TBC Bank Group
Holding Company of JSC TBC Bank

Our Market

TBC Bank’s operations are focused on the Georgian Banking market with 99.6% of its total assets based in Georgia.

Georgia is situated at the strategically important crossroads where Europe meets Asia. The country has a long track record of resilient economic performance and a well-diversified economy. In 2016 economic growth averaged 2.7%, almost unchanged from the previous year’s 2.9% growth. in 2016 economic growth continued to be pressured by spillover effects from the economic difficulties in the immediate neighbors of Georgia ranging from the economic decline in Azerbaijan to political difficulties and currency depreciation in Turkey. Despite still lower than potential growth, Georgia remained among the best performers in the region, owing to its more diversified trade ties and sound economic policies.


Economic growth picked up in the beginning of 2017 with 5.0% real GDP growth for Q1 20171. Sharp recovery in exports of goods and tourism inflows driven by relative stability in the region was major factor behind the improvement in growth. Amendments in the tax code, which entered into force starting from the beginning of 2017 and made reinvested profit tax free, is also becoming additional positive factor to promote domestic as well as foreign investment and economic growth in the country over the medium term.


Concerns over the possible negative influence of profit tax reform on fiscal sustainability has been alleviated by number of steps that has been taken by the government, including the increase of excise taxes on petroleum, cars, tobacco and imposing stricter controls to current spending. New three-year program approved by IMF reinforces sustainability of public finance and supports Government’s plans on wide-ranging structural reforms in the spheres of education, road infrastructure and public administration.


In March 2017, EU ratified long awaited visa free regime for the citizens of Georgia which is an important milestone in EU-Georgia relations. This important step improves opportunities for Georgian businesses to better capture the benefits of free trade deal and also positively influences consumer sentiments in the country.


Transparent institutions, attractive business environment, significant potential in the areas of exports, tourism, transport, logistics and energy will enable Georgia to remain among the top performers among the CEE countries. For 2017 IMF expects 3.5% GDP growth, which is the highest among the peer countries.  


 Expected GDP Growth in CEE Countries  in 2017, %


 Source: Respective statistical offices and central banks


Regional Context

Economic slowdown over the last 2 years was primarily due to the deterioration of external demand for Georgian exports. By the end of 2016, most of the region countries posted positive growth figures, which was also reflected on the growth rate of Georgian exports. Following the two years of negative growth exports of goods from Georgia increased by 7.5% y/y In Q4 2016 and growth accelerated further to 30% y/y in Q1 2017.


Exports growth was driven by exports to CIS (+59% y/y) and EU (+44% y/y) markets in Q1 2017. Exports to other countries also increased albeit at a lower rate (+4.5% y/y).

FTA with China, country that entered top three exports destination for Georgian goods in 2016, is expected to enter into force in 2017. FTA with China will abolish all export tariffs for c. 95% of Georgian exports. Goods to benefit most from the FTA with China include traditional export products of food and beverages.


The dependence of Georgian exports on traditional markets in the CIS is gradually declining in favor of a more balanced geographical profile of exports that will further enhance the resilience of the Georgian economy toward any new global and regional shocks. Export dependence on the CIS market declined from 8.9% of GDP in 2014 to 5% of GDP in 2016. This reduces the sensitivity of the domestic economy to the developments in the CIS in the future




Sector Developments

Transport and Communications
One of the key competitive advantages of Georgia is its role as a transit and logistics hub for trade in goods and oil and gas transported from Central Asia and Caspian Sea to Europe and Turkey. Transport sector accounted for around 8% of in 2016. Infrastructure development is one of the key pillars of Government reform agenda. Starting from 2017 public capital investment is expected to increase by around 1% of GDP and accelerate further in the following three-year period, according to the Government’s infrastructure program. Reforms and investment in infrastructure have improved the country’s regional role in transporting oil and gas, as well as other commodities. Some of the major projects in this sector are reviewed below. 

Tbilisi-Baku-Kars Railway

Georgia’s role as a regional hub for transport and communications will be further strengthened by the Baku-Tbilisi-Kars railway, construction works are already 95% complete and official opening of the railway is slated for summer, 2017. Peak capacity of BTK railway will be 17 million tons of cargo. At the initial stage railway will serve 1 million passengers and 6.5 mln tons of cargo. BTK railway will establish continuous communication between EU and major Asian markets and will threefold shorten the time needed to transport goods from China to EU compared to currently operating routes through Iran or Russia.

BP Shah Deniz II

BP expects that the investment in the Shah Deniz II gas pipeline project will be USD 2 billion until 2018 in Georgia, and c. 20% of the investment will be spent via local contractors; First delivery of gas to turkey via new pipeline is scheduled by the second half of 2018.

Anaklia Deep Sea Port

A deep-Sea Port will be constructed in Anaklia, which will further facilitate the transit and logistical potential of Georgia. Government of Georgia earmarked GEL 100 mln for 2017 to invest in the development of railway pass and other communications to the construction site. the first stage project investment will amount to c. USD 500-700 million in the coming four years.



Georgia boosts significant potential of hydro energy. Given abundance of water resources, there is a vast potential for construction small to medium size HPPs as well as several large scale projects. The sector attracted high FDIs in 2014, 2015 and 2016- US$190 million US$ 124 mln and US$203 million respectively (which was around 11%, 8% and 12% of total FDIs).


One of the priorities for the Government is to promote the development of Georgia’s power generation capacity, which will enhance Georgia’s energy self-sufficiency and the availability of affordable energy. Neskra HPP is a large scale project with total estimated investment of USD 1 billion, the project is financed by EBRD, ADB, Export-Import Bank of Korea in cooperation with the Georgian Partnership Fund and is planned to be completed by 2019. Once completed, Nenskra HPP is expected to fill the gap between the supply and demand of electricity in Georgia and reduce dependence on imported energy sources, especially during winter. 


According to its strategy, the Georgian Government will actively support tourist infrastructure, new tourist product offerings, and an increase in service quality levels. Apart from leisure tourism, the government also aims to increase MICE tourism and expect around 8 million international arrivals by 2019, hence the need for new infrastructure projects. 


Tourism remains one of the fastest growing sectors of the economy, over 2013-2016 growth of the number of international tourists averaged c. 10% annually. Over the same period, share of tourism related industries in the economy went up from 6.5% of GDP to 7.6% of GDP. Tourism inflows posted CAGR of 8% over 2013-2016 reaching US$ 2.2 bn or 15.1% of GDP as of 2016. 


Population: 3.7 mn2

GDP (FY 2016 / 2015): USD 14.3 bn / USD 14.0 bn3

GDP per capita (FY 2016 / 2015): USD 10.0k / USD 9.6k4

Average real GDP growth (2011-2016): 4.5%3



Currency: Georgian Lari (GEL)
Exchange rates (31 March 2017): USD/GEL: 2.45; EUR/GEL: 2.63


Fitch: BB-/Stable
Moody's: Ba3/Stable

Recent achievements 

Among the friendliest Tax Regime globally 5

#16 globally on Ease of Doing Business 6

#8 on starting a Business7

One of the most transparent countries in the world8


For additional information please see Ministry of Finance of Georgia web site www.mof.ge


1 Initial estimates of growth by Geostat

2 Population is based on Geostat figures.

3 GDP, average GDP and real GDP growth are based on Geostat figures.

4 PPP, IMF, WEO, October 2016 update.

5 22th globally on Paying Taxes, WB, doing business report 2017.

6 Doing Business Report 2017.

7 Doing Business Report 2017.

8 Transparency International 2013 Global Corruption Barometer.

9 GDP Composition based on Geostat figures.


Last updated on 22 February 2017.

% of GDP unless otherwise indicated  2016 2015 2014 2013 2012 2011 2010
Real GDP (YoY) 2.7 2.9 4.6 3.4 6.4 7.2 6.2
Nominal GPD (bn USD) 14.3 14.0  16.5 16.1 15.8 14.4 11.6
GDP per capita, PPP (USD) 10,043.8 9,600.8  9.210.2 8,526.0 8,002.4 7,286.9 6,568.3
Unemployment rate (%)


12.0 12.4 14.6 15.0 15.1 16.3
CPI inflation (YoY, pa) 2.2 4.0 3.1 -0.5 -0.9 8.5 7.1
CA balance


-12.0 -10.6 -5.8 -11.7 -12.8 -10.2
Tourism inflows 15.1  13.8 10.8 10.7 8.9 6.6 5.7
FDI 11.5  11.2 10.7 5.8 5.8 7.7 7.0
Fiscal deficit 4.1  3.7 3.2 2.6 2.8 3.6 6.7
Public debt


41.4 35.5 34.7 34.8 36.5 42.4
Loans to the Economy 55.7  50.4 44.5 39.0 33.3 31.6 30.2
Financial sector assets 88.9  79.2 70.7 64.3 54.9 52.1 50.9
USD/GEL, pa 2.37  2.27 1.77 1.66 1.65 1.69 1.78


Source: NBG, Geostat, MOF, IMF