News Column

SPECULATIONS THROUGH REFINANCING LOANS OF NATIONAL BANK OF GEORGIA

January 17, 2014

Rezonansi

The article reports that issuing of large amounts on refinancing loans' auctions became a trend recently, especially since the second half of 2012. For example, National Bank of Georgia has brought more than 1 billion lari on auctions in January of the current year. The article brings comments on this issue, provided by experts Demur Giorkhelidze and Lia Eliava. Both of them point that these funds do not enter real economy. "This is pure speculation, commercial banks gain very big profits", Giorkhelidze declares. Eliava points that "refinancing loan has duration of 7 days, so you cannot use it for lending activities". However, growth of these loans' volume "clearly indicates that there are serious problems with liquidity in Georgia's banking sector", she declares.


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Source: Sarke Economic Press Monitor (Georgia)


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