MICROCAPITAL BRIEF: TBC Bank to Acquire ProCredit Bank Georgia’s Microcredit Portfolio

TBC Bank, a commercial bank that was founded in 1992 in Georgia as the Tblisi Business Centre, reportedly will acquire the microcredit portfolio of ProCredit Bank Georgia (PCBG), a financial institution that is majority-owned by Germany-based ProCredit Holding. As of January 2015, PCBG’s gross microloan portfolio amounted to GEL 39.3 million (USD 19.2 million). These loans, defined as those smaller than EUR 10,000 (USD 11,300), represent 5 percent of PCBG’s total loan portfolio. The purpose of the move is to allow PCBG to concentrate on the financing of small and medium-sized enterprises (SMEs) [1].

Mr Nikoloz Kurdiani, TBC Bank’s Deputy CEO and Head of Micro Banking, said, “We are pleased to increase further our Micro loan portfolio and reinforce our leadership position in the Micro segment, which is one of the Bank’s main priorities. Given that TBC Bank has recently completed the integration of its fully owned micro-focused subsidiary Bank Constanta, the acquisition of the Micro Loans portfolio is another major step forward for the enhancement of our Micro Banking business. The acquisition of Procredit Bank’s portfolio translates into thousands of new clients, a significantly increased market share and more opportunities for reaching out to rural areas ” [1].

As of September 2014, TBC Bank reported total assets of USD 2.8 million, with 19.4 percent return on average equity (ROAE) and 3.4 percent return on average assets (ROAA). Its customer’s deposits totalled GEL 3. billion (USD 1.5 million), and its gross loan portfolio amounted to GEL 3.23 billion (USD 1.57 million), of which GEL 239 million (USD 116 million) are microloans. As of 2013, PCBG reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 603 million, total deposits of USD 329 million, a gross loan portfolio USD 412 million, return on assets (ROA) of 1.9 percent and return on equity (ROE) of 13.7 percent.

ProCredit Holding provides credit and other banking services to small and medium-sized enterprises and lower- and middle-income savers who have previously had limited access to formal financial services. As of September 2013, ProCredit reported total assets of EUR 5.8 billion (USD 7.6 billion), a gross loan portfolio of EUR 4.2 billion (USD 5.6 billion), customer deposits of EUR 3.6 billion (USD 4.7 billion) and return on equity (ROE) of 9.4 percent.

By Julia Marín, Research Associate

About TBC Bank

TBC Bank is a commercial bank that was founded in 1992 in Georgia as the Tblisi Business Centre. It offers financial products and services through corporate, retail, small and medium-sized enterprise (SME), and microbanking business lines. As of September 2014, TBC Bank reported total assets of USD 2.8 million, with 19.4 percent return on average equity (ROAE) and 3.4 percent return on average assets (ROAA). Its customer’s deposits totalled GEL 3. billion (USD 1.5 million), and its gross loan portfolio amounted to GEL 3.23 billion (USD 1.57 million), of which GEL 239 million (USD 116 million) are microloans.

About ProCredit Bank Georgia (PCBG)

ProCredit Bank Georgia (PCBG) is a member of Germany’s ProCredit Group that operates in Georgia. PCBG defines itself as “development-oriented” and works with small and medium-sized enterprises. As of 2015, it was in the process of selling its microcredit portfolio to Georgia’s TBC Bank. As of 2013, PCBG reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 603 million, total deposits of USD 329 million, a gross loan portfolio USD 412 million, return on assets (ROA) of 1.9 percent and return on equity (ROE) of 13.7 percent.

About ProCredit Holding

As of December 2013, Germany’s ProCredit Holding provides financial services through 645 branches, serving 2.4 million customers in 19 countries across Eastern Europe, Latin America and Africa. It provides credit and other banking services to small and medium-sized enterprises and lower- and middle-income savers who have previously had limited access to formal financial services. As of September 2013, ProCredit reported total assets of EUR 5.8 billion (USD 7.6 billion), a gross loan portfolio of EUR 4.2 billion (USD 5.6 billion), customer deposits of EUR 3.6 billion (USD 4.7 billion) and return on equity (ROE) of 9.4 percent.

Sources and Resources:

[1] Investigate, TBC Acquires Micro Loans Portfolio from Procredit 

MicroCapital, November 2, 2012, Absolute Dual Return-Vision Microfinance Fund Invests $3.2m in FINCA Russia, AzerCredit of Azerbaijan, Bank Constanta of Georgia, Mikrofin of Bosnia and Herzegovina 

MicroCapital, August 6, 2012, European Fund for Southeast Europe (EFSE) Loans $10m to ProCredit Bank of Georgia https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-efse-loans-10m-to-procredit-bank-of-georgia/

MicroCapital, November 16, 2011, European Fund for Southeast Europe Lends $20m to ProCredit Bank Georgia for Microfinance, SMEs 

MicroCapital, May 9, 2011, responsAbility Loans $8.7m to Microfinance Institutions (MFIs) Microenterprise Development Fund Kamurj of Armenia, ProCredit Bank Georgia
MicroCapital Universe: ProCredit Bank Georgia (PCBG)

MicroCapital Universe: ProCredit Holding

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