldani s/c #11 18, Gombori St. Lotkini s/c #1 164, Tseronisi St. Mukhiani s/c #2 2, Micro-District Mukhiani, B. 5 Mukhiani s/c #3 3, Micro-District Mukhiani, B. 5 Nadzaladevi Branch 36, Guramishvili Ave. Nadzaladevi s/c #1 34, Dadiani St. Nadzaladevi s/c #3 261, Dadiani St. Nadzaladevi s/c #4 12a, Guramishvili Ave. Nadzaladevi s/c #6 30, Guramishvili Ave. B. 1 Temka s/c #1 11, Micro-District Temka, Block 1 Temka s/c #2 3, Micro-District Temka, Block 3, Near B. 41 Zahesi s/c #1 1a, Tchitchinadze St. Isani-Samgori Afrika s/c #1 27, Tchitchinadze St. Afrika s/c #2 17, Tchitchinadze St. Isani-Samgori Branch Kakheti Alley 2 Isani s/c #1 51/2, Ketevan Tsamebuli Ave. Isani s/c #4 22, Metekhi St. Isani s/c #6 30 Km. Kakheti Highway Isani s/c #7 Moscow Ave, Block 2, B. 1 Isani s/c #9 90, Ketevan Tsamebuli Ave. Lilo s/c #1 Lilo Settlement, Block 2, B. 8 Pavilion #6 4, Abzianidze St., Orkhevi Settlement (Near Customs Department) Pavilion #8 10 b, Airport Settlement Pavilion #11 103, Kvareli St.(Metromsheni Settlement) Pavilion #12 10, Akhalubani St. Ponitchala s/c #3 Rustavi highway, KM 30 Samgori s/c #1 37, Moskovi Ave. Samgori s/c #2 36a, Trialeti St. Samgori s/c #4 151, Bogdan Khmelnitski St. Varketili s/c #1 Javakheti St. Second BlindAlley (Near Varketili Subway Station) Varketili s/c #2 3, Micro-District Varketili, B. 310 Varketili s/c #3 Varketili Block 10, B. g Varketili s/c #5 Tbilisi International Airport Varketili s/c #6 3, Micro-District Varketili Varketili s/c #7 12, Shuamta St. Varketili s/c #9 1, Micro-district varketili 3, Near B. 25 Varketili s/c #10 Kaloubani St. 9 Vazisubani s/c #1 4 Micro-District Vazisubani 1B,Shandor Petofi St. Vazisubani s/c #2 2, Micro-District

Vazisubani (Super Market “Smart”) Vazisubani s/c #3 1, Shandor Petofi St Didgori Didgori s/c #1 97, Block Tabakhmela, plot 516

ATM’S IN TBILISI 1, Aleksidze St. Agmashenebeli Alley, KM 11. 10a, Akhmeteli St. 13, Bakhtrioni St. 6, Budapeshti St. Zhvania Square 2, Gamsakhurdia Avenue 2/4, Godziashvili St. Block 3, Didi Dighomi Building 11, Dolidze St. 1, Vazha-Pshavela Avenue 10-12, Vazha-Pshavela Avenue 27, Vazha-Pshavela Avenue (near subway station “Sameditsino”) 76b, Vazha-Pshavela Avenue Block 2, Vazha-Pshavela Avenue (near Vazha-Pshavela monument) 46-48, Vazha-Pshavela Avenue (near metro station “Delisi”) 55, Vazha-Pshavela Avenue Block 7, Vazha-Pshavela Avenue Vashlijvari highway 10a, Tamarashvili St. 15a, Tamarashvili St. Kostava St. (near the Sports Palace) 24, Kostava St. 64, Kostava St. Marshal Gelovani Avenue 10, Mitskevitchi St. Nodar Bokhua St. 183, Nutsubidze St. (II-IV plateau turn) III m/d, Nutsubidze plateau 14, Gamsakhurdia St. 15, Gamsakhurdia Avenue 34, G a m s a k h u r d i a ave. 9, I. Petritsi St. 28, Saburtalo St. 2, University St. 36, Phaliashvili St. 5, Kavtaradze St. 21, Kavtaradze St. 2, Kazbegi Avenue 15, Kazbegi Avenue. Kazbegi Avenue (near the school #60) 26, Kazbegi Avenue (Vake-Saburtalo crossroads) 7, Shartava St. Block 1, IV m/d, shandor Petofi St. 10, Tchavtchavadze St. 34, Tchavtchavadze St. 74, Tchavtchavadze Avenue Tchavtchavadze Avenue (near to Hospital No. 9) 84, Tchavtchavadze Avenue (Legal expertise) Tchavtchavadze Avenue (near to school #55) Didube-Chugureti 96, Aghmashenebeli Avenue 153, Aghmashenebeli Avenue 10th km, Aghmashenebeli Alley 1, Beliashvili St. Dighomi, near to Mayakovsky monument Tevdore Mghvdeli St. (near to the Railway Station) 27, KingTamarAvenue 7, Robakidze St. 8, Tsabadze St. 2, Tsereteli Avenue Tsereteli Avenue (nearto subway station “Tsereteli”) 126, Tsereteli Avenue 143, Tsereteli Avenue 144, Tsereteli Avenue 69, Tsereteli Avenue (corner of Vani St.) 7-7a-7b, Tsereteli Avenue 60, Tsereteli Avenue 5/12, Ketevan Tsamebuli Avenue 39, Chitaia St. 17, Tc hitchinadze St. Gldani-Nadzaladevi 2, Botchorishvili St. Gldani, M/D 3. Gldani, M/D 3, Building 86, Near to building 22, Gldani M/D 6 Gldani, M/D 7 (Gldani prison # 8) 12a, Guramishvili Avenue 36, Guramishvili Avenue Guramishvili Avenue (near the subway station “Grmagele”) Guramishvili Avenue (near the subway station “Sarajishvili”) 34, Dadiani St. 34, Dadiani St. 261, Dadiani St. Building 2, 2nd m/d, Dadiani St. 22, Dumbadze St. (Mukhiani settlement) 1a, Chichinadze St., ZAHESI, near the building 41, block 3, 3rd m/d, Temka near maternity house No. 5, block 1, 11th m/d, Temka Kakheti 2nd turn 1, Liban St. Mukhiani turn near the subway station “Akhmeteli” 1, Sarajishvili St. 8, Kerchi St. 146, Tseronisi St. 4, Khetagurov St. 6, Khizanishvili St. Isani-Samgori 1, Abdushelishvili St. Airport settlement 10, Akhalubani St. 151, Bohdan Khmelnytsky St. 6, Gulia St. Building C, block 10, 3rd massif, Varketili Building 310, 3rd m/d, Varketili 3 Tbilisi International Airport Kakheti highway KM 38. 112, Kakheti highway 37, Moscow Avenue 8, Navtlughi St. Orkhevi settlement (near to Customs Department) Saknavti settlement (Kakheti highway) Building 8, block 2, Saksopmankana settlement 103, Kvareli St. (Metromsheni settlement) 22, Javakheti St. Javakheti St. Second turn Mtatsminda-Krtsanisi 23, A. Tchavtchavadze St. 37, Vakhtang Gorgasali St. 93, Vakhtang Gorgasali St. 155, Vakhtang Gorgasali St. 48, Zubalashvili St. 1, Leonidze St. 10, Leonidze St. 22, Metekhi St. 9, Pushkini St. 3, Rustaveli Avenue 2a, Sanapiro St. 10, Kikodze St. 5, Chachava St. 37/4, Tsintsadze St. Ponitchala Rustavi highway, KM 30 Building 2, 3rd m/d, Ponichala settlement Old Tbilisi 12, Kaloubani St. Didgori Plot 516, block 97, village Shindisi, Didgori

ATM’S IN REGIONS Abasha 6, Jorjikia St. Adigeni 24, Tornike Eristavi St. Ambrolauri 18, Agmashenebeli St. Settlement Anaklia

Aspindza 31, Vardzia St. Akhalkalaki 82, KingTamar Avenue 11, Charenta St. 71, Tavisupleba St. Akhaltsikhe 1, Tamarashvili St. 98, Rustaveli St. 11, KingTamar St. 2, Shalva Akhaltsikheli St. 1, Kharischirashvili St. 6, Iadze St. Akhmeta 2, Kazgebi St. Batumi 63, Gorgiladze St. 2, Sulkhan-Saba St. 46-48, Vazha-Pshavela Avenue Khimshiashvili St. 11, Tbel Abuseridze St. 80, Javakhishvili St. 11, Pirosmani St. 10-12, Chavchavadze St. 20a, Agmashenebeli Avenue 9, King Parnavaz St. 62-64-66, King parnavaz St. 36, Gorgiladze St. 20, Khimshiashvili St. 102, Melikishvili St. 11/5, KingTamar settlement 75, Chavchavadze St. 16, Tavdadebuli St. 23, Mayakovski St. Baghdati 12, Tsereteli St. Bolnisi Settlement Kazreti 106, Sulkhan-Saba St. 107, Sulkhan-Saba St. Borjomi 7, Meskhishvili St. 147, Rustaveli St. 6, Tavisupleba St. Gardabani 71, David Agmashenebeli St. 89, David Agmashenebeli St. Gori 16, Stalini St. 40, Sukhiahsvili St. 56, Chavchavadze St. 26, Stalini St. 5, Guramishvili St. 43, Ertoba St. 39, Stalini St. Gudauri Hotel “Marco Polo” Gurjaani 10, Noneshvili St. KingTamar St. Village Shashiani Dedoplistskaro 1, Alazani St. 23, Rustaveli St. Dmanisi 41, St. Nino Street (Municipality) 29, Street St. Nino blind alley Dusheti 21, Dadiani St. 27, Rustaveli St. Vani 3, Solomon II St. Zestaponi 61, Agmashenebeli Avenue 11, Tsereteli St. Village Shorapani Zugdidi 45, Gamsakhurdia St. 90, Rustaveli St. 73, Sokhumi St. 7, Paris Commune St. 32, Gamsakhurdia St. 15, Tsotne Dadiani St. Tetritskaro 12, Kingtamar Avenue Telavi 43, Alazani Avenue 95, Alazani Avenue 16, Erekle the Second St. 3, Erekle the Second Square 12, Erekle the Second St. Terjola 2, Chanturidze St. Tianeti 11, Rustaveli St. Kaspi 88, Stalini St. 11, Rustaveli St. 18, Kostava St. Koda, village house Lagodekhi 23, Kiziki St. Lanchkhuti 10, Ninoshvili St. 24 Kingtamar St., Settlement Lentekhi Village house in settlement Manglisi Village Nigoeti Marneuli 1, Rustaveli St. 72, Rustaveli St. 73, Rustaveli St. Martvili 14, Tavisupleba St. Mestia 52, Kingtamar St. 1, Seti St. Mtskheta Building of regional governor ’s office 17, Kostava St. (near to the Svetitskhoveli Cathedral) 11a, Samkhedro St. Mtskheta highway 73a, Agmashenebeli St. 65, Mamulashvili St. Village Tserovani Ninotsminda 22, Tavisupleba square Ozurgeti 5, Gabriel the episcope St. Village Ozurgeti Tavisupleba Square Oni 16, Rustaveli St. Rustavi 21, Kostava St., near to the Municipality 14, Kostrava St. Megobroba Avenue 3, Megobroba Avenue 11, Megobroba Avenue 21st km, Red Bridge Highway 5, Tashkent St. Village Sartichala Sagarejo 2, Agmashenebeli Avenue Samtredia 11, Stalini St. Sachkhere 92, Kostava St. 17, Gomarteli St. Senaki 14, St. Nino St. 20, Ninoshvili St. Signagi 2, Rustaveli St. 2, Dadiani St. 18, Gelati St. Poti 12, D. Agmashenebeli St. 146, Chavchavadze St. 57, Agmashenebeli St. Village Poka Kareli 3, Ninoshvili St. 1, Mgaloblishvili St. Settlement Ruisi Keda 11, Tbel Abuseridze St. 1, M. Kostava St. Kobuleti 153, Agmashenebeli St. 4, Memed Abashidze St. 141, Agmashenebeli St. 478, Agmashenebeli St. 79, Kingtamar St., Village Chakvi

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Cinema

«Rustaveli» Cinema 5 Rustaveli Ave. Tel: 293-22-53, 2 555-000 «Captain America: The Winter Soldier» 3D; «Forgotten King»; «Rio 2» 3D; «Noah» 3D; «Paradjanov»; «The Grand Budapest Hotel»; «Parisian Dream»; «300: Rise of an Empire» 3D (Ticket Price: 7,50 - 12,50 GEL) «Amirani» Cinema 36 Kostava Str. Tel: 299-99-55 «Captain America: The Winter Soldier» 3D; «Rio 2» 3D «Noah» 3D; «The Grand Budapest Hotel»; «300: Rise of an Empire» 3D (Ticket Price: 7,50 - 12,50 GEL)

CALL: 2 999 662; 592 07 53 53

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Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Band Zarebi SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band “Wheels”, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili Restaurant “Dzveli Sakhli” 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Restaurant “Bermukha” Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet “Taoba”: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Café “Kala” 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Rezo Kiknadze - saxophonist Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Goblins» (Covers)

Tbilisi

Theatre

Day

Depart

Arrive

Flight#

Aktau

5.7

00:50

02:40

DV 842

Amsterdam

1.6

06:10

07:55

A9 651

Almaty

1.2.5.7

22:45;08:55

04:25+1;14:35

KC E90

Athens

06:15

07:15

A3 983

Baku

X 2.4

01:30;12:10

02:30;13:10

J2 224/226

Baku

DAILY

14:50;19:50

16:05;21:05

QR 975/977

Batumi

2.5.7

10:00;14:45

10:40;15:20

CRJ

Doha

DAILY

19:50;14:05

23:59;19:00

QR 975/977

Dubai

2.4.6.7

06:50

10:00

FZ 714

Istanbul

DAILY

06:20

06:40

PC/463

Istanbul

DAILY

05:15;18:15

05:45; 18:45

TK 387/383

Istanbul

DAILY

06:20

06:50

KK 320

Kiev

X3,5

07:50;17:30

08:20;17:55

PS 728

Minsk

DAILY

03:50

06:00

B2 736

Munich

DAILY

05:10

06:20

LH 2557

Riga

1.3.6

07:00

08:35

BT 723

Tbilisi Nodar Dumbadze State Central Children’s Theatre 99/1, D. Agmashenebeli Ave. Tel: 295-7874, 295-39-27 Snow White and the Seven Dwarfs Director: Dimitri Khvtisiashvili Cast: Nino Lezhava, Tamar Lortkipanidze, Nino Shushiashvili, Tamara Chanuyvadze, Kakha Gabelaia, Mariam Chukhrukidze, Nikoloz Kvantaliani, Nikoloz Nanitashvili, Gaga Shishinashvili Duration: 120 minutes Date: April 14 Hall: Big Stage Time: 12:00 Price: 7, 10 GEL Slammiпg Doors Director: Maya Chartolani Cast: Nino Lezhava, Nino Archaia, Khatia Melkadze, Berta Khapava, Ioseb Molodinashvili, Paata Kikvadze Duration: 90 minutes Date: April 14 Hall: Small Stage Time: 12:00 Price: 7, 10 GEL

Gallery

The exhibition of Sergo Kenchadze «Transrealism» Tbilisi Museum of History (Karvasla) 8 Sioni Str. Tel: 292-32-27 (Museum is working every day except Monday. From 11:00 till 17:00) till - April 25 Baia Gallery requests the pleasure of your company at the opening of Natia Japaridze’s exhibition «Space». Baia Gallery 10 Shardeni Str. Tel: 275-45-10 Gallery’s working hours: 12:00-19:00 till - April 16 The Young Artists Charity Exhibition «New Life» Zurab Tsereteli Museum of Modern Art 27, Rustaveli Ave. till - April 28 Exhibition of Lado Gudiashvili Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18 - 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - April 30 Dimitri Shevardnadze National Gallery invites you at the exhibition «Visions of Mexican Art». D. Shevardnadze National Gallery 11, Rustaveli Ave. Tel: 299-80-22 Gallery’s working hours: Saturday-Sunday 10:00-18:00 till - May 2

APRIL 15, 2013

Rome

05:25

06:40

AZ 551

Tel-Aviv

2.3.4.7

17:25

18:10

Vienna

4.7

08:55

09:25

A9 681

Urumqi

2.6

22:40

07:30+1

CZ 6040

Warsaw

2.3.5.7

05:40

06:15

LO 724

A9 695

Days=( 1-Monday., 2-Tuesday., 3-Wedsday., 4-Thursday., 5-Friday., 6-Saturday., 7-Sunday. D-Daily; X-except off)

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Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band «Wheels», DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Maia Kankava Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Goblins» (Covers)

Cinema

«Noah» 3D; «The Grand Budapest Hotel»; «300: Rise of an Empire» 3D (Ticket Price: 7,50 - 12,50 GEL)

Theatre

Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 Soon I will Come as Rain... Director: David Sakvarelidze Cast: Nino Tarkhan-Mouravi, Nino Makashvili, Temiko Tchitchinadze, Dato Darchia, Zaza Baratashvili, Datuna Gotsiridze, Natia Kvashali, Tamta Inashvili Date: April 15 Hall: Experimental Stage Time: 19:00 Price: 8, 10 GEL Marjanishvili Theatre 8 Marjanishvili Str. Tel: 2 955-966 Tango with Illegitimate Director: Ketevan Kharshiladze, Guram Vashakidze Cast: Kote Tolordava, Ia Shughliashvili, Eka Nijaradze, Lile Philphani, Nino Gomarteli, Nino Dumbadze, Tamar Bukhnikashvili, Nikusha Chikovani, Levan Gelbakhiani Duration: 140 minutes Date: April 15 Hall: Theatre in Attic Time: 20:00 Price: 11 GEL Liberty Theatre 2 Rustaveli Ave. Tel: 298-58-21 Jeans Generation Director: Davit Doiashvili Cast: Marina Janashia, Nana Darchiashvili, Goga Chkheidze, Dima Merabishvili, Merab Kolbaia, Lela Metreveli, Jaba Kiladze, Mariam Nadiradze, Apolon Kublashvili, Sandro Margalitashvili Duration: 165 minutes Date: April 15 Time: 19:00 Price: 6, 12, 14 GEL Georgian State Pantomime Theatre 37 Rustaveli Ave. Tel: 299-63-14 Shalikashvili 75 Date: April 15 Time: 19:00 Price: 10 GEL Tbilisi Nodar Dumbadze State Central Children’s Theatre 99/1, D. Agmashenebeli Ave. Tel: 295-78-74, 295-39-27 Natsarkekia Director: Dimitri Khvtisiashvili Cast: Khatia Melkadze, Badri Gvazava, Levan Katsiashvili, Giorgi Katchakhidze, Paata Mkheidze, Vakhtang Nozadze, Nino Lortkifanidze, Paata Kikvadze, Kakha Tcholadze Duration: 90 minutes Date: April 15 Hall: Small Stage Time: 12:00 Price: 7, 10 GEL

Gallery

APRIL 16, 2013

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Band Zarebi SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band «Wheels», DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/ Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian Dances Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Live Band Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «The Jumping General»

Cinema

Theatre

Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 The Soul Beings Director: Davit Sakvarelidze Cast: Tatuli Dolidze, Marina Kakhiani, Gela Otarashvili, Nino Mitaishvili, Temiko Chichinadze, Nino Tarkhan-Mouravi Duration: 105 minutes Date: April 16 Hall: Small Stage Time: 19:00 Price: 8, 10 GEL Marjanishvili Theatre 8 Marjanishvili Str. Tel: 2 955-966 Waiting for Dodo Director: Vato Jugheli Cast: Davit Dvalishvili, Koko Roinishvili, Paata Papuashvili, Lile Pilpani, Eka Mjavanadze, Davit Khurtsilava, Keti Chkheidze Date: April 16 Hall: Theatre in Attic Time: 20:00 Price: 11 GEL Marjanishvili Theatre (New Stage) 5 Marjanishvili Str. Tel: 2 955-966 Borders Director and Choreographer: Giorgi Osepashvili Cast: Ketevan Kitiashvili, Beka Goderdzishvili, Giorgi Osepashvili Duration: 140 minutes Date: April 16 Time: 20:00 Price: 14 GEL Liberty Theatre 2 Rustaveli Ave. Tel: 298-58-21 Honeymoon Director: Maya Doborjginidze Cast: Mariam Jologua, Salome Chulukhadze, Natia Kvashali Date: April 16 Time: 19:00 Price: 6, 9, 11 GEL Tumanishvili Film Actors Theatre 164 Agmashenebeli Ave. Tel: 234-28-99 Tiger and a Knight Director: Giorgi Sikharulidze Cast: Guga Kakhiani, Mzia Arabuli, Ana Nikolaishvili, Natia Metreveli Duration: 70 minutes Date: April 16 Time: 19:00 Price: 7 GEL Tbilisi Nodar Dumbadze State Central Children’s Theatre 99/1, D. Agmashenebeli Ave. Tel: 295-78-74, 295-39-27

Natsarkekia Director: Dimitri Khvtisiashvili Cast: Khatia Melkadze, Badri Gvazava, Levan Katsiashvili, Giorgi Katchakhidze, Paata Mkheidze, Vakhtang Nozadze, Nino Lortkifanidze, Paata Kikvadze, Kakha Tcholadze Duration: 90 minutes Date: April 16 Hall: Small Stage Time: 12:00 15:00 Price: 7, 10 GEL GEL Choosing the Bride Director: Medea Kuchukhidze Cast: Nino Archaia, Khatia Melkadze, Nino Papiashvili, Berta Khapava, Tamara Chanukvadze, Kakha Gabelaia, Badri Gvazava, Vano Dugladze, Levan Katsiashvili Duration: 130 minutes Date: April 16 Hall: Big Stage Time: 12:00 Price: 7, 10 GEL The Three Musketeers - Premiere Director: Giorgi Qantaria Cast: David Khakhidze, Nino Archaia, Khatia Melkadze, Nino Shushiashvili, Tamara Chanukvadze, Kakha Gabelaia, Vano Dugladze, Levan Katsiashvili Duration: 150 minutes Date: April 16 Hall: Big Stage Time: 19:00 Price: 7, 10 GEL

Gallery

APRIL 17, 2013

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band «Band’a’roll», DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/ Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala” 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Guliko Chanturia Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Good Company»

Cinema

Theatre

Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 First Love Director: Nikoloz Heine-Shvelidze Cast: Levan Berikashvili, Zviad Papuashvili, Keti Khitiri Duration: 75 minutes Date: April 17 Hall: Experimental Stage Time: 19:00 Price: 6 GEL Liberty Theatre 2 Rustaveli Ave. Tel: 298-58-21 The Caucasian Chalk Circle Director: Avto Varsimashvili Cast: Sandro Margalitashvili, Jaba Kiladze, Giorgi Jikia, Tamuna Nikoladze, Mariam Jologua, Tiko Kordzadze, Apolon Kublashvili, Goga Barbakadze, Marisha Kitia Duration: 240 minutes Date: April 17 Time: 19:00 Price: 6, 13, 15 GEL Tumanishvili Film Actors Theatre 164 Agmashenebeli Ave. Tel: 234-28-99 Storybird Director: Kote Mirianashvili Cast: Nino Burduli, Ana Nikolashvili, Darejan Jojua, Nana Shonia, Vakhtang Akhaladze, Vano Dugladze Date: April 17 Time: 19:00 Price: 10 GEL Gabriadze Theatre 13,Shavteli Str. Tel: 8 790 98-65-91 (MagtiFix), 298-65-90 Ramona Marionette Theatre Author and Director: Rezo Gabriadze +10 years Date: April 17 Time: 20:00 Price: 10, 15, 20 GEL

Gallery

The exhibition of Sergo Kenchadze «Transrealism» Tbilisi Museum of History (Karvasla) 8 Sioni Str. Tel: 292-32-27 (Museum is working every day except Monday. From 11:00 till 17:00) till - April 25 The Young Artists Charity Exhibition «New Life» Zurab Tsereteli Museum of Modern Art 27, Rustaveli Ave. till - April 28 Exhibition of Lado Gudiashvili Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18

- 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - April 30 Dimitri Shevardnadze National Gallery invites you at the exhibition «Visions of Mexican Art». D. Shevardnadze National Gallery 11, Rustaveli Ave. Tel: 299-80-22 Gallery’s working hours: Saturday-Sunday 10:00-18:00 till - May 2

APRIL 18, 2013

Theatre

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Agora Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Maka Durglishvili; DJ Paata Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/ Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian Dances Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Maia Baratashvili Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Theatre

Griboedov Theatre 2 Rustaveli Ave. Tel: 293-11-06 Thunder Director: Vakhtang Nikolava Cast: Mikhail Arjevanidze, Archil Baratashvili, Irina Meghvinetukhutsesi, Vano Kurasbediani, Sofia Lomjaria, Ana Arutunyan, Oleg Mchedlishvili Duration: 120 minutes Date: April 18 Time: 18:00 Price: 5 GELL

Gallery

The exhibition of Sergo Kenchadze «Transrealism» Tbilisi Museum of History (Karvasla) 8 Sioni Str. Tel: 292-32-27 (Museum is working every day except Monday. From 11:00 till 17:00) till - April 25 The Young Artists Charity Exhibition «New Life» Zurab Tsereteli Museum of Modern Art 27, Rustaveli Ave. till - April 28 Exhibition of Lado Gudiashvili Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18 - 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - April 30 Dimitri Shevardnadze National Gallery invites you at the exhibition «Visions of Mexican Art». D. Shevardnadze National Gallery 11, Rustaveli Ave. Tel: 299-80-22 Gallery’s working hours: Saturday-Sunday 10:00-18:00 till - May 2

APRIL 19, 2013

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Zarebi SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Veriko Turashvili & Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Nata Kurdovanidze; DJ Vako Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/ Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian Dances Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Keti Paresashvili Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Griboedov Theatre 2 Rustaveli Ave. Tel: 293-11-06 Freeloader Director: Nugzar Lortkipanidze Cast: Dimitry Sporishev, Mikhail Arjevanidze, Nino Meladze, Zurab Chipashvili, Medea Mumladze, Oleg Mchedlishvili Date: April 19 Hall: Small Stage Time: 18:00 Price: 5 GEL Gabriadze Theatre 13,Shavteli Str. Tel: 8 790 98-65-91 (MagtiFix), 298-65-90 The Battle of Stalingrad Marionette Theatre Author and Director: Rezo Gabriadze In Russian +10 years Date: April 19 Time: 20:00 Price: 10, 15, 20 GEL

Gallery

The exhibition of Sergo Kenchadze «Transrealism» Tbilisi Museum of History (Karvasla) 8 Sioni Str. Tel: 292-32-27 (Museum is working every day except Monday. From 11:00 till 17:00) till - April 25 The Young Artists Charity Exhibition «New Life» Zurab Tsereteli Museum of Modern Art 27, Rustaveli Ave. till - April 28 Exhibition of Lado Gudiashvili Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18 - 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - April 30 Dimitri Shevardnadze National Gallery invites you at the exhibition «Visions of Mexican Art». D. Shevardnadze National Gallery 11, Rustaveli Ave. Tel: 299-80-22 Gallery’s working hours: Saturday-Sunday 10:00-18:00 till - May 2

Cinema

«Paradjanov»; «The Grand Budapest Hotel»; «Parisian Dream»; «300: Rise of an Empire» 3D (Ticket Price: 7,50 - 12,50 GEL) «Amirani» Cinema 36 Kostava Str. Tel: 299-99-55 «Captain America: The Winter Soldier» 3D; «Rio 2» 3D «Noah» 3D; «The Grand Budapest Hotel»; «300: Rise of an Empire» 3D (Ticket Price: 7,50 - 12,50 GEL)

Cinema

«Rustaveli» Cinema 5 Rustaveli Ave. Tel: 293-22-53, 2 555-000 «Captain America: The Winter Soldier» 3D; «Forgotten King»; «Rio 2» 3D; «Noah» 3D;

APRIL 13, 2013

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Agora Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Maka Durglishvili; Karaoke, DJ Vako Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Live Band Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Cinema

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Agora Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Maka Durglishvili; Karaoke, DJ Vako Plaza Hall Beliashvili and Mikeladze streets territory. Tel: 254 05 56; Mob: 599 56 60 72 Live music, New Voice participant: Giorgi Modzmanashvili, every day different show programs, famous faces, tam tams, dancers (Georgian and ball dances)/ Different programs on Saturday-Sundays Every Friday, inextinguishable star of show business, singer - Gia Suramelashvili Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Live Band Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Theatre

Griboedov Theatre 2 Rustaveli Ave. Tel: 293-11-06 Scarlet Sails Director: Vakhtang Nikolava Cast: Archil Baratashvili, Mikhial Ambrosov, Karina Kenia, Medea Mumladze, Vasili Gabashvili, Leri Gurgenidze Date: April 20 Time: 12:00 Price: 5 GEL

Gallery

The exhibition of Sergo Kenchadze «Transrealism» Tbilisi Museum of History (Karvasla) 8 Sioni Str. Tel: 292-32-27 (Museum is working every day except Monday. From 11:00 till 17:00) till - April 25 The Young Artists Charity Exhibition «New Life» Zurab Tsereteli Museum of Modern Art 27, Rustaveli Ave. till - April 28 Exhibition of Lado Gudiashvili Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18 - 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - April 30 Dimitri Shevardnadze National Gallery invites you at the exhibition «Visions of Mexican Art». D. Shevardnadze National Gallery 11, Rustaveli Ave. Tel: 299-80-22 Gallery’s working hours: Saturday-Sunday 10:00-18:00 till - May 2 For more information, please, visit the following website: www.info-tbilisi.com E-mail: afisha@info-tbilisi.com

HEADLINE NEWS & ANALYSIS

FactCheck

FINANCIAL

14 APRIL, 2014 | FINCHANNEL.COM

Global Trade Unbundled Irakli Gharibashvili: “We intensified the dialogue [on free trade agreement with the US]” Nino TURIASHVILI FactCheck

n his interview given to the Georgian Public Broadcaster on 6 March 2014, Irakli Gharibashvili, Georgian PM stated: “The dialogues with the United States of America were launched during the previous government. We intensified the dialogue and brought about the accomplishment that President Obama himself tells me they need to assist us in enhancing economic and trade relations and carrying out due preparations as one day[free trade] agreement may be reached.” Additionally, in regard to this subject the Prime Minister accused the previous government of “discourtesy” and “diplomatic scandal” towards Georgia’s American colleagues which was spurred by the government’s publicly announcing the signing of the Free Trade Agreement. The given statement was the PM’s response to the voiced criticism of the opposition alleging that the government’s effort and enterprise on the Free Trade Agreement with the US was insufficient. At the meeting with students of Ivane Javakhishvili Tbilisi State University held on 13 March 2014, Irakli Gharibashvili returned to the subject of the free trade agreement dialogues with the US and described the previous government’s position and expectations in this respect as both exaggerated and illusory. FactCheck took interest in the PM’s statement and verified its accuracy. The Free Trade Agreement envisages the opening of new markets for goods and services, eliminating trade barriers and ensuring the protection of intellectual property rights. The high-level dialogue with the US on a free trade agreement took its start on 30 January 2012 following the meeting of Mikheil Saakashvili with Barack Obama. At the meeting the US President asserted: “What we’ve agreed to is a high-level dialogue between our two

countries about how we can continue to strengthen trade relations between us, including the possibility of a free trade agreement...” On his part, Saakashvili thanked President Obama for mentioning “the prospect of a free trade agreement,” saying that it would bolster Georgia’s further progress. The first meeting in the framework of the high-level dialogue took place on 20 April 2012. At the meeting between United States Trade Representative, Ron Kirk, and Georgian Prime Minister, Nikoloz Gilauri, it was decided to form a working group focused upon a free trade agreement between the two countries. On 29 May 2012, another meeting of the USGeorgia high-level dialogue was held betweenDeputy United States Trade Representative, Miriam Sapiro, and Chief Advisor to the Prime Minister of Georgia, Tamar Kovziridze. At the meeting the officials discussed the possibility of a free trade agreement between the two countries. In the course of the first half of 2012, therefore, two high-level dialogues were held between the US and Georgia on the matters of a free trade agreement.

Of note is that United States Trade Representative, Ron Kirk, confirmed the possibility of aUS-Georgia free trade agreement in his later statement as well (See link: page 75). In particular, at the hearing before the United States Senate Committee on Financeexamining the accession of Russia to the World Trade Organisation (WTO),Kirk responded to Senator Orrin Hatch’s question inquiring about the ongoing negotiations with Georgia ona free trade agreement and highlighted the meeting of May 2012 held in the framework of the US-Georgia highlevel dialogue on trade and investment where officials discussed a range of options for increasing bilateral trade and investment, including the possibility of a free trade agreement. Further, the United States Trade Representative expressed his readiness to work together with the Committee to explore concrete ways for pursuing the goals elaborated above. No high-level dialogues were held between the US and Georgia on the matters of a free trade agreement in 2012 (after the Georgian Dream’s taking office) or 2013. This fact was officially confirmed to us by spokespersons of the Ministry of Foreign Affairs of Georgia as well as the Ministry of Economy of Georgia. The high-level meeting on the free trade agreement took place only on 27 February 2014 during the Georgian Prime Minister’s visit to Washington where he met with the United States Trade Representative, Michael Froman. As can be seen from the government’s press release, the officials discussed their mutual interests on bilateral trade and investment growth. It has been established by fact that only one high-level dialogue was held between Georgia and the US in the period from October 2012 to February 2014 (17 months) whereas Georgian and American officials met twice within the framework of the highlevel dialogue in the period from January to October 2012.

The FINANCIAL

lobal trade patterns have changed dramatically in the last two decades. Emerging markets now account for 42% of world exports, up from 19% in 1990, or 52% excluding intra-EU trade. Asia has firmly established itself as the centre of the “made in the world” vertical global supply chain, with China emerging as a megatrader, according to Standard Chartered. Trade is increasingly “unbundled” with countries no longer trading in goods so much as in “tasks”, such as design or assembly. Services trade is expanding faster than goods trade driven by improving communications; it cannot easily be measured at the border and some estimates put services at 40% of total trade now. Historically trade growth has averaged about 1.4 times GDP growth. But since the 2008 peak, world exports have risen only 5%, while nominal GDP has grown more by than10%. Some fear that this slowdown is structural. Trade growth will pick up and this ratio can be restored, according to Standard Chartered. Growth in developed countries is accelerating while manufacturing, still the driver of goods trade, is coming out of the doldrums. Constraints such as lower trade finance availability and rising protectionism are fading. New multilateral trade pacts are in the works. The next leg up in trade is

likely to be fuelled by a further unbundling of the supply chain, by continuing growth and opening in emerging countries and by increasing horizontal trade in both intermediate and finished goods. Emerging markets now account for around half of global trade; most countries have seen a big rise in the share of their trade with EM. From 1990-2012 the share of US trade with EM rose to 46% from 25%, Brazil’s to 57% from 25% and Korea’s to 60% from 16%, according to Standard Chartered. Goods are increasingly “made in the world”, with global supply chains; the import content of exports has risen from 20% of total exports in the 1990s to 40% of total exports currently and is expected to rise to 60% by 2030. Services trade is growing fast and is more important than it looks; trade in services has grown at an average 9.0% since 1990, higher than the 8.0% for goods trade, according to Standard Chartered. The slowdown in trade growth since 2008 is mostly temporary; the ratio was highest in the 1990s - a golden decade for trade fuelled by the creation of the WTO and liberalisation in China and India.

Trade is set to accelerate but patterns will change; China is now a mega-trader - a position last held by colonial Britain, with trade significant not only as a share of world trade (11.5%) but also of its own GDP (47%), according to Standard Chartered. “Trade is unlikely to grow as rapidly as it did in the 1990s or 2000s but we think that concerns about the lack of trade finance and a sudden end to supply chain expansion are overdone; we believe the trade-GDP ratio can regain the 1.3 to 1.5 range longer term,” Madhur Jha, Senior Global Economist at Standard Chartered, said. “South-South trade and services trade are likely to gain importance over the coming years; in the WTO’s “high” scenario, South-South trade balloons to around 43% of total world trade, more than doubling from current levels. China would augment its position as the mega-trader of this century, raising its share from a tenth to about a quarter of total trade,” he said. “Asia remains the centre of inter-regional trade and we expect it to maintain its importance in world trade over the coming years, with the fastest growing trade routes likely to remain centred on Asia,” he added.

CONCLUSION Irakli Gharibashvili justly notes in his statement that the dialogue on a free trade agreement was launched during the previous government. However, the PM also claims to have intensified the dialogue during his government which is not confirmed by fact. Specifically, in the aftermath of 1 October 2012 in the framework of the high-level dialogue on the free trade agreement, Georgian and US officials met only once. It is also of note that along with Georgian politicians, the United States President and other representatives of the US administration were publicly pointing to the prospects of a free trade agreement between the US and Georgia. Consequently, Irakli Gharibashvili’s statement: “We intensified the dialogue [on free trade agreement with the US],” is FALSE.

FALSE

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FINANCIAL HEADLINE NEWS & ANALYSIS

FactCheck

FINCHANNEL.COM | 14 APRIL, 2014

Banks’ Credit Portfolio in Georgia Will Exceed GEL 12 Billion in 2014, Zurab Gvasalia Continued from p. 12

eign capital from the Georgian banking sector which would damage the Georgian economy as a result. Today this problem has already been solved so I do not think that there are any significant legislative changes that are hampering the Georgian banking sector’s development. Q. What new products have been offered to customers by banks in Georgia and how diverse are these products? A. The banks have significantly reduced loan processing and issuing time. Today, it is possible to issue a business loan within 45 minutes. Over the last year, banks offered customers business and consumer portability of loans with updated conditions. The banks have updated the versions of internet banks through the addition of new functions and they have also updated SMS services. TBC Bank created the first internet banking application for the iPad in Georgia at the beginning of 2014. Through iPad Bank clients can manage their finances, transfer money and get access to a range of information. Like Mobile Bank it offers the most innovative way to manage your money on the go. Last year, Bank of Georgia introduced a totally new internet bank for business, Business Online, which is completely tailored to the needs of individual businesses. It has brand new and unique functions for legal entities, it is very fast, best protected, and meets European standards. 7 steps that will bring success to SME business in Georgia, consisting of 7 components each of which is aimed at SME development, is being offered by TBC Bank this year, which is another very useful initiative. The financing of educational events by banks is also very helpful. One of the most important events of the year was the joint innovation of TBC Bank and IFC (International Finance Corporation). They launched a free web platform designed to help small and medium enterprises (SMEs) become more competitive and profitable, and boosting economic growth across Georgia. The SME Toolkit, an IFC innovation developed in partnership with IBM, will provide smaller businesses with tools and educational resources that support their operations from start-up to expansion. This web platform is tailored to the local market and provides businesses with practical guidance in areas like accounting, access to finance, and human resources. Thanks to an initiative by the National Bank of Georgia, a new service is now available in the Georgian banking system: the electronic signature. Electronic signature is an alternative to signing paper documents. Based on the model agreed with the National Bank, an electronic signature has the same legal effect as a signature on paper documents, conferring identical rights and obligations on the bank and its clients. Electronic signature is a significant step forward, contributing to both the short-term and the long-term development of the Georgian banking sector. Q. The European Bank for Reconstruction and Development (EBRD) marked an historic milestone in Georgia with the first-ever bond issue by an international financial institution in Georgian Lari. This initiative is aimed to drive forward the development of the local capital market and enable the EBRD to raise local currency in support of its lending programme in Georgia. How will it really help? A. I do think that EBRD’s initiative will contribute to developing the lo-

cal capital market as well as boosting lending in the local currency. Alternative sources for resource replacement as opposed to bank deposits are being created. This will again be very beneficial for the economy based on the principles of competition. Coupons on the EBRD’s inaugural Lari bond are flat to the three-month rate on certificates of deposit issued by the NBG and are eligible for sale and repurchase operations carried out by the bank. At this time, the interest rate for the bonds is 4.3 percent, which will be reviewed once every three months. Q. What is the interest rate on loans at present and is it possible to do business with this rate? A. The existing interest rates on loans are significantly lower compared to those in previous years. This is proven by the international researches, including one which was ordered by the National Bank of Georgia. The goal of the research was to compare the interest rates on loan products of different countries. The research covered the countries of the Balkans, Eastern Europe, the Caucasus and Central Asia. The result is that the interest rates on loan products in Georgia are lower than in Kazakhstan, Serbia, Azerbaijan, Armenia, Poland and more developed Eastern-European countries. This research proved that the banking sector is a reflection of economic development and within the framework of the economy’s further development, the interest rates will decrease much more. In two or three years it might be similar to how it is in the EU and the signing of the Association Agreement will of course support this process. Today, the banks have a special offer not only for the mortgages of business loans, but for consumer loans with very low interest rates, which in some cases start at 7 percent. Q. How serious a problem is it that customers are generally lazy about reading in detail the contracts they sign with banks? Is it the main reason for the disputes that can arise between the two sides? A. Customers’ complaints towards banks are most often precisely due to their not having read the contracts in many cases, rather than because there is something that has been written that is unclear for the customers. Before signing a contract, the Bank always offers customers the chance to read the terms of the contract. In this way, the customer will get all the information they need including the loan repayment schedule and how much to pay. But, unfortunately, the majority of customers just read the contracts superficially or not at all. In recent years banks have significantly improved the level of their customers’ awareness. The National Bank of Georgia has designed a mandatory provision of financial information/ guide for clients. Banks are obliged to explain to customers all of the issues related to the taking out of a loan. I do not deny, however, that there are cases when a credit officer makes a mistake and the customers’ complaints are well-founded, but such cases are very rare.

Irakli Gharibashvili: “If I am not mistaken, according to the surveys published in 2010, Georgia ranked last in Europe by the level of education.” Natalia VAKHTANGASHVILI FactCheck

n 13 March 2014, Prime Minister of Georgia, Irakli Gharibashvili, held a meeting with students of Ivane Javakhishvili Tbilisi State University. After delivering a speech the PM took questions from the audience. One of the questions put forward by the students concerned the problems related to the quality of education in regional secondary schools of Georgia. Responding to the question, the Prime Minister asserted that the Government is developing educational programmes which will be made available to everyone. Gharibashvili further clarified that Georgia was granted a total of 140 million in the framework of the Millennium Challenge Fund which would be employed for the development of the education field; specifically, for the strengthening of higher educational establishments and technical schools of Georgia, including those operating in the regions of the country. The PM also noted: “If I am not mistaken, according to the surveys published in 2010, Georgia ranked last in Europe by the level of education. This is a truly shameful result for us.” FactCheck inquired about the said survey in which Georgia allegedly came last by the level of education among European countries and studied the document. In his statement Irakli Gharibashvili was referring to the survey which was published in 2011 by the OECD (Organisation for Economic Co-operation and Development), entitled PISA (Programme for International Student Assessment). PISA is an international comparative survey of the knowledge and skills in reading, mathematical and scientific literacy for 15-year-olds. As clarified in the research, PISA seeks to measure how well young adults have acquired the knowledge and skills that are required to function as successful members of society. The survey also serves as a certain guide to the governments of the participating countries aiding them to craft the policies which will improve the existing educational outcomes making the system more efficient. PISA is a regular, ongoing series of assessments that are administered in participating countries every three years. The reporting of the findings from # 1 2 ... 35 36 37

Country Finland Estonia Albania Azerbaijan Georgia

PISA focuses on issues such as: How well prepared are young adults to meet the challenges of the future? Can they analyse, reason and communicate their ideas effectively? What skills do they possess that will facilitate their capacity to adapt to rapid societal change? How equitable is the provision of education within a country or across countries?, and so forth. Originally, in 2009, 64 countries participated in the PISA survey whereas later, a further ten states joined in; among those, including Georgia as well. Unlike the original 64, in those ten countries the survey was conducted in 2010, instead of 2009, and its findings were published in the form of a final report in 2011. The PISA survey involved testing just over 46,000 students across the ten participant countries. Georgia’s results in the testing designed to assess the knowledge and skills of 15-yearolds are discussed in more detail below. Reading literacy, which assesses

Survey Outcomes in Europe Scientific Literacy Reading Literacy 554 536 528 501 391 373 373

485 362 374

an individual’s capacity to understand, use, reflect upon and engage with written texts, was measured by 374 points in Georgia, placing the country in the eighth position among the 74 surveyed countries, and in one category with such countries as Qatar, Peru and Panama. In Georgia, only 38% of students are estimated to have a proficiency in reading literacy that is at or above the baseline. Accordingly, the majority of Georgian students does not satisfy the basic requirements. In terms of mathematical literacy, Georgia’s students attained a mean score of 379 ranking the country tenth from the end among the 74 participating countries. This mean score is slightly above the indicators observed in Albania, Tunisia, Indonesia, Qatar, Peru, Panama and several others. In line with the research, only 31% of students are proficient in mathematics at least to the baseline level. It is of note that in Georgia, there was no statistically significant difference in the performance of boys and girls in mathematical literacy. On the scientific literacy scale, Georgian students were given a mean score of 373 which places the country in the fifth position from the end. In agreement with the findings, 34% of students are proficient in science at least to the baseline level. There was a statistically significant gender difference of 19 score points in scientific literacy, favouring girls. A clearer illustration of the PISA survey’s assessment of the reading, mathematical and scientific literacy of Georgian 15-year-olds is presented in the graph below.

Discussing the outcomes of the survey Irakli GhariMathematical Literacy bashvili focused upon the 541 results of the European 512 countries whose scores are given in the table below. 377 431 379

As can be gathered from the table, in line with the survey results, Georgia’s score in reading literacy surpasses only that of Azerbaijan by 12 points. Judging by the assessed mathematical literacy, Georgian youth outstrips solely Albania by two points.

CONCLUSION Our analysis of the subject revealed that the survey which Irakli Gharibashvili discussed during his meeting with the students was published in 2011. The survey was conducted in 74 countries and sought to assess the knowledge and skills of 15-year-olds. Over the course of the research, the skills of these youngsters were assessed in reading, mathematical and scientific literacy. Results show that 62% of Georgian youth do not possess the baseline level of reading literacy, 66% are struggling with scientific skills and 69% – with mathematical skills. Considering these indicators, Georgia occupies one of the lowermost positions among the 74 participating countries. As for the indicators of European countries in particular, which was emphasised in the statement of the PM, Georgia indeed ranks last by the reading literacy of 15-year-olds. Based upon the mathematical skills Georgia outruns Azerbaijan only by 12 points while in scientific skills Georgia surpasses Albania by two points thereby having the worst final result in Europe. Therefore, FactCheck concludes that the Prime Minister’s statement: “If I am not mistaken, according to the surveys published in 2010, Georgia ranked last in Europe by the level of education,” is TRUE.

TRUE The views expressed in this website are those of FactCheck.ge and do not reflect the views of The FINANCIAL or the supporting organisations

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20 Telavi Str. Tel: 277 20 20 Fax: 277 21 20

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Hotel “O. Galogre” The tickets are available at tbilisi international airport freedom square 4 courtyard marriott hotel, 1st floor

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LE MARAIS

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Literary cafe “MONSIEUR JORDAN” V. Gorgasali st.,17 Tel.: 275-02-07

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financial highlights

FINANCIAL

14 APRIL, 2014 | FINCHANNEL.COM

PASHA BANK

JSC Pasha Bank 03/31/13

Bank: Date:

Information about Suprevisory Council, Directorate and Members of Supervisory Council 1 Arif Pashayev 2 Jamal Pashayev 3 Rovshan Allahverdiyev 4 5 Members of Board of Directors 1 Anar Ismayilov 2 Emil Hajiyev 3 Shahin Mammadov 4 5 6 7 8 List of Shareholders owning 5% and more of issued capital, indicating 1 PASHA Bank OJSC 100.00% 2 3 4 5 6 List of bank beneficiaries indicating names of direct or indirect holders of 1 Mr. Arif Pashayev 10.00% 2 Mrs. Arzu Aliyeva 45.00% 3 Mrs. Leyla Aliyeva 45.00%

Bank: JSC Pasha Bank Date: 03/31/13

sheet N1 in lari

Balance Sheet

Reporting Period ASSETS

Cash 2 Due from NBG 3 Due from Banks 4 Dealing Securities 5 Investment Securities 6.1 Loans 6.2 Less: Loan Loss Reserves 6 Net Loans 7 Accrued Interest and Dividends Receivable 8 Other Real Estate Owned & Repossessed Assets 9 Equity Investments 10 Fixed Assets and Intangible Assets 11 Other Assets 12 TOTAL ASSETS 1

GEL

100,205 189,810 34,053,097

Respective period of the previous year Total

106,922 5,328 44,096

10,940

303,361 28,760 34,686,172

156,346

83,490

GEL

207,127 195,138 34,097,193 0 0 0 0 0 10,940 0 0 303,361 28,760 34,842,518

Total

0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0

LIABILITIES 13 14 15 16 17 18 19 20 21 22

Due to Banks Current (Accounts) Deposits Demand Deposits Time Deposits Own Debt Securities Borrowings Accrued Interest and Dividends Payable Other Liabilities Subordinated Debentures Total Liabilities

22,914 22,954

83,490

0 83,530 0 0 0 0 0 22,914 0 106,443

EQUITY CAPITAL 23 24 25 26 27 28 29 30 31

Common Stock Preferred Stock Less: Repurchased Shares Share Premium General Reserves Retained Earnings Asset Revaluation Reserves Total Equty Capital TOTAL LIABILITIES AND EQUITY CAPITAL

35,000,000

(263,925) 34,736,075 34,759,028

83,490

35,000,000 0 0 0 0 (263,925) 0 34,736,075 34,842,518

0 0 0 0 0 0 0 0 0

The figures are unaudited and presented in accordance with the NBG reporting requirements

Perceptions Flow With the Tide The FINANCIAL

here’s an old saying that one bad apple can spoil the whole bunch. While it may not be applicable across all industries in practice, from a perceptual standpoint a single brand’s negative publicity can often have repercussions for its industry competitors as well. Such has been the case with the cruise industry, which has been embattled over the past year by brandspecific crises which appear to have impacted perceptions across many industry mainstays. Following the Carnival Triumph’s struggle to shore in February 2013, perceptual measures suffered - not just for Carnival, but across seven leading cruise brands - and continued to dip through May. A recovery appeared to be un-

derway more recently, with perceptions trending upwards in January 2014. However, norovirus reports aboard several cruise line ships in Feb-

ruary 2014 seem to have effectively stolen the wind from the industry’s collective sails, with consumer perceptions of these top brands now drop-

ping again, according to Harris Interactive Inc. Looking at these seven industry mainstays in aggregate, Quality, Trust and Purchase Intent scores were all still down significantly before the recent norovirus incidents, when compared to the state of these brands prior to the Triumph debacle. With all three measures dropping further still in the wake of the reported outbreaks, this leaves the average perceived Quality score down by 11% vs. its pre Triumph level, with Trust down by 12% and Purchase Intent down by 13%. As with the Triumph incident, the impact of this more recent series of issues has not been limited to the cruise brands involved firsthand with the incidents. All seven brands declined from before to after the norovirus incidents in at least one of the measures, and most were down from pre-

Triumph levels to begin with, according to Harris Interactive Inc. “We’ve all heard the saying that a rising tide lifts all boats,” said Deana Percassi, Vice President and Public Relations Research Consultant with Nielsen, “But the inverse also holds true. In a field as crowded as the cruise industry, bad press for a small handful of brands - or even a single one - can have negative repercussions for major players across the board,” Percassi added.

AIR TRAVEL PERCEPTIONS REMAIN ABOVE SEA LEVEL Americans continue to profess more favorable attitudes toward air travel than toward

cruises, with roughly six in ten (59%) agreeing that air travel is much more reliable than taking cruises and a majority (54%) agreeing that air travel is much safer than taking cruises. A majority of Americans (54%) also agree that they’re less likely to take a cruise now than they were a year ago, with this sentiment proving stronger among those who have never taken a cruise (58%) than among those who have (44%). One-third of Americans (32%) agree that cruises are “worry-free,” with past cruise experience again playing a role in agreement with this perception: those who have taken a cruise (50%) are more than twice as likely to agree that cruises are “worry free” as those who have not (23%), according to Harris Interactive Inc.

UK Ninth Most Entrepreneurial Economy Globally The FINANCIAL

he UK has slipped from sixth to ninth place in the 2014 Global Entrepreneurship and Development Index (GEDI), according to the London School of Economics and Political Science.  The researchers behind the GEDI study suggest that attitudes and entrepreneurial aspirations in the UK are holding back UK entrepreneurial performance. They found that while UK entrepreneurial activity is innovative and enjoys strong cultural support, its full potential may be held back by negative attitudes and a lack of ambition, relative to leading entrepreneurial economies.  The researchers found that the overall UK performance in entrepreneurship is world class. However, the different elements making up

entrepreneurship in the UK – such as ability, attitudes and ambition – are not as well balanced as in the very leading entrepreneurial economies such as the US, which ranked first in the Index, and Australia, which ranked second. “The UK ranks a solid 9th in the world and 6th in europe on the 2014 GEDI. This strong performance is supported by a competitive environment, a high level of human capital and a strong tech sector. The UK ranks higher on entrepreneurship then on global competitiveness or economic freedom globally. While it does better on gender equality then the european average it could do much better in this area. Most of this could be improved by increasing spending on entrepreneurship education,” said Professor Zoltan Acs, LSE Professor of Practice in Entrepreneurial Development and co-author of the study.

In the study of the UK and 119 other countries across the world, the team analysed data from more than 3,000 highly skilled individuals with business ideas, alongside data describing how well each country supports entrepreneurial activity. The researchers found that while entrepreneurial activity is innovative in the UK, Britons were less likely to choose entrepreneurship as a career path because they had a wealth of employment options available to them. This made them reluctant to leave secure, well paid jobs for the uncertainty of starting up a business, according to LSE. This is in comparison to countries such as the US and Australia, where highly skilled individuals with innovative ideas are more likely to set up businesses despite the risks. In these countries, innovative entrepreneurs also show ambition to grow their businesses and they are supported by

more positive attitudes than in the UK. The high valuation of entrepreneurship means that highly skilled individuals are more likely to set up growthoriented, high-quality businesses. The researchers say this type of ‘can-do’ environment provides a platform for aspiring entrepreneurs to develop a bigger network of contacts who can provide support, in the form of advice or even financial backing.  The study was carried out by researchers from Imperial College Business School in association with George Mason University, the London School of Economics and Political Science and the University of Pécs. “Although the UK is a worldleading entrepreneurial economy, our study shows that a relative lack of ambition and positive attitudes may hold the UK back from realising its full entrepreneurial potential,” said Professor Erkko Autio, co-author of the study from

Imperial College Business School. “Enterprising people who are highly skilled should be encouraged to see setting up their own business as an exciting alternative to full-time employment. However, our report shows that many still crave the security of full-time employment,” Autio said.  “Entrepreneurship creates social benefits that extend beyond the individual, such as job creation, increasing competition and enhanced economic dynamism. Our report pinpoints areas that the government can focus on to help aspiring entrepreneurs make the leap from the safety of a well-paid job into what they may feel is riskier territory,” Autio added.  This year’s GEDI index, now in its fourth edition, identifies the strengths and weaknesses of the economies of 120 countries and compares their entrepreneurial characteristics. The Index compared the experience of male and fe-

male entrepreneurs for the first time, to reflect the increasing participation and importance of women in entrepreneurship around the world.  The researchers found that the UK has fewer female entrepreneurs, relative to males, than many other countries such as Germany, the USA and Australia. They suggest that increasing female entrepreneurship could improve the UK’s performance, according to LSE.  The researchers also found that UK entrepreneurs are strong in innovation. The UK ranks first in Europe and third overall, for its level of startup activity in the medium and high technology sectors. In recent years, the Government has been fostering technology clusters such as ‘silicon roundabout’ in Shoreditch, London. These clusters have given entrepreneurs access to high quality training and development to help them grow their businesses.

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FINANCIAL HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 14 APRIL, 2014

SANCHO

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Hangar Bar

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Belle Ville

BUFFALO BILL

French - European barrestaurant Pleasant and cozy atmosphere High quality service, live music every day 26, l.Kiacheli Str. Tel: 293 65 53

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