Georgia: Weekly Market Watch

Georgia: Weekly Market Watch

Georgia: Weekly Market Watch

The FINANCIAL -- Economy

NPLs at 3.6% in April 2016

In April 2016, the loan portfolio grew 6.6% y/y, excluding the exchange rate effect (+4.2% y/y and -3.0% m/m in unadjusted terms), to GEL 15.5bn (US$ 6.9bn). Deposits grew 14.2% y/y, excluding the exchange rate effect (+11.4% y/y and +1.1% m/m in unadjusted terms), reaching GEL 14.4bn (US$ 6.5bn). On a monthly basis, loan growth was down due to GEL appreciation, lowering FX-denominated loan nominal value in GEL terms. NPLs remain under control at 3.6% in April 2016, unchanged y/y and up 0.4ppts m/m.

Property registration up 32.4% y/y in April 2016

Property registration (commercial and residential real estate) increased 32.4% y/y (-7.4% m/m), reaching 55,882 units in April 2016, according to the National Agency of Public Registry. Registration increased for primary (+66.1% y/y, 23.9% of total), as well as secondary (+24.5% y/y, 76.1% of total) properties.

Company registration up 10.6% y/y in April 2016

In April 2016, company registration increased 10.6% y/y (-16.9% m/m) to 4,081 units, according to National Agency of Public Registry. Out of newly registered companies, 97.3% were business legal entities, while 2.7% comprised non-entrepreneurial (non-commercial) legal entities.

Unemployment rate at 12 year low

In 2015, the annual unemployment rate in Georgia fell by 0.4ppts y/y to 12.0% (12 year low), according to GeoStat. Out of employed persons, the share of hired labor increased by 2.7ppts and accounted for 42.5% of total (753.4 thousand persons, highest number since record started), while share of self-employed persons declined to 57.5% of total (1.0mn persons).

Fixed income

Corporate Eurobonds: Bank of Georgia Eurobonds (GEBGG) closed at 3.9% yield, trading at 104.1 (-0.4% w/w). GOGC Eurobonds (GEOROG) were trading at 101.9 (unchanged w/w), yielding 4.8%. Georgian Railway Eurobonds (GRAIL) traded at a premium at 110.0 (+0.4% w/w), yielding 5.8%. 

Georgian Sovereign Eurobonds (GEORG) closed at 110.6 (-0.2% w/w) at 4.4% yield to maturity. Georgia Eurobonds, YTM (%)

Equities

BGEO Group (BGEO LN) shares closed at GBP 25.77/share (+7.42% w/w and +15.10% m/m). More than 419k shares traded in the range of GBP 23.73 – 26.50/share. Average daily traded volume was 63k in the last 4 weeks, more than in the previous month. FTSE 250 Index, of which BOGH is a constituent, gained 2.86% w/w and gained 0.74% m/m, respectively. The volume of BOGH shares traded was at 1.06% of its capitalization. 

 TBC Bank (TBCB LI) closed the week at US$ 13.00 (+8.33% w/w and +23.81% m/m). More than 38k GDRs changed hands in the range of GBP 11.75 – 13.00//GDR. Average daily traded volume was 11k in the last 4 weeks, more than in the previous month.

Georgia Healthcare Group (GHG LN) shares closed at GBP 2.52/share (+8.62% w/w and +30.57% m/m). More than 269k shares were traded in the range of GBP 2.21 – 2.62/share. Average daily traded volume was 35k in the last 4 weeks. The volume of GHG shares traded was at 0.09% of its capitalization. 

GEO Group PLC (BGEO LN)

Money Market

Refinancing loans: National Bank of Georgia (NBG) issued 6-day refinancing loans of GEL 250mn (US$ 116.4mn).

Certificates of deposit: NBG sold 91-day, GEL 20mn (US$ 9.1mn) certificates of deposit, with an average yield of 7.50% (down 102bps from previous issue).

Ministry of Finance Treasury Notes: 1-year GEL 45.0mn (US$ 20.7mn) T-Bills of Ministry of Finance were sold at the auction held at NBG on May 18, 2016. The weighted average yield was fixed at 7.986%. The nearest treasury securities auction is scheduled for June 1, 2016, where GEL 25mn nominal value 1-year T-Bills will be sold.

Provided exclusively to The FINANCIAL by Galt & Taggart