The stock of non-government bank loans in Georgia increased by 12.9% y/y as of the end of September to GEL40.14bn ($12.86bn), marking one of the lowest annual growth rates since 2016, according to data reported by the National Bank of Georgia.
It was the second-lowest nominal annual increase rate, after 12.3% y/y in April.
But the nominal advance of lending was nearly fully offset by the rising inflation.
In real terms, deflated by the consumer price inflation, the volume of bank loans edged up by a modest 0.6% y/y at the end of September, marking a sharp deceleration from +17.8% as of the end of February. At that time, however, the headline inflation was only 3.6% y/y – while it surged to 12.3% y/y as of the end of September.
On a positive note, the dollarisation of the bank loans portfolio in Georgia diminished somewhat, but it remained quite high at 51.0% at the end of September, compared to 56.9% one year earlier.
The loan portfolio is roughly equally split between companies and households (49%:51%) and the annual growth rates are roughly similar as well. Thus, the stock of corporate loans rose by 12.8% y/y while household loans rose by 13.4% y/y.
Speaking of the sectors with the most dynamic borrowing rates, loans to agriculture soared by nearly 50% while the sectors of transport and constructions boasted robust growth rates as well (+25% y/y and +23% y/y respectively). The stock of consumer loans (GEL5.6bn, more than a quarter of the household loans) rose by 24% y/y, while mortgage loans (more than half of the household loans) advanced by only 9.8% y/y.