Strength in Georgian business underpins Q4 growth for TBC Bank

(Sharecast News) - TBC Bank Group reported a 16% year-on-year increase in fourth-quarter profit on Friday, as strong income growth in Georgia offset softer earnings momentum in Uzbekistan, while the board proposed a higher final dividend for 2025. The FTSE 250 lender posted net profit of GEL 387m (£107.31m) for the three months ended 31 December, up from GEL 335m a year earlier, delivering a return on equity of 24.9%, compared with 24.1% in the prior-year period.

For the full year, net profit rose 9% to GEL 1.42bn, with an ROE of 24.2%, down from 25.6% in 2024 but above the group's 23%+ target.

Fourth-quarter net interest income increased 23.3% year-on-year to GEL 626m, while net fee and commission income rose 9.4% to GEL 162m.

Total operating income climbed 15% to GEL 901m.

Credit loss allowances totalled GEL 87m in the quarter, versus GEL 75m a year earlier, while operating expenses increased 9.6% to GEL 336m, resulting in a cost-to-income ratio of 37.3%, down from 39.1% a year earlier.

Earnings per share rose 16.9% to GEL 6.91.

For the full year, net interest income grew 23.7% to GEL 2.35bn and net fee and commission income rose 18.5% to GEL 617m, lifting total operating income by 19.6% to GEL 3.39bn.

Operating expenses increased 18.3% to GEL 1.27bn.

The cost of risk rose to 1.5% from 0.8% in 2024, reflecting higher provisions, particularly in Uzbekistan, while the net interest margin improved to 7.0% from 6.7%.

Gross loans increased 12.8% year-on-year to GEL 30.15bn at year-end, with customer deposits up 12.2% to GEL 25.66bn.

Total assets rose 9.4% to GEL 43.94bn and total equity increased 10.6% to GEL 6.35bn.

The group's CET1 capital ratio stood at 16.6% in Georgia and 18.2% in Uzbekistan, both comfortably above regulatory minima.

In Georgia, fourth-quarter net profit reached GEL 381m, up 15% year-on-year, with an ROE of 25.7%.

For the full year, Georgian operations generated GEL 1.38bn of profit, up 8%, with an ROE of 24.3%.

The Georgian loan book expanded 10.7% year-on-year to GEL 27.6bn, while deposits, excluding Ministry of Finance balances, rose 11.2% to GEL 24.11bn.

Uzbekistan delivered 24% year-on-year growth in fourth-quarter operating income to GEL 171m, but net profit fell 13% to GEL 32m, with an ROE of 16.4%, as higher provisions weighed on earnings.

For the full year, operating income surged 67% to GEL 690m and net profit increased 15% to GEL 127m, with an ROE of 18.4%.

The Uzbek loan book grew 45.1% year-on-year to GEL 2.55bn and deposits rose 40.1% to GEL 1.48bn, though the cost of risk climbed to 10.2% from 6.3% in 2024.

"I am pleased to report a strong final quarter for the year, building on the momentum gained over the previous quarters and resulting in an impressive full-year performance," said chief executive Vakhtang Butskhrikidze.

He added that the group's "strong and consistent performance, supported by a robust capital position, enables us to continue returning capital to shareholders."

The board recommended a final dividend of GEL 3.87 per share, subject to shareholder approval, bringing the total dividend for 2025 to GEL 8.87 per share, up 10% year-on-year.

Including a GEL 75m share buyback, total capital returns for the year amounted to GEL 564m, representing 40% of net profit.

The final dividend was scheduled to be paid on 22 June to shareholders on the register as of 22 May, with the sterling conversion based on the five-day average exchange rate published by the National Bank of Georgia from 1 to 5 June.

At 1049 GMT, shares in TBC Bank Group were up 3.84% at 4,465p.

Reporting by Josh White for Sharecast.com.