TBC Bank to Focus on Electronic Products This Year

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The FINANCIAL — According to the growth of financial highlights, TBC Bank overtook the country’s banking sector growth last year.


The net profit of 2011 totaled the sum of 91.6 million GEL which exceeds the same figures of 2010 by 42.2 million GEL (84 percent). The net profit of 2010 totaled the sum of 49.4 million GEL.

“For that reason the Bank’s market shares have been increased as well,” Vakhtang Butskhrikidze, General Director of TBC Bank, told The FINANCIAL.  “We succeeded in the side of Cost-to-Income coefficient which was reduced from 54% to 50% last year in comparison with 2010. This is a good trend indicator,” he added.

Q. What were the capital changes in TBC Bank?

A. The capital of TBC Group increased by 91.5 million GEL, which means growth of 24 percent which amounted to 469 million GEL. The increase of capital was caused by the growth of retained earnings which had increased by 78.4 million GEL (by 64 percent) during the year. Increased capital affected the tier I capital and the total capital adequacy ratio which totaled 17.9 percent and 23.8 percent.

All of this has been achieved under difficult circumstances such as the financial crisis in the West and difficulties in attracting financial resources from foreign capital markets. In such conditions we aimed to set our vision and strategy according to environmental factors. We have emphasized more on attracting local deposits and achieved quiet ambitious plans in this direction. In particular, our deposit portfolio increased by 45 percent, meaning it increased by 615 million GEL and had reached 2 billion GEL at the end of the year. As for the loan portfolio, it increased by 530 million GEL (36 percent). The total amount of the loan portfolio reached 2 billion GEL by the end of 2011. During the year, the assets of TBC Bank increased by 43 percent and totaled 3.3 billion GEL at the end of the year.

Q. How much has the market share increased?

A. It is very important for us that TBC Bank historically owns the largest market share on the retail deposits market. Last year we reinforced this position and our market share increased by 34 percent. As for other rates, our market share of assets amounted to 26.6 percent and in loans – 27.6 percent.

Q. What are the achievements and recognitions of TBC Bank on the international market?

A. The successful activities of the Bank did not remain without attention. TBC Bank was named the most successful bank in Georgia by Euromoney. Financial Times Group and its magazine The Banker, which calculates banks’ rankings worldwide, recognized TBC Bank as the Best Bank in Georgia. Global rating agency Fitch ratings improved the sustainability rating of TBC Bank from B- up to B+.

TBC Bank is the “Best Georgian Bank by Monetary Transfers” according to the data of Deutsche Bank and Commerzbank as well.

These are very important international recognitions and I am glad that such recognitions have increased in recent years. This demonstrates the Bank’s successful development process.

Q. How successful was the year 2011 for other companies in TBC Group?

A. 2011 was a success for TBC Bank’s other subsidiary companies including TBC Leasing. TBC Leasing increased its market share by 18.7 percent in 2011. Today it holds 61 percent of the leasing market.

TBC Credit, which operates in Azerbaijan, increased its activities by 35 percent and its credit portfolio by 31 percent last year.

TBC Invest’s deposit portfolio grew by 15 million USD in 2011. It is represented in Israel by TBC Bank. 

Q. What are the bank’s future plans for corporate clients?

A. The department of corporate banking service in TBC Bank is oriented at serving large companies and state and international organizations. Experienced senior bankers hold various industrial sector portfolios. They promote universal service and give professional advice to the corporate clients in this field.

Last year the corporate deposit portfolio increased by 74.5 percent. The Bank’s market share in this direction amounted to 24.9 percent. The volume of corporate loans increased by 40.8 percent and market share reached to 27.5 percent. The corporate sector will continue to actively lend in 2012. The Bank is going to use the opportunities in healthcare, agriculture, food products, energy, and consumer sectors.

Q. Why did you decide to enter the micro business field and purchase Bank Constanta’s shares?

A. One of the main achievements of TBC Bank was purchasing an 80 percent controlling stake of Bank Constanta. It was a strategically important decision for us. As a result we hold a strong position in the market of crediting micro business. Micro business is quite an interesting and prospective direction.

Bank Constanta is the fastest growing financial institute in Georgia. It operates successfully in the whole of Georgia including the regions and is one of the leading banks in the small business lending market. It has considerable experience and tradition in agriculture lending. Besides corporate, middle business and private sectors TBC Bank now operates in micro business as well. In cooperation with Bank Constanta, we are expanding retail financing in those regions where TBC Bank was not represented before.

As a result of this transaction, Constanta increased its banking assets by 78 percent and credit portfolio by 71 percent.

Q. What is your strategy for 2012?

A. Our main focus will be on our new strategy in 2012. By offering new products we try to satisfy the increased requirements of our clients and provide them with maximum comfort by using our products and services. We plan to implement new technological and high quality products. We will focus on electronic products this year. These products will be sold remotely, by using high technologies.

We have already implemented a new internet banking system. This is a totally new development in the Georgian banking system. The new internet banking will be on a level of that of any western banks. 

This is the first part of our project concerning a multichannel service and the best model of sales in the regions. As a result of the project the multichannel service of TBC Bank will be the best one in the region, including Turkey. It will be the best in terms of function and design. It will include internet and mobile banking, call centre, ATM and quick service terminals. And this will result in the Bank being even closer to its clients.



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