Tbilisi, Georgia, June 7, 2010—IFC,
a member of the World Bank Group, will provide Bank of Georgia with multiple
U.S. dollar and euro currency swaps over the next two years, enabling the
bank to better manage its euro deposit base and provide a wider range of
deposit products to customers thereby enhancing Georgia’s financial system.
This is IFC’s first deposit hedging
project in Georgia, and it will fill an important market gap in the aftermath
of the global financial crisis. The transaction will be implemented
under IFC and Bank of Georgia’s existing International Swaps and Derivatives
Association Master Agreement, the international legal documentation for
the execution of risk management transactions, signed in May 2009.
The agreement is part of IFC’s strategy
aimed at introducing innovative products to its clients in Europe and Central
Asia to enhance risk management capacity.
“This transaction gives Bank of Georgia
a better tool for currency risk management and reduces the cost of hedging
foreign exchange risk,” said Irakli Gilauri, Bank of Georgia’s CEO. “It
will enable us to hedge our foreign exchange risk for up to €30 million.”
Thomas Lubeck, IFC Regional Head, Caucasus,
said, “We are glad to expand cooperation with our long-term partner, Bank
of Georgia. This innovative tool will support the bank, and it’s
a perfect example of the high value-added services that we provide to our
IFC, a member of the World Bank Group, creates opportunity for people to
escape poverty and improve their lives. We foster sustainable economic
growth in developing countries by supporting private sector development,
mobilizing capital for private enterprise, and providing advisory and risk
mitigation services to businesses and governments. Our new investments
totaled $14.5 billion in fiscal 2009, helping channel capital into developing
countries during the financial crisis. For more information, visit www.ifc.org.
About the Bank of Georgia
Bank of Georgia is the leading Georgian
bank, offering a broad range of corporate and investment banking, retail
banking, wealth management and insurance services to its customers in Georgia,
Ukraine, and Belarus. It is the largest bank in Georgia by assets, loans,
deposits and equity, with a 34.3 percent market share by total assets.
The bank has 140 branches and about a million retail and more than 157,000
corporate current accounts. For more information, visit www.bog.ge/ir.