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Currency trends of deposits in Georgian banks

Currency Trends of Deposits in Georgian Banks

Latest trends of deposits made in Georgian banks show the total volume of non-bank deposits, time deposits and demand deposits are growing in Georgia.

At the same time, the percentage share of Georgia’s national currency has in all currency usage otherwise called the Larization ratio], is also increasing. Today the National Bank of Georgia (NBG) published a report that showed the total volume of non-bank deposits in the country’s banking sector had increased by 3.1 percent (or by 395.5 million GEL) compared to April 1, 2015 and reached 13 billion GEL by May 1, 2015.

As a result of operations (excluding exchange rate effects) the above mentioned indicator increased by 0.9 percentage points, while exchange rate changes caused an increase of an additional 2.2 percentage points, noted the bank in a press release. In April 2015 the volume of time deposits increased by 245.1 million GEL (3.3 percent). Operations caused an increase of 0.7 percentage points, while exchange rate changes caused an increase of 2.6 percentage points. Demand deposits increased by 150.4 million GEL (3.0 percent) at the same time, said the Bank.

The contribution of exchange rate changes to the growth rate was 1.7 percentage points and the contribution of operations was 1.3 percentage points. The Larization ratio of total non-bank deposits constituted 33.75 percent by May 1, 2015. The Bank noted the Larization ratio had increased by 0.07 percentage points compared to April 1, 2015, excluding the effect of the changing exchange rate.

The annual average weighted interest rate on time deposits was 5.2 percent. In particular, the interest rate for national currency denominated deposits was 8.3 percent and the interest rate for foreign currency denominated deposits was 4.1 percent. The share of the US dollar in the total volume of foreign currency denominated deposits reached 81.7 percent and the share of deposits in Euro equalled 15.3 percent.