The FINANCIAL — Despite the high level of competition in the Georgian banking sector and reduced economic development in the country, BasisBank, Hualing Group Member, has had asset growth of 71% this year.
The Bank attracted a new credit line from Black Sea Trade and Development Bank (BSTDB) amounting to USD 6 million. The BSTDB facility aims to finance trade transactions between Georgia and other BSTDB member countries, as well as Georgian exports to all countries. The Bank has started reducing interest rates on various credit products and promises to continue in this direction.
“Asset growth of the banking sector as a whole amounted to 10%; in our case it amounted to 71%. We have equal results in the direction of credit portfolio. Average growth of the sector was 9% and in our case – 74%. We increased our loan portfolio as well as assets seven times more rapidly. This indicates that we are offering the right products to our customers and at the same time, we are also trying to attract those companies which have been stably operating and have gathered experience of working on the market. We will continue with this line of development and hope that further results will not be far behind,” David Tsaava, General Director at BasisBank, Hualing Group Member, told The FINANCIAL.
BasisBank has been operating on the Georgian market for 20 years. According to Tsaava, during that time many banks have been established whose names can be hard to recall now.
Established in 1993, Basisbank is owned by Xinjiang Hualing Industry & Trade (Group) Co, Mr. Zurab Tsikistavi, a Georgian private shareholder and founder of the Bank, and the European Bank for Reconstruction and Development (EBRD). The Bank provides a broad range of banking services to retail and corporate clients through a network of 16 branches in Georgia. Basisbank is rated B by Fitch. As well as BSTDB, Basisbank cooperates with the World Bank and other international development institutions in agribusiness and SME sector development in Georgia.
The current deposit portfolio of the Bank amounts to GEL 200 million.
“For this reason BasisBank has been occupying its niche on the SME market. We were focusing on the development and support of medium-sized businesses. At the same time, we are trying to be very active in both the retail and corporate segment. The Bank is focused on encouraging local production and SME business development. A credit line provided by BSTDB gives us the opportunity to be actively involved in financing international trade as well,” said Tsaava.
BasisBank offers trade financing with a 9.8% interest rate. This is one of the lowest figures on the market.
Tsaava agreed that the SME sector is still less developed in Georgia, however he is optimistic that given proper planning and support it will play a big role in the national economy.
“The SME sector is slowly starting to gain its share and have an increasingly important role in the economy. With the proper support and determined work the SME sector will play an important role in the Georgian economy,” he said.
BSTDB provided its first credit line to BasisBank in 2012, which amounted to USD 4 million.
“BSTDB’s continued cooperation with Basisbank is a demonstration of support for Georgian trade and development. Basisbank successfully utilized the first USD 4 million Trade Finance credit line provided by BSTDB in 2012 and has been a reliable BSTDB partner,” said Mustafa Boran, BSTDB Vice President Banking.
BSTDB launched its Trade Finance Program in Georgia in 2000 and since then has provided about USD 100 million to over 140 local companies through partner banks in Georgia.
“Our priority in Georgia is trade finance and SMEs. We do not have any limits on issuing finances for Georgia and next year, in 2014, I do not think that we will reduce the volume of finances to Georgia,” said Boran.
“Trade has great potential in Georgia, together with SME and microfinance. By financing these directions Georgian banks will have a positive impact on the economy,” said Boran.
According to Tsaava, with the new investment the Bank has the opportunity to offer more innovative and exciting products to its customers.
“Recently Megobarati and Geocell visa card holders were offered a credit line with an interest rate reduced from 15% to 10%. This was our response to their loyalty and we plan to continue such campaigns in the future,” said Tsaava.
BasisBank has reduced interest rates on consumer loans and currently offers them at 12%.
“We are trying to encourage loans taken out in Georgian Lari. We offer the lowest interest rate on mortgage loans. It starts from 7.9% and varies depending on the refinancing rate,” Tsaava told The FINANCIAL.
Discussion about this post