The FINANCIAL — Tbilisi . Bank of Georgia is launching a new campaign that permits customers to accept mortgage loans in the national currency at 15% for a 10 year term. The campaign will last from April 1 till May 1.
Under the terms of the campaign customers will be free of obligations to pay taxes when accepting a loan. The Bank also takes on the obligation to pay an insurance fee instead of the customer for a year and will compensate the fee for registering real estate at the public registry and other notary’s expenses.
“Bank of Georgia was the first on the local market to start giving out loans in the national currency. This fact permits customers to avoid additional risks connected with inflation,” Giorgi Chiladze, Deputy CEO of Bank of Georgia, told The FINANCIAL.
The total volume of giving out loans in 2009, by Bank of Georgia was more than 1.7 billion GEL. Compared with the third part of 2009 it was increased by 5.2%.
The most demanded type of loan in 2009 was the mortgage loan, it occupied 43% of the total credit portfolio, which was followed by consumer loans, with 29%, credit cards, overdrafts occupied 16% and micro loans – 12%.
Bank of Georgia started giving out mortgage loans in the national currency from February 2010. The first campaign gained huge popularity. The Bank has given out 100 loans. The total volume reached more than 4.5 million GEL.
In 2009 the total volume of business loans given out by Bank of Georgia was 880 million GEL. In the fourth quarter of 2009 the total business loan portfolio was raised by 16% compared with the previous quarter. In the fourth quarter of 2009 the largest amount of the loan portfolio was occupied by trading, with 32%, plural energetic – 9%, fast moving consumer goods – 14%, construction and development sector – 17%, manufacture and government sector – 12%, pharmacy and health service – 2% and 14% by other business sectors.
From the second part of 2009 Bank of Georgia actively started reducing interest rates on different types of loans and increasing limits on monthly crediting. The Bank reduced interest rates on micro, hypothec, auto and consumer loans. After November 2009 interest rates on micro loans reached 16%, mortgage loans – 14.5%, auto loans – 16% and consumer loans – 18%. Interest rates on all of the above-mentioned loans have returned to the pre war margin. The Bank also reduced interest rates on corporate loans and it varied from 16-18% to 14.5-16.5%.
During 2009 Bank of Georgia has three times reduced interest rates on deposits: at first from 0.25% to 0.5% in October and then from 0.75% to 1% in November, according to the types of deposits.
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