TBC Bank Recent Financial performance H1 2011

Transcription

1 TBC Bank Recent Financial performance H1 211

2 Contents Georgian Banking Sector TBC Bank at a Glance Business lines Strategy and Forecast Financials Capital 2

3 Gel Bln Georgia At A Glance General Population: 4.4 million Currency: Georgian Lari (GEL) Economy GDP: USD 14.1 bln; GDP per Capita: USD 3,131 (Projected 211) Total Government Debt (in % of GDP): 36.8% (Projected 211) Average yearly Inflation June 211: 11.3%; non-food inflation 21 : 2.3%* Currency 1 USD = GEL , 1 EUR = GEL 2.454** USD/GEL during last five years: Max 1.89, Min 1.4 Ratings Fitch Rating B+ Standard & Poor's: B+/Stable Moody's rating: Ba3/Stable Recent Achievements No 1 reformer named by IFC/World Bank (Doing Business Report 211) No 4 in TI 21 Global Corruption Barometer together with Iceland and Portugal (TI 21 Global Corruption Barometer) No 12 globally in Ease of Doing Business in 21 (Doing Business Report 211) GDP Source: IMF Components of Nominal GDP* (21 Prel) Industry 16.9% Trade 16.6% Public Administration 13. Transport & Communication 11.6% Agriculture 8.4% Healthcare & Social Assistance 6.6% Construction 6.3% Education 4.8% Other 15.7% * Calculated using nominal GDP (preliminary) at basic prices Source: Geostat Nominal GDP (GEL $bln) Real GDP growth, y-o-y (%) % 12.3% 6.4% 5.3% 2.4% % % Prel 211 F 212 F 13% 1 7% 4% 1% -2% -5% -8% *Geostat Figure **As of June 3 Source: IMF 3

4 Attractive Macroeconomic and Banking Sector Fundamentals Real GDP growth 21 and Loan Book Growth 21 Loan to GDP and Deposits to GDP 15% 13% 5 % 2 % 5 % 1 13% 3% -6% 26% 2 18% 131% 93% 153% 14% 83% 188% 78% 114% 11% 15 9% 7% 5% 3% 1% -1% -3% 8.2% 6.4% % 3.9% 4.3% -1.3%.2% 2.3% ROM BUL CZE POL RUS UKR GEO KAZ TUR Real GDP growth Loan Book Growth real gdp growth in 21 real gdp growth in 21 * Source: Fitch report, IMF data Impaired Loans and Reserve Coverage 67% 1 76% 37% 52% 58% 35% 33% 43% 5 26% 7 76% 43% 43% 53% 54% 48% 59% 3 GEO KAZ RUS ROM POL TUR UKR CZE BUL Loans/GDP Deposits/GDP Loan/Deposits * Source: Individual countries Central Banks, Analyst Research. Data as at 31 December 21 Equity to Assets and ROAE 4 35% 3 25% 15% 1 5% 88% 168% 57% 1 65% 48% 56% 9 96% 4% 6% 7% 8% 8% TUR GEO CZE RUS POL BUL ROM UKR KAZ impaired loans * Source: Fitch report; Data as at 31 December 21 12% Reserve coverage of Impaired Loans 21% 33% 3 25% 15% 1 5% NM 12.5% NM 11.9% NM 16.3% 6.3% 4.9% 13.5% 9% 9% 11% 11% 12% 13% 14% 14% (1) ROM POL KAZ CZE UKR TUR BUL RUS GEO Equity/Assets ROAE Source: Individual countries Central Banks, Analyst Research. Data as at 31 December 21 unless otherwise stated. Note(1) Data as at 31 December 29. Georgian Banking System ROE is given for 211 H1 NBG reporting Standard (1) 17% 4

5 Main Regulatory Requirements NBG Main Regulatory Requirements Minimum Reserves Capital Requirements Liquidity Ratio Yearly Repayment Fee FX minimum reserves from 5% to 15% (From August 211) For the borrowings in GEL of more than 1 year and borrowings in FC of more than 2 years not required from August 211 Tier 1 > 8% and Total Capital > 12% Major difference with Basel is Foreign currency loan weighting at 175% Liquidity ratio increased from to 3, (from October 21) (NBG has acknowledged prudent liquidity management policy of TBC by Setting lower limit) Early repayment fee of not more than 2% (May 211) Exposure ratios Single Related party < 5% of capital All related party < 25% of capital Group exposure < 25 % of capital In addition No limits or restrictions on the sector or FX policy In the future NBG is discussing to introduce Loan to Deposit ratio of < 13 and non-resident deposit to total deposit book ratios <. We will meet the requirements if it materializes as our Loan to Deposits is forecasted to be at 117% and non resident deposits is less than 5% 5

6 Gel Mln Gel Mln Gel Mln Gel Mln Georgian Banking Sector Growth Dynamics in USD Millions Georgian Banking Sector Loan Growth Over Last 5 Years 7, 5,6 4,2 2,8 1,4 4,589 84% 5,993 Total Loans Growth % 31% 5,185-13% 6,261 21% 6, I H Source: National Bank of Georgia. NBG Reporting Standard *Growth Annualized ,5 3,6 2,7 1,8 9 Georgian Banking Sector Loan Growth Over Last 5 Years 2,993 1,596 3,469 2,524 Corporate loans 3,12 2,84 Retail Loans 3,847 2,414 4, I H Source: National Bank of Georgia. NBG Reporting Standard 2,713 Georgian Banking Sector Deposit Growth Over Last 5 Years Georgian Banking Sector Deposit Growth Over Last 5 Years Total Deposits Growth % Corporate Deposits Retail Deposits 7, 5,6 4,2 2,8 1,4 3,215 65% 3,568 3,95 11% 5,488 39% 5,775 11% I H Source: National Bank of Georgia. NBG Reporting Standard *Growth Annuialized , 3,2 2,4 1,6 8 2,846 2,964 2,812 2,641 2,14 1,666 1,859 1,846 1,549 1, I H Source: National Bank of Georgia. NBG Reporting Standard 6

7 Georgian Banking Sector Eight Largest Banks Market Shares Q2 211 Retail Deposits Total Loans Total Deposits 33.1% % % 27.6% 11.8% 8.3% 8.5% 8.1% 6.4% 7.5% 6.1% 6.4% 6.5% 2.5% 3.9% 3.2% 2.4% 3.4% % 1.5% Number of world s largest financial institutions have partnered with Georgian banks : All banks, including TBC Standalone, NBG Reporting Standards Y 2 Y 22 Y 24 Y 26 Y 28 Y 21 Y 211 Q2 7

8 Contents Georgian Banking Sector TBC Bank at a Glance Business lines Strategy and Forecast Financials Capital 8

9 TBC Bank at a Glance Key Facts About TBC No 1 by Retail Deposits 33.1% of market share as at 3 June 211 A leading bank in the country with 25.1% of total customer loans market share as at 3 June branches, 183 ATMs, 2,414 POS s across Georgia Number of accounts c. 615,8; Number of employees c. 2,4 Entered microfinance segment in May, 211 through acquiring Bank Constanta Presence in Azerbaijan-subsidiary TBC Kredit - non-banking credit organization Financial Highlights and Ratios (As of and for the Q2 211) USD m Total assets 1,657 Net loans 1,26 Customer deposits 972 Stockholders equity 249 Financial Ratios ROE annualized (H1 211) 24.3% Cost to income (H1 211) 49.2% BIS Tier1 capital adequacy ratio (H1 211) 19.5% Source: TBC Bank Consolidated IFRS Statements (Unaudited) Exchange Rate Used: USD/GEL Ratings Fitch Long Term B+ Corporate 49.1% Retail 35.5% Moody s Foreign Currency B1 Loan portfolio composition as per the segments 2-nd Q 211 SME 1.7% Micro** 4.7% Notes: Market shares are NBG Based, * Micro Segment includes Constanta Portfolio, Number of branches and number of accounts excludes Constanta Shareholder Structure Georgian Shareholders 35.3% European Bank for Reconstruction and Development (EBRD) 2. International Financial Corporation (IFC) 2. Deutsche Investitions-und Entwicklungsgesellschaft (DEG) 11.4% JP Morgan 5. Ashmor 5. Netherlands Development Finance Company (FMO) 3.3% 9

10 History 1993 TBC bank was granted banking license to Conduct International Operations in May 1996 TBC Bank became a member of the international financial information exchange system S.W.I.F.T The Bank entered into a credit line with the World Bank for a principal amount of U.S.$1 million 1998 TBC received funds in an amount of U.S.$ 2 million from EBRD, U.S.$ 3 million from IFC and DM 3 million from DEG 1999 The volume of the Bank s letter of credit provided by the EBRD was increased by USD 2 million 2 IFC and DEG became TBC Bank shareholders, each with a 1 share 22 TBC Bank became the principle member of VISA-INTERNATIONAL and started issuing Visa plastic card EBRD allocated a USD 6 million credit line to the bank TBC Bank s total assets market share increased by 2.9 percentage points from y/e 22 and reached historical maximum of 19.7 percent market share by y/e 23 The Bank s subsidiary, TBC Leasing began operations In February the Bank s new Head Office was opened TBC Bank s total assets market share increased by 2.9 percentage points from y/e 23 and reached historical maximum of 22.6 percentage market share by y/e 25 TBC Bank has acquired the license of general member bank from MasterCard International 26 The Bank entered into a U.S.$35 million loan facility with Citibank The Bank raised USD 12m funding from J.P. Morgan, Credit Suisse and FMO, that included both senior and subordinated loans TBC bank s market share further increased by 1.1 percentage points from y/e 25 and reached historical maximum of 23.7 percent The Bank acquired 75% of the share capital of SOA Credit (currently TBC Kredit LLC), a company incorporated in Azerbaijan The TBC Bank attracted funds totaling USD 26 million from foreign markets, including following international financial institutions: DEG, FMO, Merrill Lynch, Rose Mount, OTP, Banco International, EBRD, OPIC, CITI Bank In order to support the victims of the hostilities, TBC Bank established a charitable organization TBC Foundation and made the initial contribution of GEL 5 million EBRD, FMO, JP Morgan and Ashmore became the shareholders of TBC Bank The Bank raised U.S.$ m from four international financial institutions: IFC, EBRD, FMO and DEG, that included: Equity contribution - $39.9m, Senior Loan $52.3m, and Subordinated Loan - $44m Recapitalization transactions changed the composition of the Supervisory Board: Each IFI shareholder has its nominee to the Board The Bank s growth continued despite the effects of the global financial crisis as reflected by the levels of specific financial indicators as at 31 December In March 211, the Bank acquired [8]% of the share capital of Bank Constanta, through which it entered the micro-finance segment. TBC Bank was granted Visa and MasterCard licenses for electronic commerce merchant acquiring 1

11 Current Shareholders Shareholder Structure Founder Shareholders Source: IFRS Consolidated Statements Two Founder Shareholders, 28% EBRD, D E G 11% I F C, FMO 3% Management & Other 8% Ashmore 5% JPMorgan 5% IFC Became a shareholder in May 2. Eric Rajenda Member of the Supervisory Board nominated by IFC in 21 DEG Became a shareholder in May 2. Steffen Shuhany Member of the Supervisory Board nominated by DEG in 27 EBRD Became a shareholder in April 29. Mike Hesketh Member of the Supervisory Board nominated by EBRD in 29 FMO Became a shareholder in April 29. Mike Hesketh Member of the Supervisory Board nominated by FMO in 29 JP Morgan and Ashmore Became a shareholder in April 29, They are entitled (but not required) to send an observer to attend all meetings of the Supervisory Board 11 Mamuka Khazaradze, Chairman of the supervisory board since Founded TBC-Group and JSC TBC Bank in 1992 Until the early 2s, Vice-Chairman of the Supervisory Board of Microfinance Bank of Georgia. Founded IDS Borjomi Georgia, Borjomi Beverages Co.N.V. In 24 he founded Georgian Reconstruction and Development Company (GRDC), Founded and served as the Chairman of the Lisi Lake Development and the private high school -The American Academy in Tbilisi. Badri Japaridze, deputy chairman of the board since Co-Founder of TBC-Group and JSC TBC Bank in 1992 Member of the Board of GeoPlant, the largest Georgian producer and exporter of green tea. Since the early-2s, member of the Supervisory Board of both American Chamber of Commerce in Georgia and EU-Georgia Business Council (EUGBC). Board Member of Georgian Reconstruction and Development Company (GRDC) and Bank Constanta. Chairman of the Board of TBC-TV, a Georgian advertising company, and, Chairman of the Board of TBC Kredit, TBC Bank s subsidiary in Azerbaijan. 11

12 IFI Shareholders EBRD - 2. EBRD Total Exposure to TBC Bank Senior Loan - USD 71 ml Subordinated Loan - USD 18.5 ml Diversified product range: SME Mortgage Energy Efficiency Trade Finance RCA Subordinated Loan Agro Loan Local Currency Loan Co Financing Agreement Revolving Facility TC Projects EUR 5, worth TC project provided by EBRD in covered 5 modules including: Corporate Recovery, Risk Management, Accounting and Finance, HR, IT. Ongoing TC project of Trade finance through E-learning Various TC projects in different years to strengthen SME financing, Environmental and Social Management System, Credit Risks, Operational Risks FMO 3.3% Total Exposure to TBC Bank Senior Loan - USD 21 ml Subordinated Loan - USD 27 ml Diversified product range: Subordinated Loan SME Loan Mortgage Loan Revolving Facility TC Projects TC projects in different years to strengthen ALM IFC -2. Total Exposure to TBC Bank Senior Loan - USD 31 ml Subordinated Loan - USD 2.5 ml Diversified product range: Subordinated Loan Senior Loan Revolving Facility TC Projects Various TC projects in different years to strengthen SME financing, Environmental and Social Management System, Credit Risks, Operational Risks DEG 11.4% Total Exposure to TBC Bank No Senior Loan Subordinated Loan - USD 2 ml Diversified product range: Subordinated Loan Senior Loan Revolving Facility TC Projects Various TC projects in different years to strengthen Environmental and Social Management System, Credit Risks 12

13 A Winning Franchise with Robust Performance throughout the Financial Crisis Total Assets Net Loans Net Profit NPLs (PAR 9) 2,762 (21.8% growth) 1,71 (23.8% growth) H* 211 1H* 211 1H* 211 1H*.85% 21 2,268 (3.5% growth) 21 1,381 (39.7% growth) % 29 1, % ROAE ROAA C/I Cost Of Risk 24% (Annualized) 3.8% (Annualized) H* 211 1H* 211 1H* 211 1H*.4% 21 14% % % % 29 1% 29.2% 57.9%* % Awards All Figures in Million GEL *IFRS Statements Unaudited 211 Q2 *29 Excludes one-off income of GEL 259 and one-off expense 4,6 Banker Award 21 Euromoney Award 211 Source: TBC Bank Consolidated IFRS Audited Figures (Unaudited for H1 211) 13

14 GEL Mln TBC Bank Distribution Channels Effective Branch Network Keeping up with Modern Day Banking Total Tbilisi Regions Bank of Georgia Branches 45 Procredit Bank Highly-Organized Call Center POS 2414 TBC Bank Bank Republic Internet Banking 66K customers TBC Pay 442 VTB Bank Mobile Banking 6.5K customers Source: TBC Bank Internal Figures Net Loans and Deposits/Number of Branches* The Best Employer in the Market 5 Net Loans/Number of Branches Total Customar Deposits/Number of Branches The Most Desired Employer in Georgia - according to on-line survey held by National Credit Information Bureau Superior Customer Experience TBC BOG VTB Republic Procredit I 28-II 29-I 29-II 21-I 21-II 211-I Source: *NBG Based for comparison for 1H 211 TBC BOG Republic ProCredit Source: TNS Georgia 211 report 14

15 3.14 % 1.63 % Gel Mln Gel Mln Sustainable Growth Total Gross Customer Loans Total Customer Deposits Corporate Loans Retail Loans Growth % Corporate Deposits Retail Deposits Growth % 1,6 1, % % 56% 21% 25% , Q ,6 1, % 41% 38% % 19% % Q2 5 45% 4 35% 3 25% 15% 1 5% Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211) Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211) Total Loans Market Shares Total Deposits Market Shares * % 21.99% 22.78% 23.38% % 25.13% 28% 26% % 24% 22% 15% 1-Mar 1-Jun 1-Sep 1-Dec 11-Mar 3-Jun * Excludes Railway Transfer of USD 25m Source: NBG, NBG Reporting Standard 1-Mar 1-Jun 1-Sep 1-Dec 11-Mar 3-Jun Source: NBG, NBG Reporting Standard 15

16 Contents Georgian Banking Sector TBC Bank at a Glance Business lines Strategy and Forecast Financials Capital 16

17 Universal Bank with Diverse Customer Base Corporate SME Retail Micro **** Loans > USD 1,5m Or Loans < USD 1,5m Or All Individual Total Portfolio of Turnover => GEL 8m Turnover < Customers Constanta Loans < GEL 8m USD 15K Customer Loans (Gel Mln) Customer Deposits* (Gel Mln) # of accounts ( )** Net Income (Gel Mln)*** ***** Q Q Q Q2 % of Loans N/A N/A N/A 5 % of Deposits N/A N/A N/A.4 Source: 21 TBC Bank audited consolidated IFRS Figures, SME Deposits Internal Data (H1 211 unaudited) Notes: *Customer Deposits Internal Data, **Number of Accounts Internal Data - excluding accounts with zero balances, *** Net Income Internal Data, **** Bank Constanta Data, ***** Bank Constanta Standalone Profit, consolidated by TBC as at H1 211 will be only.5 mln Note: figures exclude Minority shares 17

18 Gel mln Gel mln Corporate & SME Banking Corporate Defined as loans more than USD 1.5 m and turnover minimum GEL 8 m 2 nd position in the market by loan and deposit portfolio size as well as by the number of clients c. 1,4 clients, 4,24 accounts, 76 loans Strong industry expertise. Especially strong presence in following industries: Energy, Consumer Product and Services, Oil and Gas, Food and Drinks, Construction Convenient Service Model in the head office and major branches, Bank- Client, Internet Banking, Call Centre. 81%* of non cash transactions are performed by e-channels The strongest brand and most appropriate image Diversified product: Trade Finance, Asset Finance, Project Finance, Working Capital, Syndicated Loans SME Defined as loans up to USD 1.5 m and turnover up to GEL 8 m No 1 by SME Deposits 149 mln GEL vs 118 mln GEL PCB total Corporate** No 2 by SME Loans 176 mln GEL vs 386 mln GEL of PCB** c. 26 customers, 44, accounts, 1,2 loans Customers can access 45 branches across all major cities with the highest service quality that is expressed in bright and comfortable environment, politeness and high qualification of staff and quick service Strong presence in following industries: Consumer Product and Services, Food and Drinks, Real Estate, Health care and Construction etc Convenient Internet banking, Bank-Client, Internet Banking, Call Centre. 87%* of non cash transactions are performed by e-channels * TBC bank Standalone ** SME market position based on TBC Bank Standalone NBG standard reporting Corporate Loans & Deposits 1,2 1, % Corporate Loans Market Share CL 82 SME Loans 23% 24% 26% 22% 18% 18% Corporate Deposits Market Share CD Q2 Surce: TBC Bank Consolidated IFRS Statement (derived from audited statement, H1 211 unaudited). market Shares TBC Standalone NBG Reporting based SME Loans & Deposits SME Deposits Q2 Surce: TBC Bank Consolidated IFRS Statement (derived from audited statement, H1 211 unaudited). 3 25% 15% 1 5% 18

19 Gel Mln Gel Mln Retail & Micro Banking Retail Segment Defined as all individual customers Number 1 in Deposits, 2 nd in Loans 45 branches, 183 ATMs, 2414 POS s across Georgia c.567,5 accounts, c. 512,8 Debit Cards, c.5,5 mortgages 942 VIP customers, separate service and products for VIPs with Personal Bankers The highest Service quality in the branches that is expressed in bright and comfortable environment, politeness and high qualification of staff and quick service Significant multi channel capabilities including internet banking, SMS banking, TBC Cash in and call centre. 4* cash in and 61%* of non cash transactions are performed by e-channels The strongest brand and most appropriate image Retail Loans & Deposits 1,5 1, Retail Loans Market Share RD 19.8% 2.1% % 31.8% 671 Retail Deposits Market Share RL % 23.2% 24.2% Q2 Source: TBC Bank Consolidated IFRS Figures (Unaudited H1), NBG standards for market share information % 3 25% 15% 1 5% Micro Segment Micro Loans Recently acquired bank focused purely on micro finance segment with the strongest image and the best developed expertise in the segment Total Loans Market Share 4-th in the micro loans % 1.4% c. 442 employees, assets of GEL 114 m (2Q 211) c. 14, accounts, 25, loans 22 branches across the country, specific products for microfinance in rural areas Well-diversified high quality credit portfolio % 1.2% % 1..8%.6%.4% 15.2% Q2. *Note: TBC Bank Standane Source: bank Constanta IFRS Figures (Unaudited H1), NBG standards for market share information. 19

20 Contents Georgian Banking Sector TBC Bank at a Glance Business lines Strategy and Forecast Financials Capital 2

21 A Fine-tuned Strategy Main Targets 211 Q2 Medium Term Targets ROE 24.3% Cost to income (without Provisions) 49.6% 51. Market Share in deposits 27.6% 28.6% Market Share in loans 25.1% 26.3% Segment Aspirations 211 Q2 Medium Term Targets Retail SME Corporate Deposits Loans 33.1% 24.2% Deposits 1 PCB* Loans 42% Deposits 22.4% Loans 25.7% 33.5% 25.3% 1 PCB* 43% 24.7% 25.8% Micro Loans/Constanta Loans 7% N/A Strategic Initiatives Description 1. Establish the Best Multichannel Service and Sales Model Implement the best (functionality and design) Multichannel platform in the region. (Including internet-banking, mobile/ipad banking. Actively, promote sales and service though the e-channels 2. Achieve Breakthrough in Automation and Quality of Processes to Improve Customer Satisfaction Replacement of the core banking software applications (Includes: cards, loans and deposits modules), development of a single customer view to further enhance customer experience and decrease cost per transition. 3. Become Number One in Non-Resident Deposit Portfolio 4. Microfinance Segment Development Form foreign representatives offices, create organizational system for direct sales, Improve products and procedures and improve technological channels and communication to attract non-resident deposit.hence support growth and decrease cost of funding. Increase market penetration by opening branches in rural areas, develop new products and services, tasilored to microfinance segment, laverage from TBC Bank knowledge and experitese for synergy effect, develop cross selling capabilities between TBC and Constanta *ProCredit Bank Source: TBC Bank IFRS Statement (Unaudited 211 H1), Medium Term targets from Internal Data 21

22 Contents Georgian Banking Sector TBC Bank at a Glance Business lines Strategy and Forecast Financials Capital 22

23 Gel Mln Gel Mln Gel Mln Gel Mln Rapid Post Crisis Recovery Operating Efficiency Provision Expenses % 49.6% % 52.9% H % % 2.3%.4% H 16% 14% 12% 1 8% 6% 4% 2% Net Revenue Non-Operating Expenses Cost to Income Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211). Note: 29 Cost to Income Ratio excludes extraordinary income Net Income, ROAE Loan Provision Expense Cost of Risk Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211). Net Income, ROAA % 24% % %.2% 3 2.5% 3.8% H H -1 Net Income ROAE, annualized Net Income ROAA, annualized Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211). Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211). 23

24 Well Diversified Loan Book Loan Book Historical Data Loans by Currency, 211, June 3 2 1, ,548 2% 9% 1 1, % 37% 9% 35% % 49% 53% 4 52% Q2 Consolidated Audited IFRS figures, unaudited data for 211 Q2 18% 17% 49% Retail SME Corporate % % RB CB Total Source: Audited IFRS Statements, Unaudited data for 211 Q2 FC GEL Agriculture, 1% Food and drink, 7% Corporate Loans RB Loans SME Loans Other, 23% Consumer Service and Product, 17% Financial service, 4% Source: TBC Bank Standalone NBG Reporting Standard As of June 3 Oil and gas, 13% Development and real estate realization, 8% Energy, 9% Construction, 8% Communication, 11% Mortgage, 49% Pawn-Shops, 7% Consumer, 23% Credit Cards, 14% Cash Covered, 3% Source: TBC Bank Standalone NBG Reporting Standard As of June 3 Fast consumer, 5% Financial service, 3% Raw Materials, 3% Other, 8% Real Estate, 19% Consumer Service and Product, 3 Construction, 13% Food and drink, 11% Healt Care, 8% Transport and Logistics, 4% Oil and gas, 2% Source: TBC Bank Standalone NBG Reporting Standard As of June 3 24

25 Concentration and Quality of The Loan Book Provision Level to Gross Loans and NPL Coverage Loan Concentration to Gross Loans Provision Level To Gross Loans NPL + restructured loans coverage ratio 2 Largest Borrowers Single Largest Borrower % 1 116% 1 84% 8 68% 15.47% % 1.81% 8.57% H NPLs* to Gross Loans Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211) % 23% 24% 25% 1 3% 2% 3% 3% H Source: TBC Bank Internal Data Related Party Loans to Capital NPL's Gross Loans NPLs+Restructured Loans to Gross Loans All Related party Loans Top 1 Related party Loan % % 6.8% 3.6% 2.6% 1.6%.8% H % 13% 8% 7% 6% 2% 4% 2% H Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211) Source: TBC Bank Internal Data *NPLs are defined as Loans overdue more than 9 days 25

26 Strong and Growing Funding Base Liabilities Structure, 211, Q2 Deposits by Type Subordinated debt, 6% Other liabilities, 2% Due to other banks, 5% 2, 1,6 Current/settlement accounts Term deposits 1,365 1,62 Other borrowed funds, 17% 1, % 48% Customer Accounts, 69% % 48% 57% 52% 55% 52% H Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211); Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211); Deposits by Currency Deposit Portfolio Concentration (M GEL) 2, 1,6 1,2 8 4 GEL FC Loans to Deposits Ratio 1,62 172% 1, % 113% 115% % % % 23.9% % 22.72% H Largest Deposits All Related Party Deposits 18.2% 16.3% 17.9% 11.3% 1.1%.9%.7%.8% H Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 211); Source: TBC Bank Internal Data 26

27 Contents Georgian Banking Sector TBC Bank at a Glance Business lines Strategy and Forecast Financials Capital 27

28 Strong Capital Base BIS Capital Adequacy Ratios NBG Capital Adequacy Ratios 5 45% % 4 Minimum Requirement of Total Capital Adequacy 12% Minimum Requirement of Tier I Capital Adequacy 8% 35% 3 25% 15% % 25.3% 21.4% % 35% 3 25% 15% % % % 13.44% 1.3% 5% 5% H H Tier I Capital Adequacy Ratio Total Capital Adequacy Ratio Tier I Capital Adequacy Ratio Total Capital Adequacy Ratio Source: TBC Bank Consolidated IFRS Audited Figures (Unaudited IFRS 211 1H) Source: TBC Bank Standalone NBG Reporting Standard, (Unaudited IFRS 211 1H) Main Difference between BIS and NBG Capital Adequacy Rations Foreign Currency Loans are weighting - 175% for NBG regulations General Loan Reserve are included in NBG Capital Revaluation Reserve is included in BIS Capital 28