20 March 2017

Loan Larization Program Is an Extreme Success

VTB Bank (Georgia) tops the field according to the Larization Program results.

Preliminary results show that VTB Bank (Georgia) converted up to 40 percent of eligible loans. More than 550 loans had been converted with overall value up to 12 million GEL.

According to the assessment of the Bank success of the Program will have a positive impact on financial stability of the country. Larization mechanism is meticulously tailor-fit to tackle the main challenge facing Georgian banking system – high Dollarization index.

The latter program has already created a source for long-term financing in Georgian Lari and significantly contributed to reducing financial loss related risk facing large portion of country’s population, increasing share of Lari in economy and reducing pressure on Banks’ capital. It is noteworthy that sceptics were proven wrong, including in regard with the fall of Lari exchange rate.

VTB Bank (Georgia) intends to offer Lari loans in the future as well to further reduce Dollarization index of its Loan Portfolio.

As you may be aware, the Program was launched on January 17 and envisaged converting real estate secured US Dollar loans into Georgian Lari. Conversion principle Official NBG Exchange Rate – 20 Georgian Tetris could be applied to maximum permissible 40 000 US Dollar loans. 

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