IMF welcomes NBG governance reforms

23% from March 2025 to March 2026 to GEL5.04 billion (about $1.87 billion). This growth was largely driven by a 43% rise in the value of Lion Finance Group, Georgia Capital’s largest and only listed holding, while the private portfolio value also grew by 18%. Portfolio rotation, such as the sale of the water utility business, also affected the performance of the private portfolio. In the first three months of 2026, the total portfolio value reduced by 0.6%, due to some contraction in Lion Finance Group’s share price, the recent divestment, and dividends paid. However, this was partially offset by robust performance in the private portfolio, which was up 3%.Value creation was most pronounced in the retail (pharmacy) business (up 6.1%) and the insurance business (up 7.6%), while the emerging and other companies segment weighed on the overall portfolio value, as it did in 2025, which may lead to some divestments in the future. Over the three months, the net asset value (NAV) decreased by 0.8%, although S&P notes that it has increased by 33% since March 2025.“We expect Georgia Capital to maintain low leverage, supported by continued disciplined debt management. As part of its GEL700 million capital return program, Georgia Capital had used GEL274 million as of April 2026 to redeem a portion of its outstanding bond (which equates to about $100 million of the total principal of $150 million). We expect to see continued use of cash or potential proceeds from the sale of smaller private assets for debt redemption in the near term, demonstrating the company’s commitment to deleveraging. Furthermore, the target NCC ratio of 10% over the cycle supports our view of the company’s disciplined approach to capital allocation.According to the company’s policies, an NCC ratio of 10%-40% will trigger tactical share buybacks or investments, an NCC ratio of below 10% could generate more substantial share buybacks or investments, and an NCC ratio of above 40% would lead the company to preserve cash. As of March 31, 2026, the NCC ratio was 3.9%. A significant increase is not in our base case nor would we view it as commensurate with our rating. Although the ratio slightly increased from 2.3% in December 2025, due to a $50 million share buyback and cancellation program announced in February 2026, it is in line with allocation expectations. The company's NCC ratio includes planned investments, announced share buybacks, and a contingency/liquidity buffer.Our adjusted LTV ratio for Georgia Capital as of March 31, 2026, was 0.4% (excluding future share buybacks or potential equity investments that are uncommitted). We think that the company could navigate relatively volatile market conditions that affect the valuation of its assets while maintaining an adjusted LTV ratio well below 10%”, the document reads.One of the main limitations of S&P's assessment of Georgia Capital's business risk remains its high concentration in Georgia and significant reliance on a single listed asset, Lion Finance Group, which accounts for 47.2% of the total portfolio value and owns 16.6% of LFG itself.According to S&P, the weighted average credit quality of the companies invested in by the group corresponds to the level of "B+".

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Last year, 6.6 million liters of wine worth $18.03 million were exported from Georgia to the Polish market. According to the ranking, the average price of Georgian wine is $2.73 per liter, which exceeds the indicators of such large exporters as Germany, Portugal, Spain and Chile.Italy maintains its absolute leadership in the Polish wine market, accounting for 31% of the total import value ($139.15 million) and 25% of the volume (36.55 million liters). The average price of Italian wine is $3.81 per liter.According to the study, the top five importers of Poland are as follows: Italy - $139.15 million (36.55 million liters, price: $3.81/liter) France - $58.41 million (12.63 million liters, price: $4.62/liter) Germany - $57.19 million (21.86 million liters, price: $2.62/liter) Portugal - $45.12 million (17.05 million liters, price: $2.65/liter) Spain - $41.32 million (19.39 million liters, price: $2.13/liter) It is worth noting that among the TOP-5 exporters, French products have the highest price category ($4.62/liter), while Spanish wine is the most affordable ($2.13/liter). Georgia's immediate neighbors in the ranking are the USA (6th place, $26.27 million), Chile (7th place, $19.37 million) and Moldova, which occupies ninth position with $7.54 million.In total, the weighted average price of wine imported into Poland from various countries of the world is $3.08 per liter.

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“Georgia’s economy has remained resilient amid heightened global uncertainty, including from the war in the Middle East. Real GDP expanded by 7.5 percent in 2025 and remained strong in early 2026, while inflation rose above target due to higher energy prices, reaching 5.9 percent in April 2026. Fiscal and external buffers have strengthened, with reserves reaching the IMF’s adequacy threshold and public debt declining below 35 percent of GDP.Assuming the Middle East war is resolved soon, growth is projected to moderate to 6.5 percent in 2026, gradually converging to its medium-term potential rate of 5 percent by 2028. Inflation is expected to return to target by mid-2027 and public debt to remain near current levels with continued prudent monetary and fiscal policies”, - the document reads.According to the IMF, Georgia's external position in 2025 was stronger than expected, given medium-term fundamentals and preferred economic policies."Amid the narrowing of the current account deficit and the increase in international reserves, the external sector position has strengthened. In 2025, the current account deficit decreased to a historical low of 2.6 percent of GDP, mainly due to strong growth in services exports (especially ICT and tourism) and low growth in goods imports against the backdrop of low oil prices. At the end of April 2026, international foreign exchange reserves amounted to USD 6.4 billion, which corresponds to 102 percent of the IMF's reserve adequacy ratio (ARA). This result reflects the National Bank's net foreign exchange purchases of more than USD 3 billion in previous years, which were supported by both the de-dollarization process and financial inflows, as well as valuation gains from the increase in the price of gold," the IMF notes.The report also highlights that Georgia’s banking sector is healthy. Banks are well-capitalized, liquid, and profitable, and the share of non-performing loans remains low.“Sound macroeconomic management and macroprudential policies have facilitated the further de-dollarization of the economy. In addition, the dollarization of deposits has declined, driven by improved market confidence and a weakening of the US dollar,” the report, prepared by the IMF’s Executive Board, says.

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In this regard, the IMF published a report, according to which the financial institution has revised its forecast for Georgia’s economic growth upward to 6.5%.“Despite elevated global uncertainty, including from the war in the Middle East, Georgia’s economy remains resilient, supported by sound macroeconomic management and strong policy buffers.Growth is expected to remain strong, though moderating, while inflation would stay above target till mid-2027 and the current account deficit would widen temporarily. Public debt is expected to remain at prudent levels, while reserve coverage would strengthen further.Policy priorities include bringing inflation back to target, continuing to build reserve buffers, strengthening central bank and state-owned enterprise governance, and advancing reforms to support job creation and competitiveness,” the IMF report said.

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Specifically, he was granted 27,783 ordinary shares, which management typically receives as salary or as a bonus.Specifically, ordinary shares are granted to managers as deferred shares under a compensation scheme that they have the option to cash out over several years, according to their contracts. In addition to share-based compensation, management also receives shares as bonuses.Among them, Kurdiani was granted shares twice in 2025 - once in March with 14,052 shares as compensation, and at the end of the same month with 40,227 shares under the Long-Term Incentive Plan (LTIP) for work performed in 2022-2024.This year, Kurdiani received 1,109 shares of TBC PLC for work performed in 2025.

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As a result of this latest purchase, the share of monetary gold within the National Bank of Georgia’s international reserves will reach 15.5%. This reflects a broader upward trend in the country’s international reserves, which have reached a historic high of USD 7.0 billion, equivalent to 114.8% of the International Monetary Fund’s Assessing Reserve Adequacy (ARA) metric.According to the National Bank of Georgia, the decision is part of the National Bank’s long-term international reserve management strategy, aimed at further diversifying its reserve assets, enhancing stability, and safeguarding the reserves against inflationary risks. Monetary gold is a widely recognised reserve asset among global central banks, serving to reduce overall portfolio risk and enhance resilience against geopolitical shocks.The National Bank will continue to manage its international reserves in strict accordance with the principles of safety, liquidity, and profitability. As these reserves continue to grow, the NBG remains receptive to additional diversification opportunities, with future decisions informed by long-term strategic objectives and international best practices.Notably, robust macroeconomic fundamentals enabled the central bank to replenish its international reserves throughout 2025. Last year, the NBG purchased USD 2.4 billion, increasing its reserves to USD 6.16 billion by year’s end. By February 2026, reserves had then reached a historic high of USD 6.65 billion.This move aligns with broader global trends, as the world’s central banks continue their longstanding practice of accumulating gold. In the first quarter of 2026 alone, central banks purchased over 970 tonnes of gold, nearly 80% of the total volume acquired throughout 2025 (1,235 tonnes). Total central bank purchases have consistently exceeded the 1,000-tonne mark for four consecutive years (2022–2025).Furthermore, central bank demand remains largely inelastic to fluctuations in the gold price, effectively providing a stable floor for its market value. The ongoing conflict in Ukraine, escalation in the Middle East, U.S.-China trade tensions, and the U.S.-Iran conflict that erupted in February 2026 have all consistently driven and reinforced a structural risk premium in gold prices, cementing its value as a premier safe-haven asset.

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According to the adopted draft law, the definition of a “small wine cellar” is changed and its maximum annual production limit is reduced from 40,000 liters to 25,000 liters.With the legislative change, the term “home wine” will be replaced by the term “natural wine”. This status envisages the production of products without the use of systemic pesticides, herbicides and other chemical synthetic agents.The draft law makes it mandatory to label certified alcoholic beverages, which will be implemented by the National Wine Agency in accordance with the procedure established by the Minister of Environmental Protection and Agriculture.In addition, under the new regulation, all categories of wine intended for both export and sale on the local consumer market will be subject to mandatory organoleptic testing. This obligation will not apply only to “natural wine”.

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In addition, as of May 31, 2026, 32,302 people have already benefited from the accumulated pension, to whom a total of GEL 160.6 million was issued as pensions.The positive result of the Pension Fund portfolios in May was mainly due to the high profitability of international stocks. The main factor behind the stock’s rise was renewed investor optimism about artificial intelligence, which was reflected in the global semiconductor, memory chip and technology companies’ share prices.The dynamic portfolio recorded the highest return of 2.49% last month, which is explained by its higher share of international stocks. The balanced and conservative portfolios, on the other hand, returned 1.99% and 1.29%, respectively.Year-to-date (YTD) returns for all three portfolios remain positive:• Dynamic Portfolio: 8.99%• Balanced Portfolio: 7.45%• Conservative Portfolio: 5.91%The Dynamic Portfolio also leads in terms of year-to-date returns, with an annualized return of 15.51%. The Balanced and Conservative portfolios have returned 13.90% and 10.40%, respectively.

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