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LONDON (Alliance News) - Bank of Georgia Group PLC on Thursday reported an increase in interim profit as lending grew.
The FTSE 250-listed lender pretax profit increased 10% to GEL186.5 million, about GBP57.1 million, from GEL169.6 million, about GBP52.0 million, the year before.
Revenue increased 18% to GEL489.3 million from GEL415.3 million. The lender did suffer from an increase in net non-recurring costs, however, to GEL46.8 million from GEL2.7 million the year before.
The increase in one-time costs was mainly due to the bank demerging its investment business in May, now listed independently in London as Georgia Capital PLC.
Bank of Georgia saw a 29% increase in loans to customers and finance lease receivables to GEL8.08 billion from GEL6.52 billion and a 35% growth in deposits to GEL7.17 billion from GEL5.32 billion.
Retail Banking, which makes up more than 70% of the total in terms of loans, saw a 30% increase in its net loan book to GEL5.38 billion from GEL4.16 billion.
This growth is reflected in the lender increasing its mortgage portfolio 49% in the last year to GEL653.0 million from GEL438.8 million.
Bank of Georgia said its "renewed focus" in corporate lending is also now "delivering high quality lending growth".
The lender's net interest margin in the recent half was 7.0%, down from 7.3% a year ago. Bank of Georgia said the banking sector's "increasing focus" on lending to "finer margin" corporate and small & medium enterprise clients has resulted in the fall in margin.
The retail and corporate bank said the "strong" economic growth in Georgia has also supported the company's performance. The country experienced real GDP growth of 5.7% in the first half.
Bank of Georgia said business confidence in Georgia "remains strong", with exports continuing to grow "rapidly" and tourist inflows at "unparalleled levels" in the first half.
Looking ahead, the lender believes the country's macroeconomic growth looks robust and expects it to continue - supported by the government's "ongoing growth-oriented reform programme".
The Georgian government's "prudent" economic and monetary policies ensure the bank is "well positioned" to capitalise on the country's economic growth, it said.
Bank of Georgia expects to deliver "solid franchise growth, strong operational and capital efficiency, and superior returns to shareholders" in the second half.
Shares in Bank of Georgia were up 2.7% Thursday at 1,714.80 pence each.