At People’s Service
2                                         CONTENT:


    Georgian Banking Sector Highlights..................................
3




    GEORGIAN BANKING SECTOR HIGHLIGHTS
             8 Months Overview of 2007
4       GEORGIAN BANKING SECTOR HIGHLIGHTS

     Banking Sector                         2004                   2005       ...
5         GEORGIAN BANKING SECTOR HIGHLIGHTS




                               Branch Network in Georgian                ...
PEOPLE’S BANK OF GEORGIA
      Figures and Curves
7       INTRODUCTION

                                                                         People’s Bank 5 Years Ago

...
8   BRANCH AND ATM NETWORK ACROSS GEORGIA



                                            200 Branches including 9 Pavilion...
9                REGIONAL COVERAGE


                                                                                     ...
10   MISSION, VISION & STRATEGY


                                    Our Mission

                               To provi...
11   MANAGEMENT STRUCTURE


                                              Board of Directors


                           ...
12   RETAIL CUSTOMER COMMUNICATION AND SERVICE DELIVERY



      1,610,000 Clients / 550,000 Visa Cards / 200,000 Client R...
13   RETAIL BANKING - MAJOR DIRECTION


                                                                                Re...
14      RETAIL BANKING - MAJOR DIRECTION




                                         Consumer Loan                       ...
15     RETAIL BANKING - MAJOR DIRECTION




                                              Pension Loan                    ...
16   RETAIL BANKING - PRIORITIZED DIRECTION


                                                                            ...
17       CORPORATE BANKING


      Relationship with the corporate clients is one of the main strategic directions of the ...
18      CORPORATE BANKING




             From January 2007 till August the credit transactions performed
             by...
19   CORPORATE BANKING




        JSC “People’s Bank” provides services for the local municipalities in different regions...
20   CORPORATE BANKING


                                                            PAYROLL PROJECTS

        Number of c...
21   LEADER IN MONEY TRANSFERS




     People’s Bank is the leading Bank         Express Money Transfer             Expre...
22   LEADER IN PLASTIC CARD BUSINESS


             Only People’s Bank provides Card Service throughout Georgia           ...
23   SOCIAL PROJECTS

      Distribution of pensions and allowances to the retirees, refugees and internally displaced per...
24   IT INFRASTRUCTURE


       Bank in security policies supports Information Security Management Standard ISO
       179...
25            FIXED ASSETS OVERVIEW


 People’s bank owns:                            On the 17th of January 2007 CB Richa...
26   DAUGTHER COMPANIES


                                                                     People’s Post

         Peo...
27    DAUGTHER COMPANIES


                         People’s Insurance

PARTNERSHIP
              People’s Insurance is fu...
28         DAUGTHER COMPANIES


               Real Estate Development (RED)                                              ...
29   THE BANK’S STANDALONE



                                   Total Assets                                             ...
30   THE BANK’S STANDALONE



                    Interest Income                                                         ...
31   INTERNATIONAL RELATIONS



                  ● Pilot Project with “Support of Retail Banking Project, Cadastre Projec...
32   FUTURE CO-OPERATION


              “People’s Bank of Georgia” with its 200 branches (include 9 Pavilions) represent ...
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Presentacia Final

  1. 1. At People’s Service
  2. 2. 2 CONTENT: Georgian Banking Sector Highlights................................................... 4 Introduction ......................................................................................... 7 Branch and ATM Network across Georgia ......................................... 8 Regional Coverage ............................................................................. 9 Mission, Vision & Strategy .................................................................. 10 Management Structure ....................................................................... 11 Retail Customer Communication and Service Delivery ...................... 12 Retail Banking - Prioritized Direction .................................................. 13 Corporate Banking.............................................................................. 17 Leader in Money Transfers ................................................................. 21 Leader in Plastic Card Business......................................................... 22 Social Projects .................................................................................... 23 IT Infrastructure .................................................................................. 24 Fixed Assets Overview ...................................................................... 25 Daugther Companies.......................................................................... 26 The Bank’s Standalone ...................................................................... 29 International Relations ........................................................................ 31 Future Co-operation ........................................................................... 32
  3. 3. 3 GEORGIAN BANKING SECTOR HIGHLIGHTS 8 Months Overview of 2007
  4. 4. 4 GEORGIAN BANKING SECTOR HIGHLIGHTS Banking Sector 2004 2005 Since 2004 2006 Since 2005 Aug.07 Since 2006 Total Assets 1 699 154 2 548 267 50% 4 227 647 66% 6 482 463 53% Loans 964 918 1 730 467 79% 2 681 495 55% 3 940 801 47% Total Liabilities 1 326 641 2 068 780 56% 3 329 273 61% 5 303 838 59% Deposits 982 968 1 538 063 56% 2 327 897 51% 3 289 911 41% Net Profit 27 482 61 756 125% 92 970 51% 77 108 24% (on an yearly basis) Customer Allocation by Banks Market Share by Customers 64,6% 11,2% 5,8% 5,5% 3,8% 4,7% 2,3% 2,1% People’s Bank market share by Customers as of August 2007 1,800,000 1,610,000 1,600,000 1,400,000 Other 37% 1,200,000 1,000,000 800,000 600,000 400,000 280,353 Peoples Bank 200,000 145,678 138,838 96,625 119,690 58,169 63% 52,960 Peoples Bank of Procredit VTB Bank TBC Cartu Other Bank Georgia Bank Republic Bank Bank
  5. 5. 5 GEORGIAN BANKING SECTOR HIGHLIGHTS Branch Network in Georgian Peer Group’s market shares in Banking System – 2007 Net Commission Income Share in Banking 48% 24% 7% 7% 5% 3% 1% 5% System Number of units as of August 2007 Shares of Net Commission Income 220 30% 200 200 180 25% 24% 25% 25% 23% 160 2006 2007- August 20% 140 120 101 15% 100 18% 80 16% 10% 9% 60 8% 8% 8% 7% 7% 6% 6% 40 30 5% 5% 5% 28 19 19 20 13 5 0% Peoples Bank of Procredit VTB Bank TBC Cartu Other Peoples Bank of Procredit VTB Bank TBC Cartu Other Bank Georgia Bank Republic Bank Bank Bank Georgia Bank Republic Bank Bank
  6. 6. PEOPLE’S BANK OF GEORGIA Figures and Curves
  7. 7. 7 INTRODUCTION People’s Bank 5 Years Ago JSC People’s Bank of Georgia was founded by the end of 2002 year on the basis of AGRO Industrial Bank. By the Stockholders’ decision the bank all encompassed all the existing 30 branches, implementing high quality products in all regions. The result of all the taken activities is that People’s bank gained strong and stable position in the banking sector, with the biggest network in Georgia. Nowadays, the bank owns 200 units in total (branches, service centers, and pavilions) in 67 regions. In most of the regions People’s Bank is the only banking institution. The Bank Today The largest branch network 200 branches 150 ATMs 1 610 000 retail account The biggest number of International and Local Cards 550 000 International Visa Cards Backbone of Georgian Economy 850 000 Cards Issued Leader in Money Transfer 17 Money transfer systems 1 local money transfer system The only banking institution in Georgia initiating social projects The Biggest Number of Customers No. 1 in net commission incomes (c. 25%) Daughter Companies: and Branch Network People’s Insurance Company People’s Post Real Estate Development Public Investment Management Center People’s Fund High Sense of Corporate Social IT and Infrastructure: Responsibility Own processing center Partner of Georgian Government in: Distribution of Pensions and Allowances Public Register Services No. 1 Reformer in: Sound Customer Orientation Establishing Plastic Card payment at Penitentiary system- prisoners Establishing plastic card payment system in Tbilisi Public Schools and Communication Planning to establish plastic cards payment system in high education institutions and public transport
  8. 8. 8 BRANCH AND ATM NETWORK ACROSS GEORGIA 200 Branches including 9 Pavilions 150 ATMs
  9. 9. 9 REGIONAL COVERAGE Khulo Abasha Khoni Adigeni Khobi Ambrolauri Khelvachauri Aspindza Khashuri Akhalgori Kharagauli Akhalkalaki Chiatura Akhmeta Tskaltubo Akhaltshikhe Tsalka Batumi Tsalenjikha Baghdati Tsageri Bolnisi Chkhorotsku Borjomi Chokhatauri Gardabani Shuakhevi Gori Kvareli Gurjaani Kazbegi Dedoplistskaro Kutaisi Dmanisi Kobuleti Dusheti Keda Vani Zemo Abkhazia Kareli Poti Zestaponi Tkibuli Zugdidi Sighnaghi Tbilisi Senaki Tetritskaro Sachkhere Telavi Samtredia Terjola Sagarejo Tianeti Rustavi Kaspi Oni Lagodekhi Ozurgeti Lanchkhuti Ninotsminda Mtskheta Lentekhi Mestia Martvili Marneuli Liaxvi
  10. 10. 10 MISSION, VISION & STRATEGY Our Mission To provide universal, accessible and modern services to the population throughout the country Sound management Our Vision To deliver quality services at Bank’s offices. Our major priority is to ensure a steady increase of the clients’ satisfaction based on client-friendly, accurate and prompt services. Cutting-edge expertise Strategy • To promote growth of the retail banking system Cross-selling synergies • Maintain and solidify customer oriented approach u • Building banking operations complying internationa standards a ational • Maintaining leading position in servicing social projects by constant improvement of th service level s the • Offering innovative and highly competiti broad-range products to population d etitive • Placing special emphasis on the diversity, simplicity and accessibility of services s div Cost efficiency
  11. 11. 11 MANAGEMENT STRUCTURE Board of Directors General Director Infrastructure Retail Financial Risk Development Banking Support Management RB Committee MIS Credit Committee Board of Branch ALCO Committee Managers
  12. 12. 12 RETAIL CUSTOMER COMMUNICATION AND SERVICE DELIVERY 1,610,000 Clients / 550,000 Visa Cards / 200,000 Client Relationships 5 Branches of People’s Credit Branches 200 Branches including People’s Credit 9 Pavilions in Georgia, ATMs People’s Post POS People’s Insurance SMS Service Brokerage Company Real Estate Processing Center Development Company card processing center OSMP
  13. 13. 13 RETAIL BANKING - MAJOR DIRECTION Retail loan portfolio and deposit growth 80 000 Deposits Loans 70 000 67 089 65 218 60 000 54 479 51 502 51 262 50 000 48 654 45 115 45 644 45 753 46 119 41272 40 000 37 642 36 336 33 155 34 682 31 593 30 000 20 000 10 000 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Amounts in tsd GEL Auto loan Installment Amount in tsd GEL Number of borrowers Amount in tsd GEL Number of borrowers 4 000 500 3 709 3 603 3 558 3 559 3 572 3 626 450 445 450 3 500 3 356 400 3 000 2 852 360 349 350 302 2 500 300 359 357 271 2 000 250 1 529 1 675 200 1 500 1 469 1 213 1 217 1 273 150 1 118 1 000 990 100 62 500 58 47 48 50 31 33 38 45 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
  14. 14. 14 RETAIL BANKING - MAJOR DIRECTION Consumer Loan Overdraft Amount in tsd GEL Number of borrowers Amount in tsd GEL Number of borrowers 25 000 8 000 7 145 20 354 20 185 21 153 7 000 20 000 19 071 19 725 18 442 18 963 18 666 6 000 5 275 15 000 5 000 4 223 4 307 4 226 4 000 3 736 10 585 10 852 11 393 10 280 10 000 9 205 9 389 9 775 3 195 8 653 3 000 2 971 2 000 5 000 1 460 1 243 1 134 983 1 000 870 804 873 867 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
  15. 15. 15 RETAIL BANKING - MAJOR DIRECTION Pension Loan Payroll Amount in tsd GEL Number of borrowers Amount in tsd GEL Number of borrowers 20 000 120 000 18 207 18 408 18 000 17 166 16 493 100 406 99 943 16 000 100 000 99 360 99 501 15 247 95 202 92 915 14 000 13 866 80 000 12 341 78 315 12 000 72 896 10 150 9 771 10 000 60 000 9 152 7 997 8 185 8 000 40 000 6 000 5 977 4 658 4 972 4 577 4 000 20 000 7 308 8 598 8 847 8 920 9 001 8 844 8 417 2 000 6 443 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
  16. 16. 16 RETAIL BANKING - PRIORITIZED DIRECTION DIVERSIFICATION OF DEPOSITS Retail deposits Amounts in tsd GEL 34,681 Current accounts & demand deposits 48% 52% Term deposits 37,008 Current accounts & demand deposits Term deposits Amounts in GEL Amounts in GEL 40 000 40 000 37,007,831 35 000 34,035,066 35 000 34,025,644 34,680,979 33,356,935 33,062,964 32,974,972 32,739,571 32,649,864 32,567,906 30 000 29,760,436 30 000 26,945,088 25 000 25 000 24,718,115 20 000 20 000 18,762,783 15 000 15 000 12,287,152 12,778,263 11,079,882 10,696,825 10 000 10 000 5 000 5 000 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07
  17. 17. 17 CORPORATE BANKING Relationship with the corporate clients is one of the main strategic directions of the Bank. From January 2007 till August the number of corporate clients has significantly increased, which subsequently increased account balances of the corporate clients. CORPORATE LOANS GUARANTEES The main portion of corporate loans disbursed by People’s Bank is covered by the From January 2007 including August the JSC People’s Bank has central branch and the rest by other branches. As a total, according to the end of issued the various tyoes of guarantees to over 80 clients. Up to August data, the loans issued to the legal entities increased by 155%, compared to date the number of active guarantees exceeds 90, and the guar- the previous year, which is reflected in the chart below. antee portfolio equals to over GEL 10 000 000. Corporate Loan Portfolio Dynamics Total guaranteed amounts Amounts in GEL 35 000 000 7 000 000 32 340 599 6,501,261 30 000 000 29 806 320 6 000 000 28 495 639 27 199 542 25 000 000 5 000 000 20 345 414 20 000 000 19 553 388 20 037 518 4 000 000 17 795 483 15 000 000 3 000 000 2,750,395 10 000 000 2 000 000 5 000 000 1 000 000 848,187 120,000 56,670 58,650 96,500 26,869 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
  18. 18. 18 CORPORATE BANKING From January 2007 till August the credit transactions performed by the Corporate Clients has exceeded GEL 227 000 000. Top Ten Corporate Customers: KazTransGaz Credit transactions of corporate customers Telasi Amounts in GEL 50 000 000 Magti Georgian Railway 40 000 000 38,586,272 36,573,593 Energo-Pro Georgia 30,212,587 30 000 000 26,216,148 27,145,524 PSP Group 23,939,602 24,676,370 20,595,494 20 000 000 Wissol 10 000 000 GEOCELL National Agency of Public Registry Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 National Agency of Citizen Registry
  19. 19. 19 CORPORATE BANKING JSC “People’s Bank” provides services for the local municipalities in different regions of Georgia. By August 2007, the number of the local municipalities, which cooperate with us reached 57 (Regions include: Abasha, Adigeni, Ambrolauri, Aspindza, Akhaltsikhe, Akhalgori, Akhal- kalaki, Akhmeta, Bagdati, Bolnisi, Tsageri, Chokhatauri, Chkhorotsku, Dedoplistskaro, Dmanisi, Dusheti, Poti, Gardabani, Gurjaani, Kaspi, Lagodekhi, Lanchkhuti, Lentekhi, Marneuli, Martvili, Mtskheta, Mestia, Ninotsminda, Oni, Kareli, Keda, Kurta, Kutaisi, Rustavi, Sachkhere, Sagarejo, Senaki, Sighnaghi, Shuakhevi, Telavi, Terjola, Tetri Tskaro, Tianeti, Tighva, Tkibuli, Vani, Tsalenjikha, Tsalka, Kharagauli, Khashuri, Khobi, Khoni, Khulo, Kazbegi, Kvareli, Zestaponi, Zugdidi), and their common credit transactions have exceeded GEL 209 000 000. Credit transactions of municipalities Amounts in GEL 40 000 000 34,333,397 32,850,582 30 000 000 27,927,549 24,787,881 26,785,185 24,290,616 20 000 000 19,168,904 19,220,513 10 000 000 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 As a whole, from January 2007 till August the credit transactions has exceeded GEL 436 000 000. he
  20. 20. 20 CORPORATE BANKING PAYROLL PROJECTS Number of corporate customers participate in Payroll Programs provided by Peoples Bank, which simplifies the payroll procedures for the em- ployees of the bank’s corporate customers. Apart from this the owners of the payroll plastic cards can use the overdraft facilities and have an access to the consumer loans. By August 2007 the payroll cards of our bank is being used by over 93 000 people throughout Georgia. Income by Projects in 2007 Dynamics of plastic cards utilization in 2007 Amounts in GEL 100 000 90,917 93,838 Tbilisi 33,521 Kvemo Kartli 10,135 80 000 79,537 Imereti 9,272 73,799 Adjara 7,518 63,189 68,877 60 000 Shida Kartli 7,517 59,206 52,487 Samegrelo-ZemoSvaneti 6,642 Kakheti 5,626 40 000 Mtskheta-Mtianeti 5,182 Samtskhe Javakheti 4,233 20 000 Racha-Lechkhumi/Kvemo Svaneti 2,171 Guria 2,021 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07
  21. 21. 21 LEADER IN MONEY TRANSFERS People’s Bank is the leading Bank Express Money Transfer Express Money in Georgian Market in fast money Systems Commissions: Transfers Systems transfers – without account open- ing which is the most flexible, fast Amounts in mln USD • Unistream and easy way. In 2007 fast money • Bistraia Pochta 2.17 transfer system increased up to 18 • Anelik added by “Caspian Money Trans- • Money Gram fer” and “Intelexpress” systems. 1.47 • Migom • Contact • VTM 2006 2007 • Privat Money • Inter Xpress Local Money Transfer System Express Money Transfer Systems • Intel Xpress Turnover by Received Amounts Turnover by Received Amounts • Blizko B Amounts in mln USD Amounts in mln USD • TMT T • Telegiros 35.01 231.9 • Xpress Money • Kav Kavkazus 16.75 • Caspian Mon Transfer Money 147.4 2006 2007 2006 2007
  22. 22. 22 LEADER IN PLASTIC CARD BUSINESS Only People’s Bank provides Card Service throughout Georgia Cards Issued Principal Member of International Payment System – VISA 900 000 850 000 International 800 000 Visa Issuer 700 000 600 000 Visa Acquirer 600 000 500 000 Own in-house processing center 400 000 60 transaction per second 300 000 200 000 150 ATM-s 100 000 2006 August 2007 350 POS Terminals 850,000 cards issued Card Turnover 550,000 VISA cards 350 300 300 Plastic Card Market Share 250 200 173 150 100 50 Peoples Bank mln. GEL 50% 2006 August 2007 Cards withdrawal via Channel Point of Sale ATM 1,12% 27,78% Other Banks 50% Bank 71,1%
  23. 23. 23 SOCIAL PROJECTS Distribution of pensions and allowances to the retirees, refugees and internally displaced persons Services the following social programs: ● The Program on Overcoming the Unemployment ● The Program for providing help to the mothers with many children ● The Program to help socially unprotected groups The biggest Tender ever announced in the banking system of Georgia won by the People’s Bank in 2006: Distribution of pensions and social allowances ● Total Amount of 2,2 billion GEL ● Duration 3 Years Social programs Turnover Turnover by Projects in 2007 Amounts in GEL Amounts in GEL 580 000 000 570 705 884 560 000 000 Pensions 379 182 866 540 000 000 Social Support (Living) 48 612 124 520 000 000 Refugee support 24 924 148 500 000 000 481 165 517 Social Support (Family) 9 900 978 480 000 000 460 000 000 Municipal 9 529 214 440 000 000 One-time refugee support 683 900 420 000 000 2006 Aug - 2007 President’s employment program 69 150 Incomes from Social programs Income Share by Projects in 2007 Amounts in GEL Amounts in GEL 10 800 000 10 678 509 Pensions 6 066 925 10 600 000 Social Support (Living) 777 793 10 400 000 10 200 000 Refugee support 473 558 10 000 000 Social Support (Family) 158 415 9 800 000 9 600 000 9 670 338 Municipal 152 834 9 400 000 One-time refugee support 11 737 9 200 000 President’s employment program 691 9 000 000 2006 Aug - 2007
  24. 24. 24 IT INFRASTRUCTURE Bank in security policies supports Information Security Management Standard ISO 17999. Bank has two load balancing server rooms. All operations done centralized based. Bank uses servers from IBM and HP. Virtual Private Network (VPN) includes more then 180 points of services with 3500 users working. All accesses to VPN done from the one central point – Head Office. Network is based on Cisco Systems equipment and uses Triple Data Encryption Standard for encryption. Physically network uses Fiber Optic connections, WiMax and GPRS. Bank has own processing center, connected to VISA. Communication standards comply VISA defined standards. Purchase of a new banking software Profit from the Greek company INTRACOM IT Expenses 2005 2006 As of August 2007 2 000 000 1 906 128 1 835 000 1 800 000 1 600 000 1 400 000 1 200 000 1 200 000 1 000 000 881 810 810 000 820 000 800 000 650 000 600 000 594 933 500 000 400 000 200 000 Hardware Software ATMs Hardware Software ATMs Hardware Software ATMs Amounts in GEL
  25. 25. 25 FIXED ASSETS OVERVIEW People’s bank owns: On the 17th of January 2007 CB Richard Ellis has inspected the People’s bank central office building and has made all appropriate enquiries in order 5 Buildings in Tbilisi to advise to Bank as to its opinion of the market values as at the date of valuation and as defined in the basis of valuation herewith: 69 Buildings in Regions Value assuming a complete renovation and transformation into a First Class 9 Pavilions office building 38 Armoured Vehicles To be completed To be completed l t d US$ 31,000,000 by the end of 2007 40 Passenger cars At the end of 2006 year the building was owned by Real Estate Develop- ment (RED) which is People’s Bank Daughter Company. In February 2007, the building became under People’s Bank ownership and was accounted p p in its balance with value of 24 mln. GEL. l Up to date “People’s Bank” has d Net Fixed Assets Types of Net Fixed Assets - August 2007 placed 9 pavilions throughout the city. All of them offer the same ser- o Amounts in tsd GEL 50 000 Amounts in tsd GEL vices and banking products as the oducts th 45 000 46 528 Buildings 30 573 branches and servic centers do. ches service 40 000 Intangible Assets 2 586 35 000 Computer equipment 2 539 30 000 25 000 Leasehold improvements 2 422 20 000 Vehicles 902 17 609 15 000 Construction in progress 715 11 116 10 000 Furniture and fixtures 294 7 202 5 000 Land 25 2004 2005 2006 Aug-2007
  26. 26. 26 DAUGTHER COMPANIES People’s Post People’s Post was founded in October 2005 but it started active operations on Georgian postal market from October 2006. Nowadays, 187 branches of “People’s Post” are spread throughout the whole country. Company’s staff has its own auto park, which is equipped with 28 trucks and vehicles of special use. “People’s Post” participates in a communications network of “People’s Bank” and with its help provides quick and trustworthy postal service. Together with the 1.5 million clients of “People’s Bank”, Already signed Agreement on conducting Money Transfer System Western Union. “People’s Post” offers to the customer’s wide range of postal and postal-financial services across the country. Services offered: Postal Services: • Letters and postcards • Parcels • Courier services • Commercial correspondence service, provided with pre-paid re d sponse; Sales Dynamics • Provision of mail boxes; • Establishment of an enclosed post-office; • Delivery of utility and other bills; 3rd Qtr • Delivery of goods purchased online; • Facsimile service. Financial Services: 2nd Qtr • Pension delivery, pecuniary aid to disadvantaged citizens and other t d social allowances payment; • Money transfers; 1st Qtr • Payments of utility and other bills; • Delivery of banking services “at their doors”; ” • Delivery of insurance policies or other services “at their doors”. c “a 10 000 20 000 30 000 40 000 50 000 60 000 70 000
  27. 27. 27 DAUGTHER COMPANIES People’s Insurance PARTNERSHIP People’s Insurance is fully licensed, international and Europe- Products for Individual and an standards oriented Georgian Insurance company. 2005, “People’s Bank” of Georgia bought 100% of stocks and Corporate Clients became single shareholder. Company’s Capital amounts over GEL 2.040.000 – twice up ● Property Insurance than legislation standards require. ● Cargo Insurance Company is mostly oriented On Health Care Insurance. Com- pany’s Heath Care Policy holders are 4,000 People’s bank staff ● Motor Insurance members and 10,000 individual persons. ● Travel Insurance PIC’s strategy is focused on sustainable and profitable growth, ● Accident Insurance on the efficient use of capital and on close and mutually re- warding relationship with clients. We make business to look ● Third Party Liability Insurance after every need of our clients. ● Health Insurance The Products business function actively promotes innovation s ● Motor Accident Insurance In and the development of new, superior products which meet the increasingly demanding requirements of clients. Company t ● Credit Life Insura ance seeks new target groups and is oriented on promotion of in- m surance culture. Key mandates of this business function include managing th the PIC Financial Information 2007 (2-nd quarter) insurance cycle to consistently optimize long-term profit levels, le and implementing client-focused claims management stan- e nt Gross Premium (GEL) 1.073.563 dards in all markets and lines of business. ROE 12.95% ROA 9.45% Loss Ratio 19.81% Gross Profit Margin 30.67%
  28. 28. 28 DAUGTHER COMPANIES Real Estate Development (RED) Public Investment Management Company (PIMC) LTD Real Estate Development was founded by JSC People’s Public Investment Management Company (PIMC) is a daughter brokerage Bank in 2005. company of People’s Bank founded on July 31, 2006. The bank is single shaereholder and holds 100% of shares. It started its active operations last October after it had obtained general li- Common Stock of the company totals GEL 89 250. cense from the national commission of securities and become the member of The main directions: national securities exchange. In the short period of time PIMC gained a popular image in the financial mar- ● Real estate management ket of the country. ● Building – reconstruction The company carries out its legal activities on the whole territory of Georgia through People’s Bank branches. ● Project creation PIMC offers the customers a wide choice of services in four main directions: ● Renting of commercial spaces ( 500 bus stops) ● Consulting service ● Brokerage service g ● Assets management Financial information 2007 ● Investment bankin banking PIMC considers the cooperation with leading compa onsiders companies of the country very critical. In this case the company is not only guided by commercial interests cal. Assets but also takes state interest into account. The projects to be implemented in projec ed 1 294 029 the nearest future prove the above. The future proje ects will conside onsiderably im- prove the financial market of the country and attract foreign investments. y reign Income 1 076 492 Capital 89 250 Profit 135 379 200 000 400 000 600 000 800 000 1 000 000 1 200 000 1 400 000
  29. 29. 29 THE BANK’S STANDALONE Total Assets Gross Loans Amounts in tsd GEL Amounts in tsd GEL 250 000 900 000 83 602 800 000 214 832 200 000 700 000 600 000 150 000 500 000 49 417 111 743 400 000 100 000 79 365 300 000 28 851 58 475 19 115 200 000 50 000 35 253 10 086 100 000 2003 2004 2005 2006 Aug. 2007 2003 2004 2005 2006 Aug. 2007 Total Liabilities Client’s Deposits Amounts in tsd GEL Amounts in tsd GEL 2 000 000 180 000 169 724 181 751 1 800 000 160 000 1 600 000 140 000 1 400 000 120 000 1 200 000 100 000 1 000 000 86 513 94 885 80 000 800 000 68 876 60 000 600 000 50 651 51 010 40 000 38 829 400 000 26 445 25 047 200 000 20 000 2003 2004 2005 2006 Aug. 2007 2003 2004 2005 2006 Aug. 2007
  30. 30. 30 THE BANK’S STANDALONE Interest Income Non Interest Income Amounts in tsd GEL Amounts in tsd GEL 9000 20000 8,499 17,578 8000 18000 7000 16000 14000 6000 12000 5000 10000 4000 8000 3,180 12,895 3000 6000 2000 4000 1000 2000 Aug 2006 Aug 2007 Aug 2006 Aug 2007 Total Income Amounts in tsd GEL 12000 26,077 10000 16,075 8000 6000 4000 2000 Aug 2006 Aug 2007
  31. 31. 31 INTERNATIONAL RELATIONS ● Pilot Project with “Support of Retail Banking Project, Cadastre Project of KFW and People’s Bank” – financed by People’s Bank (credit facilities to farmers in Adjara re- gion) ● Partner Bank of SBFIC (Savings Banks Foundation for international Cooperation) – Technical Assistance financed by KFW and GTZ ● Member of Banking Associating for Central and Eastern Europe BACEE ● Principal Member of international payment system – VISA International ● Swiss Agency for Development and Cooperation – Poverty reduction project for vul- nerable families ● S.W.I.F.T. – Society for Worldwide Interbank Financial Telecommunication ● TGBR – The Global Banking Resource anking ● Partnership with American Express – (500 thsd. USD Credit Line for Travelers e . Cheques) ● America’s Chamber of Commerce ● Deutsche Bank AG ● Dresdner Bank AG ● DZ Bank AG ● Wincor - Nixdorf – Strategic Partner for providing Banking Equipment a gic ments ● CHF- Co-financing of agro sector across Georgia r ● IFC- Corporate governance project n n ● Conducting Credit Assessment of People’s Bank by FITCH s sment
  32. 32. 32 FUTURE CO-OPERATION “People’s Bank of Georgia” with its 200 branches (include 9 Pavilions) represent the widest network in Georgian banking system. By its placement bank’s 36 branches are distributed in regions where they are the only representatives of a banking system, which is the half of the whole Georgian ter- ritory. Majority of population every day uses the services of “People’s Bank” and this fact gives the consideration that bank can strengthen trust between banks and customers. Beginning from its foundation, main goal of “People’s Bank” is to suggest unique, trustworthy, high quality and modern banking products to the all levels of population throughout the whole country. Short – Term Goals: ● Candidate for the second round of CGF (Credit Guarantee Fund) Project - financed by KFW (SME Support in Georgia) ● Candidate for the second round Agriculture Development Project of the World Bank ● Planning to be a Principal Member of international payment system – MasterCard Long – Term Goals: ● To build a sound regional financial institution represented in Caucasus Region ented Reg Caution Regarding Forward-Looking Statements This presentation contains statements that constitute “forward-lookin statemen m nts “forward-looking ments”, including, but not limited to, statements relating to the implementation of strategic initiatives and othe statements relat- ini nd other ing to our business development and financial performance. n While these forward looking statements re resent our judgment sand future expectations concern- ments represent ud ment sa ns ing the development of our business, a number of risks, uncertainties and other factors could cause s, aus actual developments and results to differ materially from our expectations. ffer

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