The National Bank of Georgia (NBG) has released a special statement on the new deal between TBC Bank and Bank Republic. The statement reads:
“Regarding information on the current deals in the bank sector, the National Bank of Georgia (NBG) declares that negotiations between the parties are confidential and the NBG is not authorized to divulge details of the specific deal. At the same time, the NBG, within its competences, in the decision-making process takes into account the competitive environment interests and aspiration for stable and efficient operation of the finance system , protection of rights of consumers and investors.
In this respect it is important that absence of barriers from entrance to and exit from the banking market promotes free circulation of investments and lowers expenses for drawing capital. All these advantages make positive influence on the finance sector’s efficiency.
When analyzing specific transaction, it is important to take into account influence on competitive environment and finance sector efficiency, investors and consumers protection issues, as well as small size of the market, where, according to the international practice, enlargement is one of the main mechanisms for efficiency. Moreover, growth in efficiency lowers interest rates.
It is important that, under risks-oriented supervision regime, analysis of the mentioned factors is carried out on permanent basis and this analysis is also reflected in the NBG annual report”, the NBG statement reads.