IFC Invests in NBG GEL Eurobond to Drive Private Sector Growth

IFC, a member of the World Bank Group, has supported the Bank of Georgia in its inaugural local currency Eurobond issuance by investing GEL 108.34 million (approximately $45 million), to attract much-needed international financing in local currency for Georgia’s private sector, and to boost job creation and economic growth.

As the anchor investor, IFC announced its commitment to purchase up to 30 percent in the bank’s planned issuance early on, supporting the offering during the investor roadshow and helping to strengthen confidence in the upcoming transaction. Bank of Georgia’s bond issuance has attracted GEL 500 million (approximately $207 million) from aroound 20 international investors.

The three-year bond is the first off-shore local currency bond issued by a corporate from Georgia, and also the first in the past decade from a former member of the Soviet Union, other than Russia. The issuance will allow the country’s leading bank to boost long-term local currency financing, which enables businesses to grow and avoid risks related to borrowing in foreign currency. The issuance will also support the country’s de-dollarization efforts, aimed at reducing its reliance on foreign currency.

“The success of this landmark transaction demonstrates the confidence of international investors in Georgia’s currency and economy, and will help connect them to Georgia’s private sector financing needs,” said Jan van Bilsen, IFC Regional Manager for the South Caucasus. “It will also allow the bank to provide much-needed local currency finance to more retail borrowers and small and medium businesses, to help them expand, create more jobs, and boost economic development.”

“IFC has been a long-time partner for us and I am grateful for the tremendous support it has provided in this landmark transaction. IFC's bid gave us great support in building investor confidence and creating early momentum in book build,” said Kaha Kiknavelidze, Bank of Georgia, CEO. “This landmark bond has as much a developmental as a funding purpose. Successful completion of the issuance has greatly expanded the investor base in Lari and, I hope, will deepen local fixed income and currency markets.”

Georgia became an IFC member in 1995. Since then, IFC has committed around $1.64 billion in long-term financing, of which $774 million was mobilized from partners, in 59 projects in financial services, agribusiness, manufacturing, and infrastructure. In addition, IFC has supported more than $331 million in trade through its trade finance program, and implemented a number of advisory projects focused on developing the private sector in Georgia. In fiscal year 2016, IFC invested almost $19 billion in developing countries worldwide.

About IFC

IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY16, we delivered a record $19 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity.

About Bank of Georgia

JSC Bank of Georgia is the leading Georgian bank with a market share of 33.0% (based on total assets), 32.0% (based on total gross loans) and 32.8% (based on amounts due to customers) as at 31 March 2017. The Bank offers a broad range of retail banking, corporate banking and investment management services. As of 31 March 2017, Bank of Georgia served approximately 2.2 million client accounts through one of the largest distribution networks in Georgia, with 274 branches, the country’s largest ATM network, comprising 813 ATMs, 2,723 Express pay (self-service) terminals and a full-service remote banking platform and a modern call center.