Georgian President Minds Russian Banks
07 March, 2013
Georgian President Minds Russian Banks
Presidnet of Georgia, Mikheil Saakashvili, bewares of likely entry of Russian banks into Georgian banking sector as hazardous for Georgian economy and population. Sector pundits find his statement irresponsible and affecting the image of Georgia and its banking sector. Georgian president looks so concerned over possible entry of Russian banks into Georgian reality that he disseminates the false information about alleged handover of leading Georgian banks such as Liberty Bank and TBC Bank to Russian giant banks Alfa Bank and SberBank
respectively.
“Alfa Bank, one of the biggest Russian banks, closely affiliated with the Kremlin, buys TBC Bank, Cartu [owned by the family of Prime Minister of Georgia Bidzina Ivanishvili, who earned his billions in Russia before he joined Georgian political life -GJ] is already a Russian bank, Gazprom Bank is intent on buying several Georgian banks. We should understand that 60-70% of Georgians is tied to those banks through their credits, mortgages, etc. Georgian authorities declare that economy will go down. If there is no growth, people fail to pay off credits, the banks will seize their property,” Saakashvili said during his meeting with Georgian media that was aired by TV channels on February 26, 2013.
The President warned that Ukraine is already facing that problem as 70% of Ukrainian capital is in Russia’s hands, which prompts Europe to have “cold reaction” to Ukraine. According to Saakashvili, he spoke of the entry of Russian banks based on the information of the National Bank of Georgia (NBG); however, the NBG as well as the Georgian banks in question refuted the information. Both Liberty Bank and TBC Bank instantly, against the backdrop of the ongoing press-conference where Saakashvili starred, spread the counter-information stating that they hadn’t either sold out their banks or were planning to divesture them to the referred or any other Russian banks. The NBG disclaimed the presidential statement on the second day, stating that “it has no information about possible divesture of share of Georgian commercial banks that were named at the TV press conference.” Press-centers of SberBank and Alfa Bank also refuted any ongoing or upcoming negotiations on acquisition of the shares of Georgian banks, Inter-Press news agency reported. Later Saakashvili said “sorry” for voicing mistaken information although he insisted that Russian banks are interested in purchasing Georgian banks and he just confused the names of the banks.
“If I named banks incorrectly, it was not a deliberate action, I did not want to create problems to the banks,” Saakashvili said on February 27, 2013.
However, he created problems. Georgian authorities as well as economic analysts assessed the Presidential lie as unethical and irresponsible since negative statements of high-ranking officials might inflict an irretrievable damage on the said Georgian banks.
“This presidential statement was an outrageous sabotage. When the President goes and announces about banks’ handover, it may lead to the bankrupcy of the banks, clients may panic and demand their money. There are such instances in the world practice. Fortunately, Georgian clients did not react that way,” Irakli Lekvinadze, the economic analyst, said.
According to Giorgi Kvirikashvili, Minister of Economy and Sustainable Development of Georgia, who was director general of Cartu Bank just a year ago, banks are ten-fold sensitive businesses and statements should be made carefully. He reminds Saakashvili that he was the one who approved entrance of Russian VTB Bank in United Georgian Bank (UGB) in 2005 when UGB covered 10% of entire Georgian system. The sector pundits also indicate on divesture of state property with strategic importance to the state-owned Russian companies such as gold exploration and procession industry, electricity and water distribution networks of Tbilisi. Besides, the Czech-based company that privatized electricity distribution network in regions is supposed to be a front figure to Russian capital. Saakashvili’s government was intent to divesture the Georgian portion of the North-South gas pipeline running from Russia to Armenia and only interference of the White House changed their mind.
“I wonder that Saakashvili who has been handing Georgian companies to Russian companies for 9 years of his office term is wary of Russian capital inflow in Georgia now,” Demur Giorkhelidze, an economic analyst said. “As a result Russian capital is so heavily represented in Georgia that addition of two more banks cannot aggravate the situation. The more so that Alfa Bank is a very successful bank with good management and it may do only good to Georgia distorted banking system if this bank enters here with its financial policy and skills.”
According to him, Saakashvili’s regime is responsible for creation of a vicious banking system in Georgia monopolized by couple of favorite banks that finance only their own affiliated businesses and enjoy huge profits rather than to finance economy.
“Russian banks disburse credits at 11-12% as cap interest rates and aim to cut to 9-10% while rates of Georgian banks start from 12% and go as high as 24%. It will be great if they enter here and cut down credit price,” Girokhelidze said.
Print
Other Stories
Inovative and reliable online shop in Georgia - Momitane.ge
Status of Georgia as a business and tourism interesting country is growing from year to year.
Tbilisi TV Broadcasting Tower – Better than the Eiffel Tower?
It is planned to renovate the Tbilisi TV Broadcasting Tower, one of the landmarks in the capital.
Georgian Fusion Menu by The Biltmore Hotel Tbilisi
5,895,914 international visitors have visited Georgia between January and August of 2018. Compared to the previous year the number has increased by 12.2 per cent.
Advertising of gambling and lucrative games may become banned in Georgia
Advertising of gambling and lucrative games may become banned in Georgia. Those who violate the new rule would be fined GEL 10 000.
Lebanese café-lounge Beirut opens in Tbilisi
What is necessary to organize an unforgettable event? – Fun, emotions, lots of surprises, good music and delicious menu.
Georgia second among the fastest growing tourist destinations in Europe
Georgia is among the fastest growing tourist destinations in Europe. The data is published by the UN World Tourism Organization.
Bitmain launches world digital mining summit in Tbilisi, Georgia
Bitmain CEO Jihan Wu and Roger Ver, CEO of Bitcoin.com Head Speaker List featuring Circle, DEX.top and Genesis Mining when Digital Mining Leaders Convene In Tbilisi on September 21-23
GAZELLE FINANCE GEORGIA AND TBC BANK HELP THE WESTERN REGIONAL CENTER OF MODERN MEDICAL TECHNOLOGIES EXPAND ACCESS TO QUALITY HEALTHCARE SERVICES IN KUTAISI, GEORGIA
TBC Bank and Gazelle Finance have teamed-up to support Medical City, a leading healthcare provider in the western region of Georgia to launch the Western Regional Center Of Modern Medical Technologies.
Equiavlent to buried treasure – resources that are underused in Georgia
For 2018 the IMF Commission has forecast an annual economic growth for the Georgian economy of about 5,5%.
Does the quality of Georgian wine increase and how the export affects it
If we look at the data collected about modern Georgian wine, we will find out that the Georgian wines produced between 2015-2017 are much better in terms of their quality and Oenologic features rather than the wines produced between 2009-2011.
Japan simplifies the visa requirements for Georgian citizens
Diplomatic and economic relations between Georgia and Japan are now moving to a new phase. Recently Japan has decided to simplify the visa requirements for Georgian citizens.
M&S (Marks and Spencer) and H&M collections to be produced in Georgia
Garments manufacturer MGMTEX will start production of the M&S and H&M trendy collections from this September.
The World Digital Mining Summit to be held in Georgia
The summit is scheduled to take place between 21st-23rd September in the Hualing Hotel, Tbilisi, Georgia.
Galt and Taggart - Tourism Boom Continues in Georgia
Tourism has become one of the key drivers for the Georgian economy. Galt and Taggart has recently published research about the Georgian tourism sector in the first half of 2018.
"The worst dream for Putin is that Russians want to live in Georgia"
This year, visitors to the Adjara region would notice that there is a boom in construction in and around Batumi.
Underground gas storage facility to be built in Georgia
KfW, a German government-owned development bank signed a EUR 150 million promotional loan with the state-owned Georgian Oil and Gas Corporation (GOGC) for the construction of the first underground gas storage facility in Georgia.
New gambling rules for Georgia
Georgian lawmakers are preparing a new draft law relating to online-casinos and gambling that will seek to curb gambling addiction in Georgia.
How expensive is it to visit Georgia?
The Georgian Lari (GEL) is the official currency of Georgia and is the only legal means of payment in the entire territory of Georgia.
Trade with the EU and the Commonwealth of Independent States (CIS) has grown significantly
Trade with the EU and the CIS has grown by 26% and 33.5 % respectively, says GeoStat, the Georgian National Statistics Office.
The unemployment rate decreases in Georgia
The unemployment rate decreased in Georgia by 1,9% and amounted to 12.1% in the 2nd quarter of 2018 compared with the previous quarter,
Memorandum of Understanding to be signed between Georgia and Malaysia
According to the Georgian Ambassador to Malaysia Nikoloz Apkhazava, Georgia plans to sign a Memorandum of Understanding (MoU) with Malaysia.
“Blauenstein Georgia” due to expand in Georgia
“Blauenstein Georgia” is planning to open more shops in Georgia. It is an agriculture company that sells meat products, meat and convenience food.
The amount of Direct Foreign Investment rises in Georgia
According to the information of the National Statistics Office of Georgia, the amount of direct foreign investment in Georgia has risen
It’s going to get  harder for foreigners to get residence permit in Georgia
It’s going to get harder for foreigners to get permit of residence in Georgia.
Mziuri Park in Tbilisi to be renovated soon
It was the dream of prominent Georgian writer Nodar Dumbadze that when the original Mziuri park was constructed and opened in 1892 that it should be a park for children,
PHOTO OF THE DAY
Exchange Rates
GEL Exchange Rate
Convertor
12.11.2018
13.11.2018
USD
1
USD
2.7146
2.7166
EUR
1
EUR
3.0800
3.0602
GBP
1
GBP
3.5325
3.4900
RUB
100
RUB
4.0430
4.0131
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange
USD
1
USD
2.7166
EUR
1
EUR
3.0602
GBP
1
GBP
3.4900
RUB
100
RUB
4.0131
November 2018
Mon Tue Wed Thu Fri Sat Sun
1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30