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JSC Bank of Georgia (BGEO)

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Thursday 31 May, 2007

JSC Bank of Georgia

1st Quarter Results

Bank of Georgia
                  

1.70 GEL/US$ Q1 2007 period end
1.71 GEL/US$ Q1 2007 average
1.83 GEL/US$ Q1 2006 period end
1.82 GEL/US$ Q1 2006 average

           JSC BANK OF GEORGIA ANNOUNCES CONSOLIDATED Q1 2007 RESULTS

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Millions, unless otherwise noted                          Q1 2007        Growth
                                                                          y-o-y
                                                                             (1)
Bank of Georgia (Consolidated, IFRS Based)               Unaudited
                                                         GEL         US$

Total Operating Income (Revenue)(2)                    41.1        24.2   131.2%
Recurring Operating Costs                              16.5         9.7    73.8%
Normalized Net Operating Income(3)                     24.5        14.4   197.4%
Pre-Bonus Result                                       22.5        13.2   229.6%
Net Income                                             13.7         8.0   229.2%
Consolidated EPS (Basic), GEL & US$(4)                 0.54        0.32    97.3%
Consolidated EPS (Fully Diluted), GEL & US$(5)         0.50        0.30    91.6%
ROAA(6), Annualized                                     3.8%
ROA, Annualised                                         3.3%
ROAE(7), Annualised                                    14.4%
ROE, Annualised                                        14.2%
*T

Bank of Georgia (LSE: BGEO, GSE: GEB), the leading Georgian universal bank,
announced today Q1 2007 consolidated results (IFRS Based, unaudited, derived
from management accounts), reporting record Net Income of GEL 13.7 million (up
229.2% y-o-y), or 0.54 per share (up 97.3% y-o-y).

(1) Compared to the same period in 2006; growth calculations based on GEL.

(2) Revenue includes Net Interest Income and Net Non-Interest Income.

(3) Normalized for the Net Non-Recurring Costs.

(4) Basic EPS equals Net Income of the period divided by weighted average
outstanding shares for the period.

(5) Fully Diluted EPS equals Net Income of the period divided by the number of
outstanding ordinary shares as of the period end plus number of ordinary shares
in contingent liabilities.

(6) Return on Average Total Assets equals annualised Net Income for the period
divided by the average Total Assets for the period.

(7) Return on Average Total Shareholders' Equity equals annualised Net Income
for the period divided by the average Total Shareholders' Equity for the period.

About Bank of Georgia

Bank of Georgia, a leading universal Georgian bank with operations in Georgia
and Ukraine, is the largest bank by assets, loans deposits and equity in
Georgia, with 33% market share by total assets (all data according to the NBG as
of March 31 2007). The major component of the Galt & Taggart Index, the bank has
103 branches and over 450,000 retail and more than 50,000 corporate current
accounts. The bank offers a full range of retail banking and corporate and
investment banking services to its customers across Georgia. The bank also
provides a wide range of corporate and retail insurance products through its
wholly-owned subsidiary, BCI, as well as asset & wealth management services.

Bank of Georgia has, as of the date hereof, the following credit ratings:

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Standard & Poor's   'B+/B'                          Stable
Moody's             'B3/NP' (FC) & 'Baa3/P-3' (LC)  Stable
FitchRatings        'B/B'                           Stable
*T

For further information, please visit www.bog.ge/ir or contact:

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Lado Gurgenidze                      Irakli Gilauri                Macca Ekizashvili
Chairman of the Supervisory Board    Chief Executive Officer       Head of Investor Relations
+995 32 444 103                      +995 32 444 109               +995 32 444 256
lgurgenidze@bog.ge                   igilauri@bog.ge               ir@bog.ge
*T

This news report is presented for general informational purposes only and should
not be construed as an offer to sell or the solicitation of an offer to buy any
securities. Certain statements in this news report are forward-looking
statements and, as such, are based on the managements current expectations and
are subject to uncertainty and changes in circumstances.

The financial information as of the first quarter 200 and first quarter 2006
contained in this news report is unaudited and reflects the best estimates of
management. The bank's actual results may differ significantly from the amounts
reflected herein as a result of various factors.

Q1 2007 Summary

The bank's Q1 2007 Total Operating Income (Revenue) grew 131.2% y-o-y to GEL
41.1 million, driven by Net Interest Income of GEL 26.0 million, up 149.1% y-o-y
and Net Non-Interest Income of GEL 15.0 million, up 105.6% y-o-y. Recurring
Operating Costs of GEL 16.5 million grew by 73.8% y-o-y at a significantly lower
rate than Revenue. This improvement in operating leverage resulted in a 197.4%
y-o-y growth of Normalised Net Operating Income (''NNOI') to GEL 24.5 million.
Pre-Bonus Result ('PBR'), another key metric observed by the management, reached
GEL 22.5 million in Q 1 2007, up 229.6% y-o-y.

The bank's consolidated Total Assets reached GEL 1.6 billion by Q1 2007, up
34.6% YTD. Its corporate, retail and private banking Gross Loans To Clients grew
by 116.2%, 134.8% and 126.0% y-o-y, respectively, to GEL 450.9 million, GEL
336.3 million and GEL 29.8 million, respectively, contributing to the 125.4%
y-o-y growth of Net Loans To Clients to GEL 814.0 million, up 17.3% YTD. The
balance sheet growth in Q1 2007 resulted in the market share of approximately
33% and 28% by total assets and gross loans, respectively, compared to the
respective 28% and 27% market shares at the year end.(1)

In February 2007, the bank completed a landmark transaction as it issued US$200
million of debut Regulation S five year unsecured senior Eurobonds, the first
ever international bond offering from Georgia. The Eurobond, issued at par,
carries a 9% interest rate per annum. The issue was rated 'B+'/Stable by S&P,
'Ba2'/Stable by Moody's and 'B'/Stable by Fitch. In addition, in Q1 2007, the
bank attracted US$12.5 million seven year loan from FMO(9) for the financing of
its rapidly growing SME loan book. Largely due to the above-mentioned
transactions, the bank's non-deposit funding base grew 136.0% YTD to GEL 527.5
million by 31 March 2007. Total Deposits (GEL 637.8 million at the end of Q1
2007) increased by 13.8% YTD and amounted to an approximately 25% market share,
the largest in the Georgian banking sector.

As of 31 March 2007, the bank's consolidated ROAE amounted to 14.4 %, while ROAA
reached 3.8%. The equity book value per share stood at GEL 15.3 by 31 March
2007, up 137.1% y-o-y (up 2.6% YTD).

The bank also announced certain changes in the organisation structure. The
composition of CIB, RB, Insurance and Corporate Center Strategic Business Units
('SBUs') has not changed, and the bank continues its segment reporting along
these lines. The Asset & Wealth Management ('A&WM') SBU has been separated into
the following three Business Units ('BUs'):

    --  Galt & Taggart Securities ('GTS') BU, comprising the brokerage,
        investment banking and related subsidiaries of the bank, domiciled in
        Georgia, Ukraine and elsewhere;

    --  Wealth Management ('WM') BU, the successor to the private banking unit
        of the former A&WM, which will be focused solely on the private banking
        services; and

    --  Asset Management ('AM') BU, comprising the bank's asset management
        activities. AM currently consists of Galt & Taggart Capital, (GSE: GTC),
        the private equity vehicle investing in consumer goods, retail, business
        support services and real estate sectors, and BCI Pension Fund.

(8) Market share data are derived from the information published by the National
Bank of Georgia (www.nbg.gov.ge) and represent an aggregation of standalone
financial information filed by Georgian banks.

(9) Nederlandse Financierings-Maastschappij voor Ontwikkelinglanden N.V.

(10) In the process of merging

Strategic Business Unit and Business Unit Overview

Corporate & Investment Banking (CIB)

Discussion Of Results

Allocated Revenues grew 122.7% y-o-y, impacted by the growth in Net Interest
Income and Net Non Interest Income. Operating leverage of CIB has improved, as
the growth rate of allocated Recurring Costs (52.0% y-o-y, driven primarily by
the headcount expansion and higher performance-based compensation) lagged the
growth rate of the allocated Revenues. PBR grew 146.3%% y-o-y to GEL 10.5
million, contributing 46.9% to the consolidated PBR. Earnings grew 178.1% y-o-y,
contributing 54.7% to the consolidated Net Income. Gross Loans grew 14.6% YTD to
GEL 450.9 million, driven by increased lending to corporate clients and rapid
growth of the SME loan book. Allocated Client Deposits grew 10.2% YTD to GEL
311.6 million, primarily due to the growth of Current Account Balances.
Allocated Total CIB Assets amounted to GEL 693.1 million, up 29.5% YTD, while
allocated Total CIB Liabilities reached GEL 604.0 million.

Highlights

    --  Won the tender to service the Georgian Oil and Gas Corporation ('GOGC')
        on an exclusive basis for five years. GOGC, which represents the state
        in all oil and gas product sharing agreements and is a dominant player
        in gas transportation, is one of the top corporate clients in the
        country.

    --  Increased the number of corporate clients using the bank's payroll
        services from 480 at the end of 2006 to over 540 by the end of Q1 2007.
        By 31 March 2007, the number of individual clients serviced through the
        corporate payroll programs administered by the bank increased from
        approximately 83,500 at the beginning of the year to over 100,000.

    --  More than 5,700 legal entities opened accounts at the bank in Q1 2007,
        bringing the total to 52,815.

Retail Banking (RB)

Discussion Of Results

Allocated Revenues grew 149.2% y-o-y, impacted by the growth in Net Interest
Income and Net Non Interest Income. Operating leverage of RB has improved, as
the growth rate of allocated Recurring Costs (52.9% y-o-y, driven primarily by
the branch and headcount expansion and higher performance-based compensation)
lagged the growth rate of the allocated Revenues. PBR grew 414.0% y-o-y to GEL
9.9 million, contributing 44.1% to the consolidated PBR. Earnings grew 567.9%
y-o-y, contributing 51.4% to the consolidated Net Income. Gross Loans grew 19.4%
YTD to GEL 336.3 million, a result of an expanded customer reach through the
established customer acquisition channels and innovative product roll-outs.
Client Deposits grew 13.0% YTD to GEL 232.4 million, driven primarily by the
growth of Current Account Balances and Time Deposits. Allocated Total RB Assets
amounted to GEL 518.7 million, up 38.9% YTD, while allocated Total RB
Liabilities reached GEL 450.5 million.

Highlights

    --  Increased the number of retail current accounts from approximately
        420,000 at the beginning of the year to approximately 450,000 by 31
        March, 2007.

    --  Increased the number of branches (service centers) from 100 at the
        beginning of the year to 103 by 31 March 2007.

    --  The purchase of commercial space previously rented by two existing
        branches resulted in the implied cost savings of GEL 0.2 million per
        annum.

    --  Bought or leased premises for six new branches, which are currently
        being fitted out and are expected to be operational by YE 2007.

    --  Commenced the marketing of credit cards (primarily to existing clients,
        for now), resulting in over 6,000 credit cards outstanding by 31 March
        2007.

    --  Increased the number of debit cards outstanding from approximately
        285,000 at the beginning of the year to approximately 337,000 by the end
        of Q1 2007

    --  Continued to make gains in merchant acquiring as the installed POS
        terminal footprint grew to 497.

    --  Total number of cards in service by Georgian Card grew from 370,000 at
        the beginning of the year to 456,000 by 31 March 2007, while the number
        of transaction authorisations processed by Georgian Card grew 164% y-o-y
        to approximately 2.9 million (compared to approximately 1.1 million in
        Q1 2006).

    --  Continued investing in the electronic banking channels, as the number of
        ATMs grew to 146 by 31 March 2007 (up from 124 at the beginning of the
        year), number of mobile banking users reached 16,000, and number of
        registered Internet banking users grew 38.8% YTD to 51,870 (732.1%
        growth y-o-y).

    --  POS express consumer lending initiated by the bank in 2006 to complement
        the branch-based general-purpose consumer lending, resulted in the 545
        express loan POS contracts signed (of which 358 outlets were served by
        31 March 2007. POS express loan originations have reached GEL 12.8
        million in Q1 2007, while POS express loans outstanding amounted to GEL
        24.0 million at the end of Q1 2007.

    --  Launched in March 2007 a joint project with Nokia and Magti (the largest
        mobile phone operator in Georgia). The project involves selling 3G Nokia
        handsets on credit through Bank of Georgian's point-of-sale express
        lending network, with Magti bundling in a certain amount of free 2G and
        3G services.

    --  Stepped up mortgage loan originations to GEL 29.6 million in Q1 2007 (up
        360.9% y-o-y) resulting in mortgage loans outstanding by 31 March 2007
        of GEL 80.8 million, (up 26.8% YTD).

    --  Car loan originations of GEL 3.3 million resulted in car loans
        outstanding by 31 March 2007 of GEL 11.5 million, (up 17.6% YTD).

Insurance

Discussion Of Results

Pro forma Standalone Revenues of Aldagi BCI, the bank's wholly-owned insurance
subsidiaries which are in the process of merging, grew 130.6% y-o-y, impacted by
the growth in both corporate and consumer lines of business, with pro forma
standalone Gross Premiums Written up 112.1% y-o-y to GEL 8.7 million. Pro forma
standalone Operating Costs were GEL 1.5 million, up 110.9% y-o-y, and pro forma
standalone Net Claims Incurred were GEL 0.9 million, up 445.9% y-o-y, reflecting
the growth of the business. Pro forma PBR grew 14.7% y-o-y to GEL 0.6 million,
contributing 2.7% to the consolidated PBR. Pro forma earnings grew 15.8% y-o-y,
contributing 2.9% to the consolidated Net Income. Total Insurance Assets
amounted to GEL 46.5 million, while Total Insurance Liabilities reached GEL 41.7
million.

Highlights

    --  Continued the integration of Aldagi, acquired by BCI in December 2006.
        The pro forma combined market share of Aldagi and BCI by Gross Premiums
        Written amounted in Q1 2007 to approximately 41%, unchanged from 2006.

Corporate Center

Allocated Revenues grew 65.1% y-o-y to GEL 3.8 million, impacted mainly by
foreign currency-related transactions. The growth of allocated Recurring Costs
of 66.8% y-o-y , to GEL 2.5 million, lagged the allocated Revenues, resulting in
the PBR of GEL 0.4 million, which contributed 1.8% to the consolidated PBR.
Allocated Total CC Assets amounted to GEL 257.2 million, representing 15.7% of
the consolidated Total Assets. Allocated Total CC Liabilities reached GEL 47.8
million, representing 3.8% of the consolidated Total Liabilities.

Wealth Management (WM)

Discussion Of Results

Allocated Revenues grew 256.1% y-o-y, impacted by the growth of Net Interest
Income (driven primarily by the growth of the Private Banking loan book) to GEL
0.8 million in Q1 2007. Allocated Recurring Costs of GEL 0.3 million grew 32.1%
y-o-y. PBR grew 4070.8% y-o-y to GEL 0.3 million, contributing 1.4% to the
consolidated PBR. Earnings grew 4623.6% y-o-y, contributing 1.7% to the
consolidated Net Income. Gross Loans grew 32.1% YTD to GEL 29.8 million, while
Client Deposits decreased 17.0% YTD to GEL 54.3 million. Allocated Total WM
Assets amounted to GEL 45.8 million, up 285.9% YTD, while allocated Total WM
Liabilities reached GEL 73.6 million, up 27.2% YTD.

Highlights

    --  The number of Private Banking clients grew from 873 at the beginning of
        the year to 943 at the end of Q1 2007.

    --  Private Banking mortgage loan originations of GEL 4.2 million (up 34.6%
        y-o-y) resulted in mortgage loans outstanding by 31 March 2007 of GEL
        20.4 million, up 18.2% YTD.

    --  Private Banking car loan originations of GEL 0.6 million resulted in car
        loans outstanding by 31 March 2007 of GEL 2.5 million, up 11.5% YTD.

Galt & Taggart Securities

Discussion Of Results

The growth of standalone Revenues of Galt & Taggart Securities (Georgia) was
driven primarily by increases in commissions from brokerage, (GEL 0.8 million,
up 1212% y-o-y) and securities trading gains (GEL 0.4 million, up 614.0% y-o-y).
Recurring Operating Costs increased 964.4% y-o-y to GEL 0.6 million, largely due
to the headcount expansion at Galt & Taggart Securities Ukraine. The lower
growth rate of the Operating Costs compared to the Revenue growth rate (GEL 1.5
million in Q1 2007, up 909.1% y-o-y), resulted in the y-o-y increase of 660.0%
of the NNOI to GEL 0.8 million. The PBR of GEL 0.8 million in Q1 2007, (up
662.1% y-o-y, contributed 3.6% to the consolidated PBR. Earnings grew 281.3%
y-o-y, contributing 2.3% to the consolidated Net Income. Total Galt & Taggart
Securities Assets amounted to GEL 33.8 million, up 69.0% YTD, while Total Galt &
Taggart Securities Liabilities reached GEL 13.2 million.

Highlights

    --  Sergiy Lesyk joined as the Kyiv-based Global Head of Equities.

    --  Dmitry Kasatkin joined as the London-based Global Head of Investment
        Banking.

    --  Assets Under Custody grew 45% YTD to GEL 492.6 million as of 31 March
        2007.

    --  Proprietary book grew 153% YTD to GEL 19.3 million by 31 March 2007.

    --  Galt & Taggart Securities (Georgia) continued to hold the leading
        position by the equities trading volume in Georgia, with an
        approximately 90% market share.

    --  Galt & Taggart Securities (Georgia) successfully handled a rights issue
        of Galt & Taggart Capital.

Asset Management

Highlights

    --  The market capitalization of Galt & Taggart Capital reached GEL 118
        million, an increase of 120% YTD and an increase of 334% since the
        company was admitted to trading on the Georgian Stock Exchange in
        November 2006.

    --  Galt & Taggart Capital made several real estate investments, invested in
        several startup businesses, and purchased a 32% equity interest in
        Teliani Valley, a leading Georgian winery.

    --  Assets Under Management at the Aldagi BCI Pension Fund grew 218% y-o-y
        to GEL 0.7 million at the end of Q1 2007, while the number of Aldagi BCI
        Pension Fund members stood at 2,574 at the end of Q1 2007 up from 1,163
        members in Q1 2006.

Comments

'I am very pleased with the Q1 2007 results. Apart from giving the country its
first-ever Eurobond benchmark, the bank capitalized aggressively on its key
competitive advantages - superior retail distribution network and superior
access to funding - to deliver record quarterly earnings and gain market share',
commented Lado Gurgenidze, Chairman of the Supervisory Board.

                                 SEGMENT RESULTS

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                                     Change y-o-y     Q1 2007      Share     Q1 2006       Share

Total Operating Income (Revenue)
------------------------------------------------------------------------------------------------
Corporate & Investment Banking             122.7%     13,734       33.5%      6,166        34.7%
Retail Banking                             149.2%     18,783       45.8%      7,538        42.5%
Wealth Management                          256.1%        825        2.0%        232         1.3%
Galt & Taggart Securities                  766.3%      1,417        3.5%        164         0.9%
Asset Management                          2789.6%        317        0.8%         11         0.1%
Insurance                                   62.2%      2,187        5.3%      1,348         7.6%
Corporate Center                            65.1%      3,791        9.2%      2,297        12.9%
------------------------------------------------------------------------------------------------
Total Operating Income (Revenue)           131.2%     41,055      100.0%     17,756       100.0%
------------------------------------------------------------------------------------------------

Total Recurring Operating Costs
------------------------------------------------------------------------------------------------
Corporate & Investment Banking              52.0%      2,426       14.7%      1,596        16.8%
Retail Banking                              52.9%      8,315       50.5%      5,438        57.2%
Wealth Management                           32.1%        280        1.7%        212         2.2%
Galt & Taggart Securities                  964.4%        604        3.3%         57         0.6%
Asset Management                              NMF        897        5.4%          -          NMF
Insurance                                  110.9%      1,543        9.4%        731         7.7%
Corporate Center                            66.8%      2,460       14.9%      1,475        15.4%
------------------------------------------------------------------------------------------------
Total Recurring Operating Costs             73.8%     16,526      100.0%      9,509       100.0%
------------------------------------------------------------------------------------------------

Pre-Bonus Result
------------------------------------------------------------------------------------------------
Corporate & Investment Banking             146.3%     10,540       46.9%      4,280        62.8%
Retail Banking                             414.0%      9,918       44.1%      1,929        28.3%
Wealth Management                         4070.8%        319        1.4%          8         0.1%
Galt & Taggart Securities                  662.1%        812        3.6%        107         1.6%
Asset Management                              NMF       (127)      -0.6%         11         0.2%
Insurance                                   14.7%        609        2.7%        531         7.8%
Corporate Center                              NMF        405        1.8%        (46)       -0.7%
------------------------------------------------------------------------------------------------
Pre-Bonus Result                           229.6%     22,475      100.0%      6,819       100.0%
------------------------------------------------------------------------------------------------

Net Income
Corporate & Investment Banking             178.1%      7,471       54.7%      2,686        64.7%
Retail Banking                             567.9%      7,027       51.4%      1,052        25.3%
Wealth Management                         4623.6%        226        1.7%          5         0.1%
Galt & Taggart Securities                  281.3%        317        2.3%         83         2.0%
Asset Management                              NMF       (156)      -1.1%         11         0.3%
Insurance                                   15.8%        401        2.9%        346         8.3%
Corporate Center                              NMF     (1,623)     -11.9%        (33)       -0.8%
------------------------------------------------------------------------------------------------
Net Income                                229.2 %     13,663      100.0%      4,151       100.0%
------------------------------------------------------------------------------------------------

Basic EPS Contribution
------------------------------------------------------------------------------------------------
Corporate & Investment Banking              66.7%       0.30       54.7%       0.18        64.7%
Retail Banking                             300.4%       0.28       51.4%       0.07        25.3%
Wealth Management                         2732.0%       0.01        1.7%     0.0003         0.1%
Galt & Taggart Securities                  128.6%       0.01        2.3%       0.01         2.0%
Asset Management                          -950.5%      (0.01)      -1.1%      0.001         0.3%
Insurance                                  -30.5%       0.02        2.9%       0.02         8.3%
Corporate Center                              NMF      (0.06)     -11.9%      (0.00)       -0.8%
------------------------------------------------------------------------------------------------
Total                                       97.3%       0.54      100.0%       0.27       100.0%
------------------------------------------------------------------------------------------------
*T

                             SEGMENT RESULTS CONT'D

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                                 Change y-o-y       Q1 2007      Share        Q1 2006      Share
Total Assets
------------------------------------------------------------------------------------------------
Corporate & Investment Banking          114.4%     693,108       42.4%       323,296       51.0%
Retail Banking                          138.3%     518,651       31.8%       217,622       34.4%
Wealth Management                       122.8%      45,765        2.8%        20,539        3.2%
Galt & Taggart Securities               413.2%      33,759        2.1%         6,578        1.0%
Asset Management                           NMF      38,629        2.4%           200        0.0%
Insurance                               359.0%      46,454        2.8%        10,121        1.6%
Corporate Center                        366.0%     257,159       15.7%        55,179        8.7%
------------------------------------------------------------------------------------------------
Total Assets                            157.8%   1,633,525      100.0%       633,535      100.0%
------------------------------------------------------------------------------------------------

Loans to Clients, Gross
Corporate & Investment Banking          116.2%     450,866       54.0%       208,562       54.6%
Retail Banking                          134.8%     336,253       40.3%       143,205       37.5%
Wealth Management                       126.0%      29,757        3.6%        13,164        3.4%
Galt & Taggart Securities                  NMF           -        0.0%             -        0.0%
Asset Management                           NMF           -        0.0%             -        0.0%
Insurance                                  NMF           -        0.0%             -        0.0%
Corporate Center                          7.5%      18,464        2.2%        17,168        4.5%
------------------------------------------------------------------------------------------------
Total Loans to Clients                  118.6%     835,339      100.0%       382,099      100.0%
------------------------------------------------------------------------------------------------

Total Liabilities
------------------------------------------------------------------------------------------------
Corporate & Investment Banking          115.7%     603,994       48.4%       280,034       52.4%
Retail Banking                          134.0%     450,539       36.1%       192,519       36.1%
Wealth Management                       302.7%      73,552        5.9%        18,266        3.4%
Galt & Taggart Securities               136.3%      13,161        1.1%         5,570        1.0%
Asset Management                       8760.9%      17,456        1.4%           197        0.0%
Insurance                               491.3%      41,744        3.3%         7,060        1.3%
Corporate Center                         57.4%      47,787        3.8%        30,361        5.7%
------------------------------------------------------------------------------------------------
Total Liabilities                       133.7%   1,248,233      100.0%       534,007      100.0%
------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------
Client Deposits
Corporate & Investment Banking           55.9%     311,603       51.7%       199,898       56.2%
Retail Banking                           69.3%     232,392       38.6%       137,256       38.6%
Wealth Management                       310.5%      54,295        9.0%        13,228        3.7%
Galt & Taggart Securities               -28.3%       3,909        0.6%         5,453        1.5%
Asset Management                           NMF           -        0.0%             -        0.0%
Insurance                                  NMF           -        0.0%             -        0.0%
Corporate Center                           NMF           -        0.0%             -        0.0%
------------------------------------------------------------------------------------------------
Total Client Deposits                    69.2%     602,199      100.0%       355,835      100.0%
------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------
Book Value Per Share              Change y-o-y Contribution      Share   Contribution      Share
------------------------------------------------------------------------------------------------
Corporate & Investment Banking           26.2%        3.53       23.1%          2.80       43.5%
------------------------------------------------------------------------------------------------
Retail Banking                           66.2%        2.70       17.7%          1.62       25.2%
------------------------------------------------------------------------------------------------
Wealth Management                          NMF       (1.10)      -7.2%          0.15        2.3%
------------------------------------------------------------------------------------------------
Galt & Taggart Securities              1151.8%        0.82        5.3%          0.07        1.0%
------------------------------------------------------------------------------------------------
Asset Management                           NMF        0.84        5.5%          0.00        0.0%
------------------------------------------------------------------------------------------------
Insurance                                -5.7%        0.19        1.2%          0.20        3.1%
------------------------------------------------------------------------------------------------
Corporate Center                        416.8%        8.29       54.3%          1.60       24.9%
------------------------------------------------------------------------------------------------
Total Client Deposits                   137.1%       15.26      100.0%          6.44      100.0%
------------------------------------------------------------------------------------------------
*T

                              INCOME STATEMENT DATA

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*T
Period Ended                             Q1 2007           Q1 2006            Change(3)
Consolidated, IFRS Based               US$(1)      GEL   US$(2)    GEL            Q-O-Q
000s, unless otherwise noted           (Unaudited)      (Unaudited)

 Interest Income                      25,326   43,054    8,623  5,754            173.3%
 Interest Expense                     10,005   17,008    2,900  5,298            221.0%
Net Interest Income                   15,321   26,046    5,723 10,456            149.1%
 Fee & Commission Income               3,776    6,419    2,219  4,053             58.3%
 Fee & Commission Expense                290      493      253    462              6.6%
Net Fee & Commission Income            3,486    5,926    1,966  3,591             65.0%
 Income From Documentary Operations      689    1,171      343    627             86.8%
 Expense On Documentary Operations       294      500      143    262             91.0%
Net Income From Documentary
 Operations                              395      671      200    365             83.8%
Net Foreign Currency Related Income    2,515    4,276      998  1,823            134.6%
 Net Insurance Income                  1,229    2,089      678  1,239             68.6%
 Brokerage Income                        594    1,010       80    146            593.1%
 Asset Management Income                   -        -        -      -           NMF (4)
 Realised Net Investment Gains            42       71        -      -               NMF
 Other                                   569      967       75    136            608.7%
Net Other Non-Interest Income          2,434    4,137      832  1,521            172.0%
Net Non-Interest Income                8,829   15,010    3,996  7,300            105.6%
Total Operating Income (Revenue)      24,150   41,055    9,719 17,756            131.2%
 Personnel Costs                       4,427    7,525    2,261  4,131             82.2%
 Selling, General & Administrative
  Costs                                2,594    4,409    1,577  2,881             53.0%
 Procurement & Operations Support
  Expenses                             1,276    2,170      501    916            136.9%
 Depreciation & Amortization           1,156    1,965      606  1,108             77.4%
 Other Operating Expenses                269      457      259    473             -3.5%
Total Recurring Operating Costs        9,721   16,526    5,205  9,509             73.8%
Normalized Net Operating Income       14,429   24,529    4,514  8,247            197.4%
Net Non-Recurring Income (Costs)         (21)     (36)      22     40           -189.5%
Profit Before Provisions & Bonuses    14,408   24,493    4,536  8,287            195.6%
Provisions For Loan Losses             1,279    2,174      851  1,555             39.8%
Recovery Of Loans                        719    1,223      123    224            445.1%
Provisions For (Recovery Of) Other
 Assets                                  627    1,066       75    138            673.3%
Net Provision Expense                  1,186    2,017      804  1,468             37.4%
Pre-Bonus Result                      13,222   22,477    3,732  6,819            229.6%
Bonuses & Share Based Compensation
 Expenses                              3,160    5,371    1,049  1,916            180.3%
Pre-Tax Income                        10,062   17,105    2,684  4,903            248.9%
 Income Tax Expenses                   2,024    3,441      412    752            357.6%
Net Income                             8,038   13,664    2,272  4,151            229.2%

Weighted Average Shares Outstanding
 (000s)                                        25,217          15,118
Fully Diluted Number of Shares
 Period End (000s)                             27,230          15,851
EPS (Basic)                            0..32     0.54     0.15   0.27             97.3%
EPS (Fully Diluted)                     0.30     0.50     0.14   0.26             91.6%
*T

(1 )Converted to U.S. dollars for convenience using a period-end exchange rate
of GEL 1.70 per US1.00, such rate being the official Georgian Lari to U.S.
dollar period-end exchange rate as reported by National Bank of Georgia as at 31
March 2007.

(2 )Converted to U.S. dollars for convenience using a period-end exchange rate
of GEL 1.83 per US1.00, such rate being the official Georgian Lari to U.S.
dollar period-end exchange rate as reported by National Bank of Georgia as at 31
March 2006.

(3 )Growth calculations based on GEL values.

(4) Not Meaningful

                               BALANCE SHEET DATA

-0-
*T
                                  March 31, 2007     Growth(2)   December 31, 2006   Growth(4)    March 31, 2006
Consolidated, IFRS Based         US$(1)          GEL    YTD       US$(3)         GEL   Y-O-Y     US$(5)         GEL
000s, unless otherwise noted       (Unaudited)                      (Unaudited)                    (Unaudited)

Cash & Cash Equivalents         47,871       81,381     -24.5%   62,917     107,809      71.5%  25,976      47,458
Loans & Advances To Credit
 Institutions                  163,647      278,199     323.4%   38,349      65,711     170.4%  56,309     102,876
 Mandatory Reserve With NBG     35,067       59,614      -3.0%   35,869      61,461      73.8%  18,778      34,308
 Other Accounts With NBG         7,914       13,454    5600.9%      138         236     169.4%   2,734       4,995
 Balances With & Loans To
  Other Banks                  120,666      205,132    5010.4%    2,343       4,014     222.7%  34,797      63,573
Available-For-Sale Securities      308          523        NMF    3,230       5,534     -56.0%     651       1,189
Treasuries & Equivalents        27,552       46,838     -75.0%  109,279     187,244    1087.4%   2,159       3,945
Other Fixed Income
 Instruments                   115,156      195,766    4397.3%    2,540       4,353   17793.5%     599       1,094
 Gross Loans To Clients        491,376      835,339      16.8%  417,247     714,953     118.6% 209,140     382,099
 Less: Reserve For Loan
  Losses                       (12,533)     (21,307)      1.4%  (12,267)    (21,020)      1.9% (11,445)    (20,910)
Net Loans To Clients           478,843      814,033      17.3%  404,980     693,933     125.4% 197,695     361,189
Investments In Other Business
 Entities, Net                  13,116       22,297    1721.7%      714       1,224    1586.7%     724       1,322
Property & Equipment Owned,
 Net                            59,547      101,230      51.5%   39,001      66,828     154.8%  21,744      39,726
Intangible Assets Owned, Net     1,747        2,970      -5.7%    1,838       3,150      40.1%   1,160       2,119
Goodwill                        24,573       41,773       3.7%   23,507      40,279      49.8%  15,261      27,881
Tax Assets - Current &                                     NMF
 Deferred                          108          183                   -           -     -79.2%     481         878
Prepayments & Other Assets      28,431       48,333      29.7%   21,746      37,261      10.2%  24,005      43,856
Total Assets                   960,898    1,633,526      34.6%  708,098   1,213,326     157.8% 346,762     633,534

Client Deposits                354,235      602,199       7.6%  326,610     559,646      69.2% 194,765     355,835
Deposits & Loans From Banks     20,959       35,631    4019.1%      505         865     338.3%   4,449       8,129
Borrowed Funds                 310,265      527,451     136.0%  130,444     223,516     306.2%  71,079     129,862
Insurance Related Liabilities   11,591       19,705    1736.5%    4,493       7,699     -33.2%   2,111       3,856
Issued Fixed Income
 Securities                        671        1,141     -85.2%      626       1,073     411.0%     934       1,707
Tax Liabilities - Current &
 Deferred                        6,399       10,878      33.7%    4,749       8,138     994.6%     544         994
Accruals & Other Liabilities    30,135       51,230      36.5%   21,903      37,531      52.4%  18,404      33,624
Total Liabilities              734,225    1,248,234      48.9%  489,331     838,468     133.7% 292,286     534,007

Ordinary Shares                 14,850       25,245       0.2%   14,708      25,202      63.2%   8,464      15,465
Share Premium                  152,081      258,538      -6.8%  161,914     277,440     581.5%  20,763      37,934
Treasury Shares                   (681)      (1,158)     15.4%     (586)     (1,004)       NMF       -           -
Retained Earnings               35,869       60,977      64.9%   21,578      36,974      74.5%  19,124      34,939
Revaluation & Other Reserves    13,407       22,791     333.5%    3,068       5,257     308.5%   3,054       5,580
Net Income For The Period        8,037       13,664     -49.0%   15,624      26,772     229.2%   2,272       4,151
Shareholders' Equity
 Excluding Minority Interest   223,562      380,055       2.5%  216,306     370,641     287.5%  53,677      98,068
Minority Interest                3,081        5,237      24.2%    2,461       4,217     259.0%     799       1,459
Total Shareholders' Equity     226,642      385,292       2.8%  218,767     374,858     287.1%  54,476      99,527
Total Liabilities &
 Shareholders' Equity          961,056    1,633,526      34.6%  708,098   1,213,326     157.8% 346,762     633,534

Shares Outstanding                       25,244,609                      25,202,009                     15,464,558
Book Value Per Share              8.99        15.29       2.6%     8.68       14.87     137.1%    3.52        6.44
*T

(1) Converted to U.S. dollars for convenience using a period-end exchange rate
of GEL 1.70 per US1.00, such rate being the official Georgian Lari to U.S.
dollar period-end exchange rate as reported by National Bank of Georgia as at 31
March 2007.

(2) Compared to 31 December 2006; growth calculations based on GEL values.

(3.) Converted to U.S. dollars for convenience using a period-end exchange rate
of GEL 1.7135 per US1.00, such rate being the official Georgian Lari to U.S.
dollar period-end exchange rate as reported by National Bank of Georgia as at 31
December 2006.

(4 )Compared to the same period in 2006; growth calculations based on GEL
values.

(5. )Converted to U.S. dollars for convenience using a period-end exchange rate
of GEL 1.83 per US1.00, such rate being the official Georgian Lari to U.S.
dollar period-end exchange rate as reported by National Bank of Georgia as at 31
March 2006.

                                   KEY RATIOS

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*T
                                                                    Q1 2007       2006
Profitability Ratios
ROAA( 1) Annualised for Q1                                             3.8%        3.4%
ROAE(2) Annualised for Q1                                             14.4%       16.5%
Interest Income To Average Interest Earning Assets (3)                15.1%       16.7%
Cost Of Funds (4) Annualised for Q1                                    7.0%        5.8%
Net Spread (5)                                                         8.1%       10.9%
Net Interest Margin (6) Annualised for Q1                              9.1%       11.1%
Net Interest Margin, Normalised, (7) Annualised for Q1                 9.1%       10.6%
Loan Yield (8)                                                        21.2%       17.4%
Interest Expense To Interest Income                                   39.5%       33.5%
Net Non-Interest Income To Average Total Assets Annualised
 for Q1                                                                4.2%        5.8%
Net Non-Interest Income To Revenue (9)                                36.6%       40.4%
Net Fee And Commission Income To Average Interest Earning
 Assets (10)                                                           2.1%        3.5%
Net Fee And Commission Income To Revenue                              14.4%       19.0%
Total Operating Income (Revenue)/Total Assets Annualised for
 Q1                                                                   10.1%        9.2%
Operating Leverage (11)                                               38.6        18.8%
Recurring Earning Power (12) Annualised for Q1                         6.9%        7.7%
Net Income To Revenue                                                 33.3%       23.9%

Efficiency Ratios
Operating Cost To Average Total Assets (13) Annualised for
 Q1                                                                    4.6%        6.6%
Cost To Average Total Assets (14) Annualised for Q1                    6.2%        8.2%
Cost / Income (15)                                                    53.4%       56.7%
Cost /Income Normalised (16)                                          53.3%       55.9%
Cost / Income, Bank of Georgia, Standalone (17)                       50.1%       51.2%
Cash Cost/Income(18)                                                  48.6%       51.4%
Total Employee Compensation Expense To Revenue (19)                   31.4%       29.7%
Total Employee Compensation Expense To Cost                           58.8%       52.5%
Total Employee Compensation Expense To Average Total Assets
 Annualised for Q1                                                     3.6%        4.3%

Liquidity Ratios
Net Loans To Total Assets (20)                                        49.8%       57.2%
Average Net Loans To Average Total Assets                             53.0%       61.3%
Interest Earning Assets To Total Assets                               81.7%       78.4%
Average Interest Earning Assets To Average Total Assets               80.3%       77.3%
Liquid Assets To Total Assets (21)                                    33.2%       25.0%
Net Loans To Client Deposits                                         135.2%      124.0%
Average Net Loans To Average Client Deposits                         129.8%      113.4%
Net Loans To Total Deposits (22)                                     127.7%      123.8%
Net Loans To Total Liabilities                                        65.2%       82.8%
Total Deposits To Total Liabilities                                   51.1%       66.8%
Client Deposits To Total Deposits                                     94.4%       99.8%
Client Deposits To Total Liabilities                                  48.2%       66.7%
Current Account Balances To Client Deposits                           61.0%       54.4%
Demand Deposits To Client Deposits                                     5.5%        6.4%
Time Deposits To Client Deposits                                      33.5%       39.2%
Total Deposits To Total Assets                                        39.0%       46.2%
Client Deposits To Total Assets                                       36.9%       46.1%
Client Deposits To Total Equity (times) (23)                          1.56        1.49
Due From Banks / Due To Banks (24)                                     781%       7597%
Total Equity To Net Loans                                             47.3%       54.0%
Leverage (times) (25)                                                  3.2         2.2
*T

                                KEY RATIOS CONT'D

-0-
*T
                                                                    Q1 2007       2006
Asset Quality
NPLs (in GEL) (26)                                                  21,059      16,266
NPLs to Gross Loans (27)                                               2.5%        2.3%
Cost of Risk (28)                                                      1.0%        2.7%
Cost of Risk Normalised(29)                                            1.0%        2.2%
Reserve for Loan Losses to Gross Loans (30)                            2.6%        3.0%
NPL Coverage ratio (31)                                              101.2%      129.9%
Equity to average net loans to clients                                51.1%       78.8%

Capital Adequacy:
Equity To Total Assets                                                23.6%       30.9%
BIS Tier I Capital Adequacy Ratio (32)                                34.1%       44.9%
BIS Total Capital Adequacy Ratio 33                                   34.8%       41.9%
NBG Tier I Capital Adequacy Ratio (34)                                19.2%       23.2%
NBG Total Capital Adequacy Ratio (35)                                 22.5%       28.5%

Per Share Values:
Basic EPS (GEL) (36)                                                  0.54        1.62
Basic EPS (US$)                                                      $0.32       $0.89
Fully Diluted EPS (GEL) (37)                                          0.50        0.98
Fully Diluted EPS (US$)                                              $0.30       $0.54
Book Value Per Share (GEL) (38)                                      15.26       14.87
Book Value Per Share (US$)                                           $8.98       $8.14
  Change y-o-y                                                         137%        139%
Ordinary Shares Outstanding - Weighted Average                  25,216,510  16,505,701
Ordinary Shares Outstanding - Period End                        25,244,609  25,202,009
Ordinary Shares Outstanding - Fully Diluted                     27,230,351  27,229,418

Selected Operating Data:
Full Time Employees (FTE)                                            2,558       2,226
FTEs, Bank of Georgia Standalone                                     1,933       1,601
Total assets per FTE (GEL Thousands)                                   639         558
Total Assets per FTE, Bank of Georgia Standalone (GEL
 Thousands)                                                            845         776
Branches                                                               103         100
ATMs                                                                   146         124
Plastic Cards (Thousands)                                              344         286
POS Terminals                                                          497         471
*T

Note: All annualised numbers presented throughout have been annualized by
dividing Income Statement component by the number of months in the period
multiplied by twelve.

                               NOTES TO KEY RATIOS

-0-
*T
   1 Return On Average Total Assets (ROAA) equals Net Income of the period divided by quarterly
      Average Total Assets for the same period;
   2 Return On Average Total Equity (ROAE) equals Net Income of the period divided by quarterly
      Average Total Equity for the same period;
   3 Average Interest Earning Assets are calculated on a quarterly basis; Interest Earning
      Assets include: Loans And Advances To Credit Institutions, Treasuries And Equivalents,
      Other Fixed Income Instruments and Net Loans to Clients;
   4 Cost Of Funds equals Interest Expense of the period divided by quarterly Average Interest
      Bearing Liabilities; Interest Bearing Liabilities Include: Client Deposits, Deposits And
      Loans From Banks, Borrowed Funds and Issued Fixed Income Securities;
   5 Net Spread equals Interest Income To Average Interest Earning Assets less Cost Of Funds;
   6 Net Interest Margin equals Net Interest Income of the period divided by quarterly Average
      Interest Earning Assets of the same period;
   7 Net Interest Margin Normalised equals Net Interest Income of the period, less provisions
      for the interest income generated by non-performing loans through the date of their write-
      offs, plus provisions for (less recovery of) other assets, divided by quarterly average
      Gross Loans To Clients over the same period.
   8 Loan Yield equals Interest Income, less Net Provision Expense divided by quarterly Average
      Gross Loans To Clients;
   9 Revenue equals Total Operating Income;
  10 Net Fee And Commission Income includes Net Income From Documentary Operations of the
      period;
  11 Operating Leverage equals percentage change in Revenue less percentage change in Total
      Costs;
  12 Recurring Earning Power equals Profit Before Provisions and Bonuses of the period divided
      by average Total Assets of the same period;
  13 Operating Cost equals Total Recurring Operating Costs;
  14 Cost includes Total Recurring Operating Costs, Net Non-Recurring Costs (Income) and Bonuses
      & Share Based Compensation Expenses;
  15 Cost/Income Ratio equals Costs of the period divided by Total Operating Income (Revenue);
  16 Cost/Income Normalised equals Recurring Operating Costs plus Bonuses & Share Based
      Compensation Expenses divided by Total Operating Income (Revenue) for the same period.
  17 Cost/Income, Bank of Georgia, standalone, equals to non-consolidated Total Costs of the
      bank of the period divided by non-consolidated Revenue of the bank of the same period;
  18 Cash Cost equals Cost minus Depreciation & Amortisation;
  19 Total Employee Compensation Expense includes Personnel Costs and Bonuses & Share-Based
      Compensation Expenses;
  20 Net Loans equal Net Loans To Clients;
  21 Liquid Assets include: Cash And Cash Equivalents, Other Accounts With NBG, Balances With
      And Loans To Other Banks, Treasuries And Equivalents and Other Fixed Income Securities as
      of the period end and are divided by Total Assets as of the same date;
  22 Total Deposits include Client Deposits and Deposits And Loans from Banks;
  23 Total Equity equals Total Shareholders' Equity;
  24 Due From Banks/Due To Banks equals Loans And Advances To Credit Institutions divided by
      Deposits And Loans From Banks;
  25 Leverage (Times) equals Total Liabilities as of the period end divided by Total Equity as
      of the same date;
  26 NPLs (in GEL) equals total gross non-performing loans as of the period end; non-performing
      loans are loans that have debts in arrears for more than 90 calendar days;
  27 Gross Loans equals Gross Loans To Clients;
  28 Cost Of Risk equals Net Provision For Loan Losses of the period, less recovery of other
      assets, divided by quarterly average Gross Loans To Clients over the same period;
  29 Cost of Risk Normalised equals Net Provision For Loan Losses of the period, less provisions
      for the interest income generated by non-performing loans through the date of their write-
      off, plus provisions for (less recovery of) other assets, divided by quarterly average
      Gross Loans to Clients over the same period.
  30 Reserve For Loan Losses To Gross Loans To Clients equals reserve for loan losses as of the
      period end divided by gross loans to clients as of the same date;
  31 NPL Coverage Ratio equals Reserve For Loan losses as of the period end divided by NPLs as
      of the same date;
  32 BIS Tier I Capital Adequacy Ratio equals Tier I Capital as of the period end divided by
      Total Risk Weighted Assets as of the same date, both calculated in accordance with the
      requirements of Basel Capital Accord I;
  33 BIS Total Capital Adequacy Ratio equals Total Capital as of the period end divided by Total
      Risk Weighted Assets as of the same date, both calculated in accordance with the
      requirements of Basel Capital Accord I;
  34 NBG Tier I Capital Adequacy Ratio equals Tier I Capital as of the period end divided by
      Total Risk Weighted Assets as of the same date, both calculated in accordance with the
      requirements the National Bank of Georgia;
  35 NBG Total Capital Adequacy Ratio equals Total Capital as of the period end divided by Total
      Risk Weighted Assets as of the same date, both calculated in accordance with the
      requirements of the National Bank of Georgia;
  36 Basic EPS equals Net Income of the period divided by the weighted average number of
      outstanding Ordinary Shares over the same period;
  37 Fully Diluted EPS equals Net Income of the period divided by the number of outstanding
      Ordinary Shares as of the period end plus number of ordinary shares in contingent
      liabilities;
  38 Book Value Per Share equals Total Equity plus Treasury Shares, divided by the total number
      of outstanding Ordinary Shares.
*T