February 16, 2018 / 8:07 AM / 2 years ago

UPDATE 1-Georgia's BGEO full-year profit rises ahead of business split

(Adds results details, background)

Feb 16 (Reuters) - Georgia’s BGEO Group Plc, which is planning to split its banking and investment businesses, reported an 8.1 percent rise in full-year profit as both the businesses performed well in a growing economy.

The Tbilisi-based bank, formerly known as Bank of Georgia Holdings, said profit rose to 463.4 million lari ($189.5 million) for 2017, with revenue rising 23.7 percent to 1.1 billion lari.

CEO Irakli Gilauri said its banking and investment businesses were supported by Georgia’s strong macroeconomic performance and business outlook.

Net interest margin stood at 7.3 percent compared with 7.4 percent a year earlier.

The holding company said its banking division posted a profit growth of 25 percent at 369.5 million lari, while core earnings at its investment business jumped 55.7 percent to 106.5 million lari.

BGEO’s banking unit has more than a third of Georgian banks’ market share based on total assets, loans, deposits and shareholders’ equity.

Investment management’s assets under management increased 17.9 percent 1.86 billion lari, reflecting higher bond issuance activity at BGEO’s brokerage arm Galt & Taggart.

BGEO said in July it intended to demerge into London-listed banking and investment businesses.

Georgia’s economy expanded by 4.8 percent year-on-year in 2017, up from 2.2 percent in the previous year, and Governor Koba Gvenetadze has said current economic indicators showed that 2018 “will be a continuation of the economic recovery which started last year”.

Economic growth accelerated thanks to higher exports and remittances from abroad.

BGEO’s rival TBC Bank Group Plc, Georgia’s largest retail bank, will report results next week. ($1 = 2.4450 lari)

Reporting by Noor Zainab Hussain in Bengaluru; Editing by Amrutha Gayathri and Gopakumar Warrier

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