Q1 results presentationbgeo.com/uploads/presentations/1155.pdfMay 2010 Page 4 Q1 2010 P&L results...

May 2010

GROWTH AT THE RIGHT PRICELSE: BGEO / GSE:GEB

JSC Bank of Georgia Q1 2010 results overview

May 2010

Introduction to Bank of Georgia

Investment highlightsUndisputed leader of Georgian financial services industry with market-leading retail and corporate banking franchiseStrongly positioned to benefit from US$4.5 bln international assistance package pledged to Georgia by international donors in the aftermath of Russia-Georgia conflict in August 2008Disciplined capital management, low leverage, conservative liquidity position, no exposure to sub-primeSophisticated management team with Western banking & finance backgroundTransparency and good governance, over 89% institutionally owned. Supervisory Board includes two large institutional shareholders and two independent directors

The leading universal bank in Georgia

Leading corporate bank with approximately 85,500 legal entities and over 157,600 current accountsLeading card-processing, leasing, insurance, wealth management and asset management services providerThe only Georgian entity with credit ratings from all three global rating agencies

S&P: ‘B/B’ – at the sovereign ceilingFitch Ratings: ‘B/B’Moody’s: ‘B3/NP (FC)’ & ‘Ba3/NP (LC)’

Listed on the London Stock Exchange (GDRs) and Georgian Stock ExchangeMarket Cap (LSE) US$ 313 mln as of 25 February 2010Approximately 95% free float

Issue of the first ever Eurobonds in GeorgiaBloomberg: BKGEO; 5 year, 9%, US$200 mlnB/Ba2/B (composite B+)

No.1 by assets (34.3%), (1) gross loans (32.7%), (1) client deposits (29.9%) (1) and equity (39.3%) (1)

Leading retail banking, with top brand, best distribution network and broadest range of services of any bank in Georgia

420382379ATMs

142141140Branches

645,000+537,000+570,000+Cards Outstanding

875,000+999,000+996,000+Retail Accounts

200920092010

MarchDecemberMarch

(1) All data according to the NBG as of 31 March 2009

May 2010

JSC Bank of Georgia Q1 2010 results overview

May 2010

Q1 2010 P&L results highlights

16.4%19.7%17.7%Tier I Capital Adequacy Ratio (NBG)17.4%16.8%15.9%Total Capital Adequacy Ratio (NBG)

Q1 2009Millions unless otherwise noted Q1 2010 Q4 2009 Growth Growth 1

Bank of Georgia (Consolidated, IFRS Based) GEL US$ GEL US$ Q-O-Q GEL US$ Y-O-Y(Unaudited) (Unaudited) (Unaudited)

Net Interest Income 45.3 25.9 46.0 27.3 -1.7% 52.4 31.4 -13.7%Net Non-Interest Income 30.6 17.5 31.3 18.6 -2.2% 29.3 17.5 4.6%Total Operating Income (Revenue)2 75.9 43.4 77.4 45.9 -1.9% 81.7 48.9 -7.1%Recurring Operating Costs 46.3 26.4 46.6 27.6 -0.7% 44.6 26.7 3.6%Normalized Net Operating Income3 29.6 16.9 30.8 18.3 -3.7% 37.1 22.2 -20.1%Net Non-Recurring Income (Costs) (3.3) (1.9) (106.8) (63.4) NMF (0.2) (0.1) NMFProfit Before Provisions 26.4 15.1 (76.1) (45.1) NMF 36.8 22.1 -28.5%Net Provision Expense 7.4 4.2 30.3 18.0 -75.7% 32.1 19.2 -77.0%Net Income/ (Loss) 16.8 9.6 (102.3) (60.7) NMF 5.1 3.0 229.8%Tier I Capital Adequacy Ratio (BIS) 22.1% 22.4% 22.2%Total Capital Adequacy Ratio (BIS) 32.3% 33.8% 31.7%

1 Compared to the same period in 2008; growth calculations based on GEL values.2 Revenue includes Net Interest Income and Net Non-Interest Income.3 Normalized for Net Non-Recurring Costs.

May 2010

31 March 2010 Balance Sheet results highlights

13.6 22.8 11.3 19.1 11.2 19.5 Book Value Per Share, GEL & US$

426.3 711.8 355.0 598.4 349.6 611.7 Shareholders’ Equity

1,482.0 2,474.9 1,373.2 2,315.0 1,436.2 2,512.4 Total Liabilities

696.3 1,162.8 541.8 913.3 521.3 912.0 Borrowed Funds

710.1 1,185.9 768.1 1,294.9 841.8 1,472.7 Total Deposits

1,908.2 3,186.8 1,728.2 2,913.4 1,785.8 3,124.1 Total Assets

1,144.7 1,911.6 995.5 1,678.2 1,015.9 1,777.3 Net Loans

(Unaudited)(Unaudited)

US$GELUS$GELUS$GELBank of Georgia (Consolidated, IFRS Based)

Q1 2009YE 2009Q1 2010Millions, unless otherwise noted

-14.2%2.2%Book Value Per Share,

-14.1%2.2%Shareholders’ Equity

1.5%8.5%Total Liabilities

-21.6%-0.1%Borrowed Funds

24.2%13.7%Total Deposits

-2.0%7.2%Total Assets

-7.0%5.9%Net Loans

Q1 10/Q1 09Q1 10/YE 09

ChangeChange

May 2010

Composition of revenue in Q1 2010Revenue by segments, Q1 2010Composition of Revenue, Q1 2010

Consolidated

Total Revenue: GEL 75.9 million in Q1 2009

Net interest income 59.6%,GEL 45.3 mln (-1.7% q-o-q)

Net income from documentary

operations 2.9%,GEL 2.2 mln

(-5.5% q-o-q)

Net foreign currency re lated

income 9.7%,GEL 7.3 mln

+29.5% q-o-q)Net fee and commision

income13.6%,GEL 10.3 mln

(-18.2% q-o-q)

Net other non-interest income

14.2%,GEL 10.8 mln(+0.6% q-o-q)

Other5.6%,

GEL4.2 mln(+179.1% y-o-

y )

Aldagi BCI 6.0%,

GEL4.5 mln(+32.5% y-o-y)

Belarus 3.8%,

GEL2.9 mln(+20.0% y-o-y)

Ukraine 4.0%,

GEL3.1 mln(-44.0% y-o-y) BoG

Standalone 80.6%,

GEL61.2 mln(-11.2% y-o-y)

May 2010

Analysis of revenue

Net fee & commission income & Income from documentary operations

Net foreign currency related incomeRevenue growth

Other non-interest income

Consolidated

9.48.8

7.16.5

5.7

7.3

4.3

6.1 6.2

10.1

13.2

10.4

14.9

0

2

4

6

8

10

12

14

16

Q12007

Q22007

Q32007

Q42007

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

GEL mln

5.9 5.66.9 7.6

10.2 10.2

12.910.9 11.1 11.6 12.0 12.6

10.30.7 1.3

1.81.9

1.4 1.9

1.7

1.42.3 1.8

2.32.3

2.2

0

2

4

6

8

10

12

14

16

Q12007

Q22007

Q32007

Q42007

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

GEL mln

Net Fee & Commission Income Net Income From Documentary Operations

26.0 30.9 33.542.8 49.8 55.8 58.9 56.4 52.4 49.5 48.9 46.0 45.3

15.021.3 22.7

25.3

31.330.3 27.1 30.2

29.3 31.1 30.4 31.3 30.6

0

10

20

30

40

50

60

70

80

90

100

Q12007

Q22007

Q32007

Q42007

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

GEL mln

Net Interest Income Net Non-Interest Income

41.0

81.786.685.986.181.1

68.1

56.252.2

77.4 75.980.6 79.3

1.4 2.1

-0.11.6 1.7 2.5 3.2 3.0

5.1 4.93.7 4.2

1.4

1.0

1.3 1.60.4 0.3

1.91.6

2.2

0.6 0.2

0.2

3.0

2.4

-0.4 -0.4 -1.1

-3.4

-0.5

0.63.3 1.9

2.63.3

4.7

1.4

1.03.6

3.7 3.0 4.4 4.4

2.1

1.9

0.1

1.3

0.51.0

0.2

0.1

1.8

0.2

0.3 0.6

-0.1

0.3

0.11.0

-6

-4

-2

0

2

4

6

8

10

12

Q12007

Q22007

Q32007

Q42007

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

GEL mln

Net Insurance Income Brokerage Income Asset Management Income Realized Net Investment Gains Other

May 2010

Analysis of recurring operating costsRecurring operating cost structure by segments,

Q1 2010Recurring operating cost structure, Q1 2010

Consolidated

Total recurring operating costs: GEL 46.3 million in Q1 2010 (-0.7% q-o-q), (+3.6% y-o-y)

O ther operating costs 6.3%

GEL 2.9 mln(-0.1% q-o-q)

Procurment & operations support

costs 7.6%,GEL 3.5 mln

(-8.0% q-o-q)

Depreciation & amortization 14.4%,

GEL 6.7 mln(-3.8% q-o-q )

Sell ing, general & administrative costs

21.2%,GEL 9.8 mln

(-6.4% q-o-q)

Personnel costs 50.5%,

GEL 23.4 mln(+4.0% q-o-q)

O ther, 14.7%GEL 6.8 mln

(+120.8% q-o-q)

Aldagi BCI, 6.4%

GEL 2.9 mln(-18.9% q-o- q)

BNB, 3.8%GEL 1.8 mln

(-10.4% q-o-q )

BG Bank, 8.6%GEL 4.0 mln

(-6.4% q-o-q)

BoG standalone,

66.5%GEL 30.8 mln(-8.6% q-o-q)

May 2010

Analysis of recurring operating costs cont’d

Cost/Income ratio

Personnel costsEmployees

Normalized net operating income, Profit before provisions

Consolidated

17.8

25.727.3

23.122.0

23.2 22.3 22.5 23.4

28.4

0

5

10

15

20

25

30

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

30.8 29.636.8 32.434.336.6 37.1 36.3 38.7 37.1 34.3

26.434.0

45.140.5

33.7

8.7

(76.1)-80

-60

-40

-20

0

20

40

60

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

Normalised Net Opearting Income Profit Before Provisions

53.4% 49.9%55.5%

90.0%

201.8%

53.9%

140.5%

60.8%52.9%

57.8% 59.1%53.0%

44.4%42.2%

65.3%

60.7%

50.0%41.0%50.8%

42.2%

45.1%56.6%49.6%46.8%50.1% 50.5%

58.0%

74.7%

35.7%

76.0%

116.9%

68.0%

100.1%109.2%91.5%

145.2%

59.1% 55.6% 64.5% 80.4% 84.6%61.5%66.6% 60.6%

89.4%

62.8%

0%

40%

80%

120%

160%

200%

240%

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

Cost/Income Ratio, ConsolidatedCost Income Ratio, Bank of Georgia StandaloneCost/Income Ratio, BG BankCost/Income Ratio, BNB

2,692

3,056

3,619

3,853

2,741

2,692

2,665

2,669

2,674

2,825

821

824

836

842

786

757

707

617

621

3925,048

4,781

4,798

4,914

4,964

4,977

6,196

5,911

4,926

4,459

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000

Q4 2007

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Group Consolidated BoG Standalone BG Bank

May 2010

NIM & loan yields

CB loan yield (annualized)(Excluding provisions)

RB & WM loan yield (annualized) (Excluding provisions)

Net Interest Margin (annualized)

Blended loan yield (annualized)*(Excluding provisions)

Consolidated

* Based on consolidated data, including Corporate Center where all loan recoveries are allocated

13.5%14.4% 14.5% 14.0% 14.4%

15.0%15.6% 15.2%

15.9%14.9%

19.1%

14.8% 15.2%

10%

16%

22%

28%

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

22.2%20.9%

19.8% 19.9% 20.3%19.7% 19.2%

19.9% 20.1% 19.8% 19.3%20.5%

19.6%

10%

16%

22%

28%

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

12.4%

7.8%9.1%

17.2%

15.1%

8.0%8.5%

9.1%

9.0% 9.1%9.3%

10.1%9.8%8.9%

8.1%

10.2%9.6%

5.6%6.2%

8.9%7.7%7.1%6.5%

8.1%9.6%10.0% 9.3%

9.9%9.8%

9.0%8.6%7.5%

10.6%

9.3%9.5%

13.0%11.7%

10.5%

8.4%

13.4%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

Net Interest Margin, Group Consolidated Net Interest Margin, BG Bank

Net Interest Margin, BoG Standalone Net Interest Margin, BNB

24.8% 24.7% 24.3%

21.6% 22.2% 21.8%20.6% 20.4% 20.1% 20.5%

23.7%22.3%

23.2%

10%

16%

22%

28%

34%

40%

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

May 2010

Composition of assets as at 31 March 2010Consolidated

GEL million YE 2008 31-March-09 31-Dec-09 31-March-10Available-For-Sale & Trading Securities 33.7 40.5 21.7 17.8 Treasuries And Equivalents 8.3 38.3 249.2 249.2 Other Fixed Income Instruments 14.6 0.0 - -Insurance Related Assets 42.0 52.6 26.7 32.6 Investments In Other Business Entities & Investment Property 64.0 36.5 89.2 103.2 Intangible Assets Owned & Goodwill 152.5 146.7 85.4 91.0 Tax Assets, Current And Deferred 12.8 6.7 23.5 23.8 Prepayments And Other Assets 51.4 27.9 36.6 52.6 Other Assets 379.4 349.3 532.3 570.2

Note: Net loans include Net finance lease receivables

570.2532.3349.3379.4

280.4

339.9301.8

1,777.31,678.21,911.6

2,080.6

322.2

265.5

414.999.6

177.9

157.0

171.1397.6

276.5

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1 2010Q4 2009Q1 2009YE 2008

Cash & Equivalents

Loans & Advances To CreditInstitutions

Net Loans

Property & Equipment

Other Assets

GEL mln

5.4%of total assets

57.6% of total assets







10.7% of total







3,1872,913

3,259

3,124






May 2010

Composition of gross loan book as at 31 March 2010Consolidated

Georgia: RB & WM, CB

Ukraine: BG Bank

Belarus: BNB

Numbers do not include CC/Eliminations

Gross loan book Q1 2010: GEL 1,957.3 million

CB, 821 CB, 796 CB, 795 CB, 760 CB, 811 CB, 869

RB & WM, 895 RB & WM, 867

BG Bank, 255

BG Bank, 265 BG Bank, 257

BG Bank, 194

BG Bank, 199

BG Bank, 190 BG Bank, 186

BG Bank, 184

BNB, 35

BNB, 36

BNB, 30

BNB, 27 BNB, 26 BNB, 24

BNB, 32

CB, 881 CB, 958 CB, 857

RB & WM, 790 RB & WM, 965 RB & WM, 976 RB & WM, 1,050 RB & WM, 974 RB & WM, 854 RB & WM, 887

BG Bank, 177

0

500

1,000

1,500

2,000

2,500

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

12% of gross loans

47% of gross loans

39% of gross loans

1 3% of gross loans

46% of gross loans

42% of gross loans

14% of gross loans

4 3% of gross loans

44% of grossloans

2% of gross 2% of gross loans

9% of gross loans

48% of gross loans

42% of gross loans

10% of gross loans

48% of gross loans

44% of gross loans

1% of gross loans

42% of gross loans

47% of gross loans

10% of gross loans

1% of gross loans

41% of gross loans

47% of gross loans

10% of gross loans

1% of gross loans

44% of gross loans

46% of gross loans

1% of gross loans

10% of gross loans

44% of gross loans

45% of gross loans

9% of gross loans

2% of gross loans

May 2010

Securities portfolio as at 31 March 2010Breakdown of securities investmentsBreakdown of securities portfolio,

31 March 2010

Consolidated

Total securities portfolio: GEL 17.8 million

Local Debt, 36%

Equities, 64%

17,750 11,353 6,397 Total

---Other

---BNB (Belarus)

6,397 -6,397 BG Bank (Ukraine)

1,145 1,145 -SBRE

3,329 3,329 -Liberty Consumer

4,316 4,316 -Aldagi BCI

2,563 2,563 -BG Capital

TotalEquityDebtGEL '000s

May 2010

Liabilities breakdown as at 31 March 2010Consolidated

YE 2008 31-March-09 31-Dec-09 31-March-10Issued Fixed Income Securities - 0.1 0.7 -Insurance Related Liabilities 55.4 63.8 34.2 42.7Tax Liabilities, Current And Deferred 24.4 19.0 25.2 27.3Accruals And Other Liabilities 50.4 43.3 46.6 57.8Other liabilities 130.2 126.2 106.8 127.8

Total liabilities 31 March 2010: GEL 2,512.4 million

78.222.552.979.0

1,394.41,272.51,132.91,193.1

912.0

913.31,162.81,137.8

127.8

106.8126.2130.2

611.7

598.4

711.8718.8

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1 2010Q4 2009Q1 2009YE 2008

GEL mlnTotal equity

Other Liabilites

Borrowed Funds

Client Deposits

Deposits And Loans From Banks

22% of total liabilities + equity















3,124

2,913

3,1873,259






May 2010

Client deposits breakdownConsolidated

Client deposits Q1 2010: GEL 1,394.4 millionNote: RB & WM client deposits include deposits at BG Capital

Georgia: RB & WM, CB

Ukraine: BG Bank

Belarus: BNB

Numbers do not include CC/Eliminations

CB , 629 CB , 606 CB , 521

CB , 595 CB , 588

BG Bank, 216

BG Bank, 180

BG Bank, 121

BG Bank, 115

BG Bank, 117

BG Bank, 139

BG Bank, 122

BNB , 16

BNB , 20

CB , 652 CB , 681 CB , 576 CB , 656

RB & WM, 458 RB & WM, 534 RB & WM, 396 RB & WM, 416 RB & WM, 374 RB & WM, 389 RB & WM, 463 RB & WM, 539 RB & WM, 595

BG Bank, 171

BG Bank, 127 BNB , 27

BNB , 31

BNB , 25

BNB , 18

BNB , 12

0

200

400

600

800

1,000

1,200

1,400

1,600

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

CB RB & WM BG Bank BNB

34% of client deposits









1,326

1,395

1,202 1,193

1,133



1,025

1,183


1,272







1,394

May 2010

Capital adequacy & wholesale funding

May 2010

Capital adequacy

Risk-weighted assets BIS vs. NBG

NBG capital adequacy ratios, BoG standaloneBIS capital adequacy ratios, BoG consolidated

Net loans/deposits & loans/(deposits+equity), BoG consolidated

25.2% 25.0% 23.9% 22.4% 22.1%25.4%

22.2%22.5%24.7%

34.6%34.2%31.7%

27.3%25.3%

25.8%25.8%

33.8% 32.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

Tier I Capital Adequacy Ratio Total Capital Adequacy Ratio

18.3%15.8%

18.2%16.6% 16.4%

17.8%20.4% 19.7%

17.7%

16.3% 16.8% 15.9%15.1% 15.5% 13.5% 17.4% 18.4% 21.2%

0%

5%

10%

15%

20%

25%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010


161.2% 164.1%

135.4% 129.6%120.7%

88.6% 85.3%

132.6% 135.7%145.7%

163.6%

85.8% 89.5% 93.5%104.5% 100.7% 98.5%

85.3%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

Net Loans/Total Deposits Net Loans/(Total Deposits+Equity)

2,7682,559 2,549 2,451

2,597

3,4583,302

3,0412,870

1,031

2,593 2,7342,516

2,920

1,724

3,100

3,605

3,1322,720

2,717

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Q1 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

BIS NBG

May 2010

International borrowings

International borrowings repayment schedule

International borrowings - fixed vs. floating rates, 31 March 2010

Selected international loans

International borrowings by currencies, 31 March 2010

Note: Depicts final maturity dates Excluding credit lines as part of documentary business

Euro, 0.2%

US$, 99.8%

Fixed Interest Rate, 82%

Floating Interest Rate, 18%

Key LendersPrinciple Amount Outstanding

as of March 31, 2010 MaturitySyndicated Loan arranged by Citi and ADB, 3rd Tranche US$ 8.3 million 2010Eurobonds US$ 200.0 million 2012Senior Term Loan from FMO US$ 9.1 million 2014Senior Term Loan from WorldBusiness Capital US$ 6.4 million 2016Subordinated Loan from HBK Investments (Call in 2012) US$ 15.0 million 2017Subordinated Loan from Merrill Lynch (Call in 2012) US$ 35.0 million 2017Senior Term Loan from WorldBusiness Capital (GLC) US$ 4.6 million 2017Subordinated loan from FMO and DEG (Call in 2013) US$ 30.0 million 2018Senior Loan from OPIC US$ 28.2 million 2018Subordinated Loan from OPIC US$ 10.0 million 2018Senior Term Loan from IFC US$ 50.0 million 2013Senior Term Loan from EBRD US$ 50.0 million 2014Subordinated Loan from IFC US$ 24.0 million 2019Subordinated Loan from EBRD US$ 24.0 million 2019Convertible Loan from IFC US$ 26.0 million 2019Convertible Loan from EBRD US$ 26.0 million 2019Other, USD denominated US$ 4.8 million NMF

Other, EUR denominated EUR 0.9 million NMF

Total US$ 552.6 million

31,982 68,376

504,289

119,373

23,140 8,732 5,905 23,162

174,940

6,7781.1%

2.3%

16.6%

3.9%

5.8%

0.8%

0.2%0.2%0.3%

0.8%

0.0

100,000.0

200,000.0

300,000.0

400,000.0

500,000.0

600,000.0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

GEL '000s

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

Principle Amounts Outstanding as of March 31, 2010 (LHS) As % of March 31, 2010 Assets (RHS)

May 2010

Business overview

May 2010

Group structure

Page 20

BoG Group

Rep

ortin

g L

ines

* Formerly Galt & Taggart SecuritiesNote: Following the sale of GTAM, its asset management arm, BoG owns approximately 65% of Liberty Consumer, and 100% of SBRE. Both Liberty Consumer and SBRE are fully consolidated in BoG financials

Securities Insurance

Aldagi BCIBG Capital *Bank of Georgia BGB BNB

May 2010

BoG standalone results overview

May 2010

BoG standalone performance

Net income

Recurring operating cost structure, Q1 2009Revenue performance

Cost/Income Ratio

Standalone

45.3 50.1 52.2 51.1 50.4 45.5 44.5 44.8 42.6

21.321.0 19.2 18.5 16.3

16.8 17.0 17.5 16.8

0

10

20

30

40

50

60

70

80

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

Net Interest Income Net Non-Interest Income

66.671.1 71.4 69.9

66.762.3 61.5 62.3

59.4

Personnel costs, 50.3%

GEL 15.5 mln(-0.8% q-o-q)

Selling, general & administrative

expenses, 19.7%GEL 6.1 mln

(-23.8% q-o-q)

Depreciation & amortization,

17.9%GEL 5.5 mln

(-11.0% q-o-q)

Procurement & operations support

expenses, 9.3%GEL 2.8 mln

(-0.3% q-o-q)

Other operating expenses, 2.9%

GEL 0.9 mln(-17.7% q-o-q)

25.4 28.4

-58.0

28.8

11.3

0.9

10.8 7.812.8

-70

-60

-50

-40

-30

-20

-10

0

10

20

30

40

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 21010

GEL mln

60.7%

53.9%

45.1%

41.0%

50.0% 50.8%50.5%

42.2%

58.0%

44.5%

44.7%

47.3%43.1% 41.4%

47.7% 48.9%54.0% 51.8%

0%

10%

20%

30%

40%

50%

60%

70%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010Cost/income, Bank of Georgia standalone

Normalized Cost/Income, Bank of Gerorgia standalone

May 2010

Composition of assets as at 31 March 2010Standalone

GEL million YE 2008 Q1 09 YE 09 Q1 10

Treasuries And Equivalents 8 38 249 249

Other Fixed Income Instruments 15 - - -

Investments In Other Business Entities, Net 295 315 334 356

Intangible Assets Owned, Net 13 7 14 17

Goodwill 23 23 23 23

Tax Assets, Current And Deferred 7 - 7 6

Prepayments And Other Assets 31 15 26 24

Other assets 392 398 653 675

675653398392

216226

231232

1,7001,606

1,7501,885

258165324

249

184214229

192

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1 2010Q4 2009Q1 2009YE 2008

GEL mln

Cash & Equivalents

Loans & Advances To CreditInstitutions

Net Loans


Other Assets

7% of total assets

6% of total assets

57% of total assets

8% of total assets

23% of total assets

3,0332,987

8% of total assets

8% of total assets

63% of total assets

8% of total assets

13% of total assets

2,8427% of total assets

11% of total assets

60% of total assets

8% of total assets

14% of total assets

2,916

22% of total assets

56% of total assets

9% of total assets

7% of total assets

6% of total assets

May 2010

Analysis of the loan bookStandalone

* Other loans include car, POS and legacy retail loans

Credit cards and overdrafts, 16%

Micro loans, 14%

Mortgage loans, 43%

Consumer and other, 27%

FMCG, 15%

Energy, 9%

Industry & State, 17%

Construction & Real Estate, 19%

Other, 6%

Pharmaceuticals and Healthcare,

2%

Trade, 32%

40.6

951

846.6

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Q1 2010

GEL mln

CB

RB

WM

1,838.2

May 2010

Analysis of the loan book

Loans by maturity, 31 March 2010

Loan concentrationLoans by currency, 31 March 2010

Loan book collateralization

Standalone

3% 2% 4%

22%

69%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Less than 1month

1 to 3 months 3 to 6 months 6 to 12 months Over 1 year

10.7%

13.8%

16.6%

19.6%

0%

5%

10%

15%

20%

25%

Q1 2009 Q1 2010

Top 10 Borrowers Top 20 Borrowers

25.1% 24.0% 24.5%

74.9% 76.0% 75.5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

RB & WM CB TotalGEL Foreign Currency

86.2% 87.7%

0%

20%

40%

60%

80%

100%

Q1 2009 Q1 2010

May 2010

Provisioning policy

Reserve for loan losses to gross loans

NPL coverage ratioNPLs & write-offs, 31 March 2010

Impairment seasoning, Q1 2010

Standalone

3.77% 3.68%

7.44%

0.75%

0.06% 0.69%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

CB RB & WM Total

NPLs as % of Gross Loans Write-offs as % of Gross Loans

208.4%

554.4%

96.7%117.4%152.6%

524.0%

117.6%166.8%

106.5% 115.2% 100.7%

104.2%129.3%169.1%

138.3%

124.2% 124.1% 106.6%

0%

100%

200%

300%

400%

500%

600%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

BoG Standalone BoG Consolidated

9.2%

2.1% 2.1%

6.3% 5.0%

6.6%

8.1%

9.5% 9.4%

7.5%

1.9% 2.0%

6.8%4.9%

5.5%6.7%

7.5% 7.4%

6.4%

1.5%

1.7%

1.5%

19.8%

2.0%

6.6%8.3%

6.7%

16.9%

1.7%

22.8%

-1.0%

5.6% 6.6%2.0%

4.3%2.8%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010-5%

0%

5%

10%

15%

20%

25%

Reserve for loan losses to Gross loans, BoG ConsolidatedReserve for loan losses to Gross loans, BoG StandaloneCost of risk, BoG Consolidated, annualisedCost of risk, BoG Standalone, annualised

2.5% 2.6% 2.4%3.0%

3.5% 3.8%3.2%

2.0%1.7%

1.2% 1.3% 1.1%0.3%

1.2%

0.7%

1.3%1.4%

2.9%

1.2%1.1% 2.0%

1.6%

432.6

491.3

179.8

439.3

356.7292.4 327.6 300.9

548.3

632.3604.0

200.9

239.1

0%

1%

2%

3%

4%

5%

6%

7%

8%

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 20100.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0GEL mln

Write-Offs as % of Loans Issued (LHS) NPLs as % of Loans Issued (LHS) Loans Issued (RHS)

May 2010

Provisioning policy cont’d – BoG standalone

RB & WM loan loss reserve breakdown by loan type, 31 March 2010

NPLs, 31 March 2010Loan loss reserve, 31 March 2010

CB loan loss reserve breakdown by loan type, 31 March 2010

Standalone

Mortgage loans, 25.6%

GEL (19.6 mln)

Consumer and other, 15.9%

GEL (12.2 mln)

Credit cards and overdrafts,

54.2%GEL (41.6 mln)

Micro loans, 4.3%

GEL (3.4 mln)

8.7 8.1 9.7 12.0 20.046.3

67.454.5

35.9

67.6

16.6 10.922.4 11.3

36.6

41.1

51.361.4

75.4

69.2

1.7%1.2%

1.7%1.3%

3.2%

4.7%

6.9% 7.0%6.4%

7.4%

0

20

40

60

80

100

120

140

160

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

0%

1%

2%

3%

4%

5%

6%

7%

8%

RB &WM CB % of Gross loans

16.5 14.5 22.2 29.849.8 57.7

75.5 67.9 70.9 76.7

11.4 16.310.8

83.6

36.442.2

56.856.0

45.038.2

2.0% 1.9% 2.0%

4.9%5.5%

7.5% 7.4% 7.5%

6.7%6.8%

0

20

40

60

80

100

120

140

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

0%

1%

2%

3%

4%

5%

6%

7%

8%

RB & WM CB Loan loss reserve as % of gross loans

Other, 4.0%GEL (2.1 mln)

Pharmaceuticals & Healthcare,

0.2%GEL (0.1 mln)

Industry & State 3.7%

GEL (2.1 mln)

Construction & Real Estate

29.9%GEL (16.7 mln)

Fast Moving Consumer

Goods, 13.2%GEL (7.4 mln )

Energy, 11.5%GEL (6.4 mln)

Trade, 37.5%GEL (21.0 mln)

May 2010

BoG standalone liabilitiesLeverage ratio, BoG standalone

Liquidity ratio, BoG standalone

Standalone

Leverage (Times) equals Total Liabilities as of the period end divided by Total Equity as of the same date

Liquidity ratio is calculated by dividing liquid assets by Total liabilities

3.9

2.93.1 3.1 3.1

2.8 2.8 2.83.0

3.3

0

1

2

3

4

5

2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

751.9

58.8

912.0

1,251.5

59.0

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1 2010

GEL mln


Client Deposits

Borrowed Funds

Other Liabilities

Total Shareholders Equity

25% of Total Liabilities + equity




2% of Total Liabilitis + equity

3,033

34.2% 33.8%

27.2% 27.3%

37.6%

43.5%

35.6%38.7%37.6%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

May 2010

Analysis of deposits

CB, RB & WM deposits, BoG standalone

Client deposits by currency, 31 March 2010 Client deposit breakdown, 31 March 2010

Deposits by maturity, 31 March 2010

Standalone

22.6%

50.1%

3.2%

34.2%

77.4%65.8%49.9% 96.8%

0%10%20%30%40%50%60%70%80%90%

100%

RB CB WM TotalGEL Foreign Currency

54%

0%3%

9%

21%

13%

0%

10%

20%

30%

40%

50%

60%

On Demand Less than 1month

1 to 3 months 3 to 6 months 6 to 12 months Over 1 year

Individual current accounts, 10.3%

Corporate time & demand deposits,

17.6%

Individual time & demand deposits,

37.3%

Corporate current accounts, 34.8%

363.6 403.4 326.0 319.8 280.4 282.8 331.2 376.1 414.7

76.5 70.4 98.7 93.3 107.5131.4

163.1180.7

652.7681.5

576.2626.7

605.2 519.0

594.9587.6

656.1

81.6

0

200

400

600

800

1,000

1,200

1,400

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

RB Client Deposits WM Client Deposits CB Client Deposits

+11%

+4%

-19%

-15% +9%

-2%

-3%

-12% 1%

-14% +15%

17%

+22%+15%-5%+37%-14%+7% +24%

+14%

-1%

+10%

+12%

+11%

May 2010

Deposit yieldsStandalone

9.1%8.2% 8.0%

10.4%

12.5%13.7% 14.1%

11.7%10.5%

3.8% 4.0%5.0% 4.9% 4.5%

5.1% 4.9%5.8% 5.7%

7.0%7.5% 7.7%

8.4% 8.6%7.6%8.1%

5.6%5.4%7.2%

6.7%6.6%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

RB Deposit Yields, BoG Standalone CB Deposit Yields, BoG Standalone Blended Deposit Yields, BoG Standalone

May 2010

Risk managementCurrency risk management, Q1 2010Liquidity risk management, Q1 2010

Standalone

44.3

353.1

548.8558.5

222.0

558.3

-

379.4

569.7

381.9

149.2

818.5

(13.7)(58.0)

(31.7)(10.8)(187.4)

(260.2)-400

-200

0

200

400

600

800

1,000

Up To 1 Month 1-3 Month 3 Month - 1Year

1-5 Years Over 5 Years Past Due

GEL mln

Assets Liabilities Accumulated Liquidity Gap

0.8%

3.5%4.1%

1.7%

6.2%

3.8%

16.0%

0.6%

6.0%5.8%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

1-Dec-07 1-Mar-08 1-Jun-08 1-Sep-08 1-Dec-08 1-Mar-09 1-Jun-09 1-Sep-09 1-Dec-09 1-Mar-10

Open Foreign Currency Position (as % of Regulatory Capital)

May 2010

Corporate banking

Corporate client deposits, 31 March 2010

Corporate loan portfolio, 31 March 2010 Overview

Corporate gross loan portfolio growth

Standalone

Integrated client coverage in the following key sectors

Construction & Real EstateEnergyFast Moving Consumer GoodsFinancial InstitutionsForeign Organizations & Diplomatic MissionsPharmaceuticals & HealthcareRetail & Wholesale TradeState & IndustryTelecommunications, Media & TechnologyTransport & LogisticsSME

No.1 corporate bank in GeorgiaCirca 37.9% market share based on customer deposits(1)

Circa 29.6% market share based on corporate loans(2)

Integrated client coverage in key sectors85,500+ clients of which 9,047 served by dedicated relationshipbankersCirca 47% market share in trade finance and documentary operations(2)

Second largest leasing company in Georgia(2) – Georgian Leasing Company (GLC)Increased the number of corporate clients using the Bank’s payroll services from 1,424 at 31 December 2009 to 1,475 in Q1 2010Approximately 4,169 corporate accounts were opened at the bank in Q1 2010, bringing the total number of current accounts to 157,632

Notes: (1) As of September 2009, source: National Bank of Georgia, does not include interbank deposits(2) Management estimates (based on the NBG data)

Total corporate deposits: GEL 656 mln

Current Accounts &

Demand Deposits,

78%

Time Deposits,

22%

FMCG, 15%

Energy, 9%


Construction & Real Estate, 19%

Other, 6%

Pharmaceuticals and Healthcare,

2%

Trade, 32%

874826

875

794

928870

806765

880

951

0

100

200

300

400

500

600

700

800

900

1,000

YE 2007 31-Mar-08 30-Jun-08 30-Sep-08 31-Dec-08 31-Mar-09 30-Jun-09 30-Sep-09 31-Dec-09 31-Mar-10

GEL mln

-5% +6% -9% +17% -5%-7%-6% +15%+8%

May 2010

Retail Banking – No. 1 retail bank in Georgia

Leadership in consumer lending

RB loan portfolio, 31 March 2010Retail loans originated

Retail gross loan portfolio growth

Standalone

(1) Monthly average Total retail loans: GEL 847 mln Note: does not include Ukraine & Belarus

Q1 2009 YE 2009 Q1 2010

Number of Consumer Loans Outstanding* 61,593 48,614 50,335• Volume of Consumer Loans Outstanding (GEL mln)* 144.8 114.0 116.7• Credit Cards Outstanding 131,523 79,318 78,361

122.1

177.5 183.3

235.6

266.9

317.6

140.2

74.9 68.8

97.5 104.9128.2

55.9

0

50

100

150

200

250

300

350

Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1' 10

GEL mln

656

755

931995

923844

809 807847

922

-

200

400

600

800

1,000

1,200

YE 2007 Q1 08 Q2 08 Q3 09 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10

GEL mln

+15% +22% +1% +7% -7% -4%-9% -0.2% +5%

Credit cards and overdrafts, 16%

Micro loans, 14%

Mortgage loans, 43%

Consumer and other, 27%

May 2010

Loan origination

Micro loans (RB & WM)

Consumer loans (RB & WM)Mortgage loans (RB & WM)

Other RB & WM loans

Standalone

386.5

10.1 23.4

370.5

27.0

385.1

-50

100150

200250

300350

400450

Volume of Mortgage LoansOriginated

Volume of Mortgage LoansOutstanding

GEL mln

Q1 2009 Q4 2009 Q1 2010

-4%

+130+16%

+4%

15.3

124.0

40.0

98.9

120.7

51.6

-

20

40

60

80

100

120

140

Volume of Micro LoansOriginated

Volume of Micro LoansOutstanding

GEL mln

Q1 2009 Q4 2009 Q1 2010

+162%

-20%

+29%

+22%

316.6

259.7

3.8 3.3

258.0

2.8-

50

100

150

200

250

300

350

Volume of Other RB & WMLoans Originated*

Volume of Other RB & WMLoans Outstanding

GEL mln

Q1 2009 Q4 2009 Q1 2010

-11%

-19 %

-17%

-52%

+1%

32.1

155.5

43.7

126.9

48.7

121.6

-20406080

100120140160180

Volume of Consumer LoansOriginated

Volume of Consumer LoansOutstanding

GEL m ln

Q1 2009 Q4 2009 Q1 2010

+11%+89%

-18%

-4%

May 2010

Deposit origination

Number of RB & WM time deposits issued

Volume of deposits outstanding (CB)Volume of deposits outstanding (RB & WM)

Volume of RB & WM time deposits issued

Standalone

121.7 125.9 119.1100.2 94.8 99.0

112.8 113.7 116.7

8.016.9

16.225.8

20.034.9

40.6 34.640.7

0

20

40

60

80

100

120

140

160

180

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

Volume of WM time deposits issuedVolume of RB time deposits issued

GEL m ln

10,912

17,13617,855

19,403

12,051

15,312

18,322 18,739 19,092

-

5,000

10,000

15,000

20,000

25,000

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

169.9 185.3120.9 95.6 95.2 101.7 105.4 118.8 128.5

39.2 36.9

18.6 18.0 16.3 20.7 34.8 43.1 50.1

231.1262.9

257.0 302.1 262.2 266.3322.4

377.4416.8

0

100

200

300

400

500

600

700

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

Volume of RB & WM time deposits outstandingVolume of RB & WM demand deposits outstandingVolume of RB & WM current accounts outstanding

410.4 363.3 349.9 326.5 382.5 329.4400.4 370.0 435.5

53.639.2 26.8 90.2

69.379.2

74.2 78.175.1

188.7 279.0199.5 186.6 153.6

117.3112.0 139.4

145.6

0

100

200

300

400

500

600

700

800

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

Volume of CB time deposits outstandingVolume of CB demand deposits outstandingVolume of CB current accounts outstanding

May 2010

RB cross-selling

Cards penetration rate*

RB loans penetration rate*Product/client ratio

Current accounts & deposits penetration rate*

Standalone

* Calculated as percentage of Bank of Georgia clients for the period

2.22.4

2.73.0

3.23.3

3.5

3.1 3.02.8 2.8 2.7 2.8

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 31-Mar-10

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Number of clients (LHS) Number of products (LHS) Product/Client Ratio (RHS)

95.6% 98.7%104.0%

75.4% 73.2%67.6% 66.1% 66.18%

23.6% 26.9%31.4%

24.8%20.6% 17.5% 15.0%

10.56% 11.38%

62.61%

0%

20%

40%

60%

80%

100%

120%

Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10

Debit Cards Penetration Rate Credit Cards Penetration Rate

111.2% 111.3% 112.8%122.4%

9.7%9.2%7.6%7.1%8.9%7.3%6.7%5.6%

110.8%111.1%114.3%105.0%

14.4%

14.7%

15.7%16.4%19.0%19.5%19.8%20.0%

0%

20%

40%

60%

80%

100%

120%

140%

Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09

Demand & Time deposits Penetrartion rateUniversal Current Accounts Penetration RateStandard Current Accounts Penetration Rate

1.1% 1.1% 1.1% 1.1%

9.2% 7.6% 7.6%

2.2% 2.1% 1.9% 1.5% 0.8% 0.6% 0.6%

35.8%39.3%

44.3%46.4% 47.9% 47.6%

44.5% 44.8%

1.2%1.2%1.1%1.0%0.9%

11.8%

17.0%24.2%

29.1%30.9%31.7%

1.1%2.0%

34.1%

0%

10%

20%

30%

40%

50%

60%

Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10

Mortgage Loan Penetration Rate Consumer Loan Penetration RateMicro Loan Penetration rate Other Loans Penetration Rate

May 2010

Card processing

Transaction authorizations by Georgian Card

Number of cards serviced by Georgian CardClient banks

Georgian Card’s revenue & assets

Standalone

• 56% ownership of Georgian Card

• Migration to TietoEnatorTransmaster in 2005

• Enhanced functionality and new product support

1,105

1,7762,151

2,954 2,914

4,224

5,027

6,5847,176

8,536 8,6139,014

8,406

7,660 7,660 7,8397,449

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10

'000s

90 121203

286337

437 460

649721

776 774658 636 582

539.0 541 525

4966

72

84

119

138

247

227

256

278 304

256 261

227230 237 227

139

275

370

456

575

706

876 914 897809

769 778

186

753

0

200

400

600

800

1,000

1,200

1,400

Mar-06 Jun-06 Sep-06 Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10

'000s

Bank of Georgia Other Banks

1,0781,054

978

5.5 5.5 5.5

2.5 2.6

3.1 3.3

3.84.0 4.0 4.0

4.2

4.7 4.7

1.2

1.4

0.5

0.4

1.7

1.0 1.1

2.2

1.1

1.31.3

1.1

1.4 1.5

0

1

2

3

4

5

6

Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10

GEL mln

0

1

2

3

Total Assets (LHS) Revenue (RHS)

May 2010

Analysis of mortgage portfolio

Typical mortgage terms

Volume of mortgage loans outstandingNumber of mortgage loans issued & outstanding

Volume of mortgage loans issued

Standalone

Rate: 14.5% - 15.5%Tenor: Normally 10 yearsCurrency: US$ and GELLTV: Normally 70%%

231 259 423 437 517

7,4767,967 7,994 7,916 7,809 7,796

8,240

455 678 858 1,129 1,4261,915

850 691

2,3651,166

3,4094,230

5,340

6,881

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Q12007

Q22007

Q32007

Q42007

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

Number of mortgage loans issued Number of mortgage loans outstanding

33.837.6

43.3

69.5

81.3

96.1

32.5

18.5

10.1 11.5

23.1 23.427.0

0

20

40

60

80

100

120

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

101.6128.7

157.7

203.5

245.5

312.0 325.9

386.7 383.1 373.7 358.8 370.5 385.1

0

50

100

150

200

250

300

350

400

450

Q12007

Q22007

Q32007

Q42007

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

GEL mln

May 2010

Management (WM) performance review

WM loans, 31 March 2010

WM products penetrationWM clients and client assets

WM Deposits

Standalone

Notes: (1) Converted at exchange rates of GEL/US$, 1.793(2005),1.714(2006), 1.70 (Q1 2007), 1.67 (Q2 2007), 1.66 (Q3 2007), 1.59 (Q4 2007), 1.48 (Q1 2008), 1.42 (Q2 2008) , 1.41 (Q3 2008), 1.67 (Q4 2008), 1.67 (Q1 2009) and 1.67 (Q2 2009) Q3 2009 (1.68) Q4 2009 (1.69)

(2) PB Client Assets include: Balances on OneCard Accounts, Credit Balances on Other Cards, Credit Balances On Regular Current Accounts, Demand & Time Deposits, Brokerage & Asset Management Accounts, Pensions

101.0%93.7% 96.2%

79.2%

21.2% 25.5% 27.8%

62.7%

59.5%

71.4%

54.0%55.3%65.8%66.8%66.9%

52.2%65.8%

93.4%

111.2%114.2%

130.2%135.0%

32.8%31.8%32.2%40.1% 40.8% 52.5%

57.1%62.5%

65.2%69.6%70.2%76.4%78.2%80.7%

24.1%23.7%23.7%21.9%20.6%10.5%15.4%14.8%15.3%

0%

20%

40%

60%

80%

100%

120%

140%

160%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

OneCard P enet ration Rate All Other Cards Penetration RateDemand & Term Deposits Penetration Rat e Internet Banking P enetration Rat eSMS Banking P enet ration Rate

Other, 10.0%

Mortgage Loans, 72.4%

Consumer Loans, 12.1%

Car Loans, 5.5%

108.8

87.869.3

59.060.955.4

73.366.8

64.866.463.4

48.348.2

6.7

117.5

1,3411,4291,364

1,358

1,3411,3871,384

1,3821,3041,291

1,1871,081

943873

460

-

20

40

60

80

100

120

2004 2005 2006 Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

Q4'08

Q1'09

Q2'09

Q3'09

Q4'09

Q1'10

US$ mln

0

200

400

600

800

1,000

1,200

1,400

1,600

Private Banking Client Assets (LHS) Private Banking Clients (RHS)

155.2

49.531.5 35.7 35.1 36.9 47.9 52.1 57.2

23

3239

61 5867

84

111123

0

20

40

60

80

100

120

140

160

180

200

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

Current Accounts & Demand Deposits Time Deposits

178

7182

181

163

131

1049397

May 2010

BG Bank (Ukraine) standalone results overview

May 2010

BG Bank performance

Net income

Recurring operating cost structure, Q1 2010Revenue growth

Cost/Income Ratio

4.8 5.56.4

3.82.9

4.3 4.0 4.32.7

1.7 0.8

2.61.2 1.3

(0.5)

0.3

2.75.5

9.9%10.6%

12.9%

8.1%

7.2%7.5%

8.3%

6.0%

11.3%

-2

0

2

4

6

8

10

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

0%

2%

4%

6%

8%

10%

12%

14%

Net Interest Income Net Non-Interest Income Net Interest Margin, annualized

9.2

6.36.5

9.3

5.5 5.6 5.3

3.8

3.1

5.74.0

8.5

(1.6)

(4)

(2)

-

2

4

6

8

10

12

14

16

Q4 2009 Q1 2010

GEL mln

Recurring Operating Costs Provision Expense

(7.3)

(10.8)

(5.5)

(11.5)

0.3

(0.7)

0.7 0.7

(10.7)

(14)

(12)

(10)

(8)

(6)

(4)

(2)

0

2

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

GEL mln

109.2%116.9%

100.1%91.5%

74.7%

140.5%

76.0%

39.6%

145.2%

0%

20%

40%

60%

80%

100%

120%

140%

160%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

May 2010

BG Bank assets as at 31 March 2010Asset growth

Gross loan book growth

No international loan

10.110.12.3Tax Assets, Current And Deferred

GEL million Q1 2009 YE 2009 Q1 2010Available-For-Sale Securities 13.6 6.2 6.4Investments In Other Business Entities, Net 0.0 7.3 12.2Intangible Assets Owned, Net 0.5 1.0 0.9

Prepayments And Other Assets 1.4 1.2 0.9Other assets 17.8 25.8 30.6

30.625.817.8

11.511.3

14.4

131.9125.6

167.2

5.7

7.5

23.8

11.127.8

21.7

0

50

100

150

200

250

300

Q1 2010Q4 2009Q1 2009

Cash & Equivalents

Loans & Advances To Credit Institutions

Loan Portfolio


Other Assets

9% of Total Assets

10% of Total Assets

68% of Total Assets

6% of Total Assets

14% of Total Assets

4% of Total Assets

63% of Total Assets

6% of Total Assets

13% of Total Assets

245

GEL mln

7% of Total Assets

191198

6% of Total Assets

16% of Total Assets

6% of Total Assets

69% of Total Assets

3% of Total Assets

357 360 350 337249 245 205 202 198 191

849

1,217 1,213 1,150 1,129

965946

1,1491,131

934

0.3

0.20.3 0.30.3

0.2 0.2 0.20.2 0.2

0

200

400

600

800

1000

1200

1400

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 20100.0

0.1

0.1

0.2

0.2

0.3

0.3

0.4

Assets (GEL mln) Assets (UAH mln) GEL/UAH exchange rate, e-o-p

230 255 265 257194 199 190 186 177 184

917896925862 871

729

876 889836 819

0.3

0.20.2

0.3

0.30.3

0.20.2

0.20.2

0

100200300400

500

600

700800900

1000

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 20100.0

0.1

0.1

0.2

0.2

0.3

0.3

0.4

Loans (GEL mln) Loans (UAH mln) GEL/UAH exchange rate, e-o-p

May 2010

BG Bank loan portfolio

Retail loan portfolio breakdown, 31 March 2010

Corporate loan portfolio breakdown, 31 March 2010

Loan portfolio breakdown, 31 March 2010

Gross loans: GEL 184 millionGross corporate loans: GEL 148 million

Total retail loans: GEL 36 million

CB, 80%

RB & WM, 20%

Mortgage loans, 54.1%

Consumer and other*, 42.9%

Micro loans, 2.6%Credit cards, 0.4%

SME, 7%Other, 2%


Construction & Real Estate, 15% Trade, 55%

May 2010

BG Bank analysis of the loan book

Loans by maturity, 31 March 2010

Top ten borrower concentrationLoans by currency, 31 March 2010

Loan book collateralization

UAH, 52.8%

Foreign currency,

47.2%

23.6%

13.7%

38.5%

24.1%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1 to 3 months 3 to 6 months 6 months to 1 year Over 1 year

30.0% 31.3% 32.5%30.8% 31.4%

33.5%36.6%

38.9% 38.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

89.9%

91.5%90.9%

92.1%93.0%

95.8%96.6%

97.5%

96.2%

86%

88%

90%

92%

94%

96%

98%

100%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

May 2010

BG Bank provisioning policy

NPL coverage ratio

Loan loss reserveNPLs

Reserve for loan losses to gross loans

2.8% 2.2% 2.5%

10.5%

15.9%

20.5%

26.9%

31.5%

28.3%

0%

5%

10%

15%

20%

25%

30%

35%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

2.6 2.9 2.7 2.68.7

5.6

17.611.5 12.2

4.0

7.2

22.1

6.314.2

16.6

0.1 0.7 1.01.7% 1.3%

1.5%

4.6%

8.0%

14.6%12.8%

14.0%15.6%

0

5

10

15

20

25

30

35

Q1 2008 Q2 2008Q3 2008Q4 2008 Q1 2009Q2 2009Q3 2009 Q4 2009Q1 2010

GEL mln

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

RB CB NPL ratio

7.3 5.7 6.3 5.912.2 12.8 12.9 14.5 14.7

8.5

19.4

26.2

37.3 36.8 37.4

0.60.2 0.2

0

10

20

30

40

50

60

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

RB CB

167.0%

319.4%

210.0%224.8%

140.9%

198.8%

168.2%

166.4%

181.1%

0%

50%

100%

150%

200%

250%

300%

350%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

May 2010

BG Bank standalone liabilities breakdownLeverage ratio

Q1 2009 YE 2009 Q1 2010Issued Fixed Income Securities 0.1 0.7 0.0Tax Liabilities, Current And Deferred 0.0 0.2 0.0Accruals And Other Liabilities 1.6 1.8 1.4Other liabilities 1.8 2.7 1.4

4.3

2.3 2.1

2.9 3.0 3.2

3.9

5.44.9

0

1

2

3

4

5

6

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

34.625.2

60.9

122.3138.9

121.0

1.4

1.832.5

31.2

61.1

2.7

0

50

100

150

200

250

300

Q1 2010Q4 2009Q1 2009

GEL mln

Total Shareholders Equity

Other Liabilites

Borrowed Funds

Client Deposits














245

191198

May 2010

BG Bank client deposits

CB & RB client deposits

Deposit yieldsClient deposits

Deposits by maturity, 31 March 2010

270216

180 171127 121 115 117 139 122

656

554

856730

592 614 588 558 528 559 0.22

0.320.30

0.300.28

0.22 0.22 0.22 0.21 0.21

0

100

200

300

400

500

600

700

800

900

Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 20100.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

GEL mln UAH mln GEL/UAH exchange rate, e-o-p

12.0%

10.9%

12.3%

14.0%15.8%

11.8%12.2%

11.4%

12.8%

10%

11%

12%

13%

14%

15%

16%

17%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

85.460.5 61.5

45.7 47.0 37.7 43.258.8

40.1

130.6

119.7 109.1

81.7 74.177.1 73.9

80.0

82.2

0

50

100

150

200

250

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

CB Client Deposits RB Client Deposits

-29%

-8%

-9%

+2%

-25%

-26%

-9%

+3%

+4%

-20%

-4%

+15% +36%

+8%+3%

-32%

31.2%34.2%

9.7%

17.1%

7.8%

0%

5%

10%

15%

20%

25%

30%

35%

40%

On demand Less than 3 month 3 to 6 months 6 months to 1 year Over 1 year

May 2010

BG Bank analysis of depositsClient deposits by currency, 31 March 2010Client deposits breakdown, 31 March 2010

Client deposits: GEL 122 mln

Current accounts, 21%

Time&Demand deposits, 79%

UAH, 43%Foreign

currency, 57%

May 2010

BG Bank capital adequacy

Risk-weighted assets BIS vs. NBU

NBU capital adequacy ratiosBIS capital adequacy ratios

Net loans/deposits & Loans/(deposits+equity)

19.0%

30.6%

18.1% 19.5%

32.8%

21.1% 22.0%

27.9%30.5%

24.9%

32.6%31.3%28.4%

33.3%

25.8%

30.8%29.1%

16.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010


17.3%

23.3%

19.0%

25.8%

12.4% 12.9%14.0%

21.0%22.8% 23.8% 22.8%

13.7% 14.5% 15.6%

21.0%22.8% 23.8%

22.8%

0%

5%

10%

15%

20%

25%

30%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010


244.1230.4

271.77

196.18

158.65 158.13

282.1305.2

327.7355.0361.6

176.4178.2190.4

255.4

327.0340.6352.9

0

50

100

150

200

250

300

350

400

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

NBU BIS

77.7% 73.7% 74.6%68.1% 64.3%

69.7%

85.9%76.6%

84.1%

68.8%75.3%71.5%

98.2%91.9%

99.7%

116.5%113.7%

89.0%

0%

20%

40%

60%

80%

100%

120%

140%

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010Net Loans/(Total Deposits + Equity) Net Loans/Total Deposits

May 2010

Belarusky Narodny Bank (Belarus)

May 2010

BNB Bank performance

Net income

Recurring operating cost structure, Q1 2010Revenue growth

Cost/Income Ratio

1.1 1.0 1.01.4 1.6

2.3

0.618

0.6

0.8 1.40.8

0.7

15.0%

10.8% 10.6% 10.7%

13.4%

17.0%

0

3

5

Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Net Interest Income Net Non Interest Income Net Interest Margin, annualized

1.8

2.4

1.9

2.1 2.2

2.9

1.5 1.8

0.03

0.4

0

1

2

3

4

Q1 2009 Q1 2010

GEL mln

Recurring Operating Costs Provision Expense

0.70.6

0.2

0.7

(0.3)(0.4)

(0.2)

0.0

0.2

0.4

0.6

0.8

Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009

GEL mln

80.4%

61.5%

89.4%

60.6%66.6%

84.6%

0%10%20%30%40%50%60%70%80%90%

100%

Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

May 2010

BNB loan portfolio as at 31 March 2010

RB Loan Portfolio Breakdown, 31 March 2010

Loan loss reserve, 31 March 2010Loan Portfolio Breakdown, 31 March 2010

CB Loan Portfolio Breakdown, 31 March 2010Gross loans: GEL 32 mln

RB loans: GEL 1.7 mln* Other loans include car, POS and legacy retail loans

Loan loss reserve: GEL 1.3 mln

CB loans: GEL 30.6 mln

CB, 95%

RB, 5%

CB, 1.17

RB, 0.11

Mortgage loans, 1%

Consumer and other*, 98%

Other loans, 1% Other, 1%Industry & trade, 10%

Retail trade, 72%

Construction & real estate, 17%

May 2010

BNB client deposits as at 31 March 2010Client deposits breakdown, 31 March 2010Client deposits breakdown, 31 March 2010

4,586

6,972

0

2,000

4,000

6,000

8,000

10,000

12,000

Jan-00

GEL mln

RB Deposits Outstanding CB Deposits Outstanding

Current Accounts Outstanding ,

58.7%

Time Deposits Outstanding ,

38.7%

Demand Deposits

Outstanding , 2.6%

May 2010

BG Capital

May 2010

BG Capital

Proprietary book

Net income/(loss)Revenue

Headcount

(2.6)(2.3)

(4.6)

0.1

0.80.5

(3.9)

0.7

(5)

(4)

(3)

(2)

(1)

0

1

2

Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

19,276

36,968

3,9122,516 1,364

2,7905,289 5,292 5,334

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

20 22 22 18 15 16 13 13 15

27

2225 30 27

14

38 4334

5865

56

4539 43 44 41

30

0

10

20

30

40

50

60

70

80

90

100

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

BG Capital Georgia BG Capital Ukraine

1.6

(1.0)

(1.9)

(2.8)

1.21.5

1.8

0.4

2.9

(4)

(3)

(2)

(1)

0

1

2

3

4

Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010

GEL mln

May 2010

ContactNick EnukidzeChairman of the Supervisory Board+ 995 32 444 [email protected]

Irakli GilauriChief Executive Officer+995 32 444 [email protected]

Macca EkizashviliHead of Investor Relations+995 32 444 [email protected]

mailto:[email protected]



May 2010

Appendices

May 2010

Bank of Georgia shareholder structure & management

May 2010

Ownership structure

Supervisory board

Ownership structure, 31 December 2009

Management board

Broadly owned by over 100 institutional accounts

Irakli Gilauri Chief Executive Officer (CEO)

Sulkhan Gvalia Deputy CEO, Chief Risk officer

George Chiladze Deputy CEO, Finance

Irakli Burdiladze Deputy CEO, Chief Operating Officer

Mikheil Gomarteli Deputy CEO, Retail Banking

Avto Namicheishvili Deputy CEO, Legal

Archil Gachechiladze Deputy CEO, Corporate banking

Nikoloz Shurgaia Deputy CEO, International Banking

Nicholas Enukidze Chairman of the Supervisory Board

Allan Hirst Vice Chairman of the Supervisory Board, independent member

Ian Hague Member, Firebird Management LLC

Jyrki Talvitie Member, East Capital

Kaha Kiknavelidze Independent member

David Morrison Independent member

Irakli Gilauri Member, Chief Executive Officer

Local Shares Held by Institutional

Shareholders, 5.8%

Management & Employees**, 6.2%

Local Shares Held by Domestic and

Foreign Retail Shareholders, 2.5%

GDR Holders*, 85.4%

Name Number %GDR Holders* 26,745 85.4%Local Shares Held by Institutional Shareholders 1,831 5.8%Management & Employees** 1,957 6.2%Local Shares Held by Domestic and Foreign Retail Shareholders 773 2.5%Total Shares Outstanding 31,306 100.0%

- Adjusted for BG Capital' Proprietary Book (1 ) (5.3) Adjusted Total Shares Outstanding 31,301

(1) Treated as treasury shares as per IFRS*through BNY Nominees Limited** includes GDRs held as part of EECP

May 2010

Analyst coverage

Analyst Email

Andrzej Nowaczek [email protected]

Analyst Email

David Nangle [email protected]

Analyst Email

Radena Georgieva [email protected]

Analyst Email

Pedro Fonseca [email protected]





May 2010

Georgian banking sector – key trends 2006- Q1 2010

May 2010

Georgian banking sector – key trends 2007/Q1 2010GEL/US$

Period End YE 2006= 1.71

YE 2007=1.59

YE 2008=1.67

Q1 2009=1.67

Q2 2009=1.66

Q3 2009= 1.68

YE 2009= 1.69

Q1 2010= 1.75

GrowthMarket Share Market Share Market Share

Q1 2010(YE 2008) (YE 2009)

GEL mln YE 2008 YE 2009 Q1 2010As % of GDP*

2008 Y-O-Y

2009 Y-O-Y

Q1 2010 Q-O-Q

Top 5 Banks

Bank of Georgia

Top 5 Banks

Bank of Georgia

Top 5 Banks

Bank of Georgia

Total Assets 8,866 8,293 8,473 47.21% 23.00% -6.5% 2.2% 79.26% 32.89% 78.1% 33.0% 78.8% 34.3%Gross Loans 5,993 5,185 5,344 29.77% 30.59% -13.5% 3.1% 81.78% 32.87% 81.4% 31.8% 81.5% 32.7%Deposits 3,845 4,174 4,284 23.87% 9.51% 8.6% 2.6% 75.00% 28.76% 77.70% 27.4% 79.96% 29.7%Equity 1,517 1,517 1,549 8.63% 3.14% 0.0% 2.1% 75.69% 40.03% 79.60% 38.6% 79.65% 39.3%Net Income/(Loss) (216) (65.3) 15.3 0.1% NMF NMF NMF NMF NMF NMF 37.3% NMF NMF

21 banks as at 31 March 2010Minimum capital requirement GEL 12 mln and growingSince 1 January 2007 local presence established by HSBC, Halyk, Privat, JSC Kor Bank

No state ownership since 1995Very open to foreign ownership

All leading banks have meaningful foreign capital participationSignificant IT/infrastructure and marketing spend drives increasing retail banking penetrationIncreasing adoption of the universal banking business model, following the lead of Bank of Georgia

The economy and consumers significantly underlet (all-in consumer debt per capita US$163 at 31 December 2008)

* As % of YE 2009 GDP

May 2010

35.4%

23.7%

6.9% 7.7%

5.5%6.7%

14.3%

32.9%

22.0%

9.6%

7.7%

7.0%

4.8%

15.9%

33.0%

20.8%

9.8%8.6%

5.9%4.6%

17.3%

34.3%

21.3%

8.7% 9.1%

5.4% 4.9%

16.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

BoG TBC Bank Republic ProCredit Bank Cartu VTB Other Banks

YE 2007

YE 2008

YE 2009Q1 2010

Peer group’s market share in total assetsGEL/US$

Period End YE 2006 = 1.71

YE 2007=1.59

YE 2008=1.67

Q1 2009= 1.67

Q2 2009=1.66

Q3 2009=1.68

YE 2009= 1.69

Q1 2010= 1.75

Note: all data based on standalone accounts as reported to the National Bank of Georgia and as published by the National Bank of Georgia www.nbg.gov.ge

http://www.nbg.gov.ge

May 2010

11.3%

7.5%7.6%8.3%

7.0%

25.6%

32.7%

12.2%

6.0%6.4%

8.7%10.1%

23.7%

32.9%

13.0%

5.6%

7.6%

10.2%10.1%

21.6%

31.8%

13.0%

5.5%

7.5%

9.8%9.6%

22.0%

32.7%

0%

5%

10%

15%

20%

25%

30%

35%

BoG TBC Republic ProCredit Bank Cartu VTB Other Banks

YE 2007

YE 2008

YE 2009

Q1 2010

Peer group’s market share in gross loansGEL/US$


YE 2007=1.59

YE 2008=1.67

Q1 2009= 1.67

Q2 2009=1.66

Q3 2009=1.68

YE 2009= 1.69

Q1 2010= 1.75



May 2010

31.4%

24.7%

8.9%7.9% 8.6%

2.1%

16.5%

28.8%

22.5%

8.9% 8.1%

6.5% 6.8%

18.5%

27.4%

24.1%

10.8%9.1%

5.5%

2.7%

20.4%

29.7%

24.9%

9.3% 9.6%

6.5%

1.6%

18.4%

0%

5%

10%

15%

20%

25%

30%

35%

BoG TBC Republic ProCredit Bank VTB Cartu Other Banks

YE 2007

YE 2008

YE 2009Q1 2010

Peer group’s market share in depositsGEL/US$


YE 2007=1.59

YE 2008=1.67

Q1 2009= 1.67

Q2 2009=1.66

Q3 2009=1.68

YE 2009= 1.69

Q1 2010= 1.75



May 2010Page 66

This presentation contains statements that constitute “forward-looking statements”, including, but not limited to, statements relating to the implementation of strategic initiatives and other statements relating to our business development and financial performance.

While these forward-looking statements represent our judgments and future expectations concerning the development of our business, a number of risks, uncertainties and other factors could cause actual developments and results to differ materially from our expectations.

These factors include, but are not limited to, (1) general market, macroeconomic, governmental, legislative and regulatory trends, (2) movements in local and international currency exchange rates, interest rates and securities markets, (3) competitive pressures, (4) technological developments, (5) changes in the financial position or credit worthiness of our customers, obligors and counterparties and developments in the markets in which they operate, (6) management changes and changes to our group structure and (7) other key factors that we have indicated could adversely affect our business and financial performance, which are contained elsewhere in this presentation and in our past and future filings and reports, including those filed with the NSCG.

We are under no obligation (and expressly disclaim any such obligations) to update or alter our forward-looking statements whether as a result of new information, future events, or otherwise.

Caution Regarding Forward-Looking Statements

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