Earnings call transcript: TBC Bank Q3 2025 sees shares drop despite profit growth

TBC Bank Group PLC’s third-quarter earnings call revealed a robust financial performance with a 6% year-over-year increase in net profit to 368 million Lari. Despite this, the company’s stock fell sharply by 11.18% in pre-market trading, reflecting investor concerns over future guidance and market conditions. The bank’s revenue surged by 17% year-over-year, driven by strong loan book growth and digital ecosystem expansion.

Key Takeaways

- TBC Bank reported a 6% increase in net profit to 368 million Lari.

- Revenue grew by 17% year-over-year, significantly boosting financial performance.

- Stock fell 11.18% in pre-market trading, reflecting investor concerns.

- The bank expanded its digital ecosystem, reaching 22 million registered users.

- Focused on SME lending in Uzbekistan amid regulatory challenges.

Company Performance

TBC Bank demonstrated strong performance in Q3 2025, with net profit increasing by 6% year-over-year to 368 million Lari. This growth was supported by a 24% rise in net interest income and a 17% increase in revenue. The bank’s return on equity stood at 24.4%, indicating efficient use of equity capital. TBC Bank’s digital initiatives also showed promising results, with 22 million registered users and a 46% daily active to monthly active user ratio.

Financial Highlights

- Revenue: 880.2 million Lari, up 17% year-over-year

- Net profit: 368 million Lari, up 6% year-over-year

- Return on equity: 24.4%

- Net interest income: Up 24%

- Cost-to-income ratio: 37.7%

Market Reaction

Despite strong financial results, TBC Bank’s stock dropped by 11.18% in pre-market trading, closing at 4,295 Lari. This decline may reflect investor concerns about the company’s future guidance and potential regulatory challenges in the Uzbekistan lending market. The stock remains within its 52-week range of 2,895 to 5,070 Lari.

Outlook & Guidance

Looking ahead, TBC Bank aims to focus on SME lending in Uzbekistan, anticipating that net interest margin (NIM) will remain around 6% in Georgia. However, the bank acknowledged potential regulatory challenges in Uzbekistan, which could impact its lending strategy. The company aims to achieve slightly below its 1.5 billion Lari net profit target.

Executive Commentary

"We have built one of the fastest growing digital banking ecosystems globally," said Vakhtang, CEO of TBC Bank, highlighting the company’s digital expansion efforts. Oliver Hughes, Head of International, added, "The SME banking opportunity is huge in Uzbekistan," indicating the bank’s strategic focus on this segment.

Risks and Challenges

- Regulatory challenges in Uzbekistan could impact lending operations.

- Inflationary pressures in Georgia and Uzbekistan may affect consumer spending.

- Competitive pressures in the digital banking space could impact market share.

- Potential changes in risk weightings for loans in Uzbekistan could affect profitability.

- Currency fluctuations in the Lari could impact financial results.

Q&A

During the Q&A session, analysts inquired about the impact of new risk weightings on the Uzbekistan loan portfolio and the bank’s strategy to address regulatory shifts towards SME lending. Executives also clarified the company’s fee income strategy and future growth expectations.

Full transcript - TBC Bank Group PLC (TBCG) Q3 2025:

Sam, Call Moderator: IS TBC third quarter and nine month 2025 IFRS results conference call My name is Sam and I’ll be the call moderator today. All participant lines are currently muted. After the prepared remarks, there’ll be a question and answer session. If you’d like to register a question throughout the call, please use the Raise Hand button on your Zoom toolbar. Alternatively, you can submit a question in writing using the Q and A function on Zoom. And if you’ve dialed into the call today, you may register a question by pressing STAR followed by one on your telephone keypad. I’ll now like to hand you over to today’s host, Andrew Keeley, Director of Investor Relations to begin. So Andrew, please go ahead.

Andrew Keeley, Director of Investor Relations, TBC: Thank you very much Sam and welcome everybody to our third quarter results call. I’m joined on today’s call by Vakhtang but our CEO by Giorgi Meghrelishvili, our cfo, and by Oliver Hughes, our Head of International. As usual, we’ll have a presentation and then we’ll run through and have a Q and A session afterwards. And with that I’ll hand over to Vakhtang. Thank you.

Vakhtang, CEO, TBC: Thank you Andrew hello everyone and thank you for joining us today. I am pleased to present another highly profitable quarter with record quarterly earnings. As you can see, our group’s net profit in the third quarter is 368 million Larry up by 6% year on year while return of equity was 24.4%. Our revenue growth was very respectable 17% year on year growth. In Georgia we had the strongest stable quarter with 24% plus return of equity, 9% growth in our loan book and net interest margin reaching 6% over the same period. Uzbekistan’s net profit was 41 million Lari are by 30% year on year with return of equity exceeding 23%. While the loan book has almost doubled year on year to close to $1 billion. Our digital ecosystem continues to expand its reach with registered users totaling almost reached 22 million up by 28% year on year.

As a result of our strong operating performance and the solid capital base, the board has declared a quarterly dividend of 1.75 lari per share, bringing the total nine months of 2025 dividend to 5. Larry now turning to Georgia, Georgia’s economy continues to perform strongly. Real GDP growth stood at 6.5% in the third quarter, bringing nine months growth to 7.7%. While our macro team has revised its 2025 GDP growth forecast upwards to 7.3%. The inflation rate reached 4.8% in September surpassing the National bank of Georgia’s 3% target, but we expect these to ease slightly over the next few months. Next slide highlights the highly consistent performance of our Georgian financial services business as we continue to deliver close to mid-20s return of equity.

The reason for this consistency as you can see that we continue to be a leading player across most of the key banking segments in Georgia. In the third quarter our gross loans were up by 9% year on year and I’d like to highlight particularly strong performance in fast consumer lending, a key focus for us, where our loan book portfolio grow by 42% and we have gained 3 percentage points of market share over the past year. Meanwhile, our Georgian customer deposit increased by 11% over the same period. We continue to maintain a strong position in both lending and deposits while constantly improving how we serve our retail and business clients. Next slide illustrates the growing digital engagement among our retail customers in Georgia.

By the end of September, our digital monthly users reached 1.2 million, accounting for two thirds of our active customers and our digital MAU continues to increase by around 50,000 users per quarter. What’s also important is that our digital users are highly engaged with us on a daily basis as it reflected in a very impressive 46% Dow to Mao ratio. The increasing take up of digital banking by our customers is also reflected in the very high levels of digital loss and deposit issuance. Now let’s turn to our Uzbekistan business. Starting with the economy, much like Georgia’s Uzbek economy, also remains highly dynamic with real GDP growth of 8.2% in the third quarter bringing nine months 2025 growth to 7.6%. What is very encouraging is that inflation is also easing, dropping to 8% in September and even lower in seasonality adjusted terms supported by tight monetary policy.

And we have also seen local currency strengthening this year. Next slide provides an overview of the progress that we have made over the past two years across all major metrics. We have almost 22 million unique registered users out of which almost 6 million are massive active users. Our loan book continues to almost double year on year and now tops $970 million while our deposits increased by 71%, reaching over $540 million. Our operating income reached a record $70 million in this quarter and increased by 69% year over year. In the third quarter net profit our Uzbekistan business reached $15 million, up by 30% year on year. Now let’s turn to some of our recent business updates. In Uzbekistan we continue to expand our digital banking in the third quarter.

In the third quarter we announced our planned acquisition of Majority Staking Nolex, the country’s largest online classified platform. This will unlock powerful synergies with our financial services platform and help increase our share of customer retention. We also saw a great progress in the uptake of Salon Card. By the end of September we issued 700,000 cards of which 500,000 have been funded as customers are increasingly choosing TBC for their daily banking needs. In addition, we have been dipping customer engagement in PayMe with PayMe plus subscriptions reaching 300,000. Maui we keep scaling the use of AI throughout our business. As a result, we have reached 90% automation in early stage delinquency calls and we have conducted over 100,000 sales per month with our AI voice chatbots.

Evidence of the popularity of our ecosystem can be seen in it being the top of Mind bank brand in Kashkent and number three in Uzbekistan as a whole. A great achievement in just a few years of operating. Next slide shows our increasing market share and contribution to the group by the end of the third quarter. Market share of our retail loans and deposits to debt 4.9% and 4.2% respectively. In the third quarter Uzbekistan contributed 11% of the group’s net profit while the contribution in operating income was 21%. Next slide provides an update on the targets we set ourselves for our Uzbekistan business. I think it is worth stepping back for a moment and considering what we have achieved in Uzbekistan over the past six years. During this time we have built one of the fastest growing digital banking ecosystems globally.

Our registered users have increased tenfold to 22 million and we have built a $1 billion loan portfolio. Our digital bank broke even in just two years and is already generating 20% return of equity despite being a yearly stage business. This year we have scaled up, launched new products and announced highly value accretive M and A with Bills and Olex and we are a top 10 player in retail banking and even the top of Mind bank in Tashkent. But of course there has been some challenges this year. As you know we had issues around fraud and asset quality in the first half while in the second half we had pivoted our business from micro loans to SME lending more quickly than we had anticipated in line with the changing regulatory agenda. As a result, we expect to be below our 2025 net profit guidance.

I firmly believe that we have a flexible and resilient business model and an excellent team that will enable us to adapt quickly to the evolving environment and we remain highly positive on the long.

Term growth opportunities in the country.

Finally, I’d like to provide an update regarding group’s targets. First of all, I’d like to stress that the group’s overall performance remains strong and resilient. Our return of equity has consistently been running ahead of the challenging 23% target and since the start of 2023 we have almost doubled our digital MAU to close to 7 million as more customers choose TPC. Over the past three years we have increased gross profit annually by 10% despite investing carefully in building out Uzbekistan. However, given that we are running below our profit targets in Uzbekistan, Group’s net profit will slightly below our 1.5 billion Larry target. As a group we are well positioned for the future.

We combine consistently and proven leadership in Georgia with a dynamic digital ecosystem in Uzbekistan that is well placed to capture the huge opportunity available and remain highly positive on the long term growth opportunities in both markets. With that I pass over to Georgi.

Giorgi Meghrelishvili, CFO, TBC: Thanks Waktank and thanks all for joining our quarterly call. Now I will go into more details for our financial performance and we’ll start with slide 18. So it has been a strong quarter with the record profit as Waktank mentioned with 368 million lar. That is up 6% both quarter on quarter and year. On year basis our nine months profit surpassed 1 billion threshold and that’s actually again 6% up compared the same period last year. So that translated into a very nice and strong 24.4% ROI. So if you go to next slide slide 19 I would like to discuss the drivers of this performance. As you can see our top line growth has been very strong 17% year on year. That was mainly driven by our net interest income growth 24% really solid growth.

Our non interest income also grew by 6% on quarter on quarter and 3% year on year. This I would say slowdown in growth driven mainly by two factors fee and commission income in Georgia because of the increased card network fees and also we do invest a lot into our TBC card cashbacks loyalties. That’s becoming a go card and we do expect this trend as well to continue. The second reason is that Larry has been very stable this year, a good sign. However the margins compressed significantly compared to last year but despite that we still delivered and we were flat as last year for the nine months.

So Andrew if you go to next slide slide 20 so and if you look now our NIM dynamics we are very pleased to see that we retained 7% level and we expect to stay at this level for a while. And actually another nice development is that in Georgia we are back to 6% handle from 5.9 last quarter. And also we do expect to retain around this level in Georgia. Maybe high 5, low 6, but more or less the level we are in Q3. So let’s move to Slide 21. Our cost dynamics, our OpEx was up by 18%. Probably the trend we have seen nothing unexpected because we do continue to invest into our businesses in both countries, particularly into Uzbekistan. However, our cost income ratio remains broadly very stable.

So it was 37.7% more or less the same as in Q2 last year and also 9 months trend is kind of more or less the same and aligned. Now if we go to slide 22 turning there, our credit quality cost of risk remains the same for the group and for Georgia as well. For group it was 1.6% for Georgia 80 basis point. So that’s the level we have seen for the last few quarters. Very good level. We are very comfortable with this level with our credit quality. Uzbekistan cost of risk ticked down slightly 20 basis points to 9.7%. However, we still do see the less impact of our sin file, consumer segment testing and long tail post merchants. So we do expect this trend to remain for a quarter or two going forward. Now going to Slide 23, our balance sheet grows.

It was very healthy. 13% for the group was for customer funding and loans. However, I would also like to comment on Georgian growth that was a bit subdued this quarter. That was driven by one of a larger repayment in our corporate business. In Q4 we do expect to go back to our normal growth mode and we do expect this year to be double digit growth. Now turning to slide 24 and our capital positions, they remain very strong in both countries. We are well above our regulatory limits in both countries. And exactly these strong capital levels, if you go to slide 25 turn to that will allow us to continue returning capital to our shareholders. We repaid 175 Larry in Q3. That brings our overall distribution to 5 Larry this year and that’s combined with 75 million Larry buybacks that’s still ongoing.

We are more than halfway through. So on this note I would like to thank you and now we can deep dive more into our TBC Uzbekistan business. Oliver, please go ahead.

Oliver Hughes, Head of International, TBC: Thanks Gyorgi. Yeah.

So I’m going to give you a bit more color on what’s happening in Uzbekistan and what’s been happening over the last three quarters.

As you know, it’s been a mixed year for TBC Uzbekistan in 2025 with lots of positive developments happening operationally, but a fair number of challenges as well.

This sometimes happens in business and the.

Important thing is how the team reacts to these situations when they arise. I’ll start with the positives. We’ve scaled up our business considerably and launched new products. Our loan book has grown by over 90% year on year and isn’t far off $1 billion. We are now a top 10 retail bank in Uzbekistan in both lending and deposits. We’ve made great progress in building one of the best consumer daily banking offerings in the market. We already have over 700,000 issued and half a million funded Salon Cards which is our Flagman debit card. We’ve launched Business Lending, which already accounts for above 10% of our loan book and digital insurance with over 300,000 policies issued.

We’ve announced two great MA deals as Rajo mentioned, a partnership with Bills which gives us access to a huge network of retailers and the acquisition of a majority stake in olx, the country’s largest online classifieds which will unlock powerful synergies with our own financial services platform. These deals help us deepen our relationships.

With our B2B and B2C customers.

We’ve made great progress in building an AI powered bank with our proprietary AI stack and our own AI voice assistant coming soon. We more than doubled our gross revenue year on year in nine months to $350 million. And despite investing heavily in all aspects of the business, we’ve also increased earnings by almost 30% year on year with close to 20% ROE which isn’t bad for a digital bank that has just.

Celebrated its fifth birthday.

We’ve also had several challenges which I.

Will describe in brief here.

In quarter one we were hit by an external market wide fraud. The P and l impact was $9 million. We owned it, dealt with it in quarter one by provisioning the loss and moved on. In quarter two our cost of risk increased, mainly from tests that we’d been conducting to find new segments and channels in which to grow our business going forward. There were also some scaling related issues in collections. We made adjustments to our operations, took a more conservative approach to underwriting and we believe that our credit risks have now more or less topped out. The loans that we booked were overwhelmingly NPV positive, but we understand that optics are also important. Also in quarter two the regulator tightened the KYC requirements for payments platforms, meaning that in effect we had to re register all of our 3.9 million pay me MAU.

Not only did this cause a dip in MAU which is now recovering. It also led to a slowdown in payments volumes and fee and commissions income in quarter three. In line with the regulator’s agenda of pivoting the national loan book towards SME, we had to slow down our disbursement.

Of microloans or unsecured personal loans.

This in turn has had an impact on cost of risk because the front book is not growing as planned, which means that the risk in the back book is not being diluted as quickly as anticipated. This also hit our revenue and in turn our bottom line. As we have been highlighting, retail lending and particularly unsecured consumer lending is at a very early stage of development. In Uzbekistan, total retail loans to GDP are just 12% while unsecured consumer loans to GDP and just 4%, albeit this has been the fastest growing segment over the last past couple of years. Back at the end of last year we were working under the assumption that consumer facing products, including unsecured consumer loans of different types would be a key driver of our portfolio growth for the next few years.

However, since the beginning of this year there has been a major change in the regulatory agenda in favour of promoting SME lending whilst becoming increasingly negative towards consumer loans, in particular microloans which are perceived as inflationary and something that the population is not yet ready to adopt widely. After the shift in the central bank’s agenda, a fairly rapid but nonetheless staged market rebalancing from consumer lending to SME lending was implemented through the announcement of market wide portfolio caps to be introduced by 1st January 2029.

As we discussed on our first quarter.

Call over the past couple of months the regulators requested that we accelerate our.

Disbursement of business loans.

In addition, the CBU has recently proposed new risk weights on unsecured consumer loans. These risk weights are based on the portfolio share of unsecured consumer loans, microloans, credit cards and overdrafts and will be introduced from 1st July 2026 according to the CBU letter, which could still be subject to change. If a bank’s share of microloans or credit cards is higher than 25%, the risk weights applied to that part of the unsecured consumer loan book will vary from 150% to 250% depending on the share of these unsecured loans in the total loan book. As things stand, we expect to have 50 to 75% share of microloans in the loan portfolio. It now stands at 79% which would imply 200% risk weighting for the microloan book.

If introduced in the current form, this would a have a negative impact on our capital ratios and b worse than the economics of microloans. So this is the regulatory environment in which we are working. As you know, in response to the CBU’s introduction of portfolio caps and strong desire for the market to recalibrate, we accelerated the launch of SME lending in April. This now accounts for around 15% of our total loan book and we are ramping up this business. However, it is now clear that we will have to further pivot away from unsecured consumer lending to business lending and secured lending as Vakhtang covered earlier on this call.

This all means that while we are on track to hit our 5 million Mal guidance and 80% loan CAGR targets, we are going to be below the highly ambitious net profit guidance we set ourselves back in 2023, for which I apologize. As you know, we will be holding a Strategy Day in late February at.

Which we will update the market on.

Our longer term outlook, but it feels appropriate to outline some of our very initial thinking on 2026. First of all, we still see massive long term potential in Uzbekistan as we continue to build out the largest digital.

Banking ecosystem in Central Asia.

As previously communicated, the SME banking opportunity.

Is huge in Uzbekistan.

This will be a key business priority in 2026 and beyond, providing us with new sources of growth as well as aligning us with the priorities of the government and the regulator. We will look to move into new business lines in secured lending in 2026. We have the expertise and platforms to do this and it provides another large opportunity in the country. We will continue to grow our loan.

Book in segments of unsecured lending such.

As credit cards and BNPL or instalment loans. We have already issued 85,000 Osmond credit cards accounting for 5% of our loan book. In 2026 and beyond we hope that Salon Card will become the go to product for affluent and mass affluent customers to conduct their daily banking. We will further integrate our two sided ecosystem, connecting our 22 million registered users on the one side with our exposure to tens of thousands of enterprises on the other. In 2026 we will integrate our CRM and loyalty platforms and start leveraging the.

Opportunities created by our acquisitions of bills and olx.

We have a strong largely proprietary tech platform including our speech tech platform, on the base of which we’re launching a.

Range of interesting AI driven services over.

The coming months including and first and foremost our own in app voice assistant called Lola. Last but not least, we have an amazing, experienced and ideas driven team that has been through many different situations in many different markets. We know how to build good product and cx, which is exactly what we will continue to do. So thank you.

And now over to Q and A.

Andrew Keeley, Director of Investor Relations, TBC: Thanks very much all of you for the presentation. Okay, so we can start with questions. I think first up is Piers Brown from Investec. Piers, go ahead please. Piers, you can, you can go ahead.

Giorgi Meghrelishvili, CFO, TBC: Yep.

Piers Brown, Analyst, Investec: Can you, can you hear me okay.

Andrew Keeley, Director of Investor Relations, TBC: Yep, we can.

Sam, Call Moderator: Yep.

Piers Brown, Analyst, Investec: Good afternoon, everybody. Yeah, so I have one on Uzbekistan and one on Georgia. So this is probably one for Oliver. Thanks for all of the background information on the risk rating changes. Oliver, that was very helpful. I’m just thinking in terms of the, I mean, you mentioned this increase up to, I think you said 200% on the micro loans. How impactful is that for your capital ratio in Uzbekistan? And I guess, you know, the question is, do you have sufficient capital in place currently to absorb that level of risk weighting increase and then allied to that, how likely is it these caps may be amended or the risk rating proposals may be amended and are you still covering your cost of capital at that level of risk rating? So those are my questions on Uzbekistan. I don’t know.

Shall I ask the question on Georgia or would you like to address that for us and then let me answer.

Oliver Hughes, Head of International, TBC: The Uzbek piece first. Yeah, so thanks for the question, Piers.

So the first question was on the.

Impact on the capital ratio of the proposed risk weights, which we have been notified will come into effect from the 1st of July next year. And the answer is we, we have.

Capital to cover it.

So the way this works is that.

It’S based on the share in the loan portfolio.

Yeah.

In the loan book.

So our share of micro loans, which is obviously. So these are unsecured personal loans or cash loans, is going down because our.

Share of other products is going up.

First and foremost, SME, which is growing at a clip.

And we will be accelerating that.

We’re gathering data, we’re getting better at it, we’re learning how to do the.

Job, which will bring our share of.

Micro loans, as they’re called in uzbekistan.

Down below 75% and depending on how it goes, maybe below 50%, maybe not.

By the first of July, because that’s only in seven, eight months, but certainly not long thereafter.

So there will be a reduction in our capital adequacy ratio for a period.

Of time, but as our share of.

Micro loans goes down, then it will reset. So there’ll be a period of time from the 1st of July, let’s say for a few months while we’re still above 50% but then microloans will go.

Below 50% and our capital adequacy ratio will go up organically, as it were, as the risk weights run off. So that’s how you should think about this.

We don’t need to inject additional capital.

So that is on the risk weights.

And just maybe another piece of relevant information is that a year and a.

Half or so ago the risk weights were 200%. They were, they were reduced down to the current level which is around 100% based on PTI. But now the, the. The central bank with its revised agenda in terms of driving SME and reducing.

Consumer lending or slowing the pace of.

Consumer lending growth across the system has now put them basically back up to where they were. But if we have a very high share that is 75% or more than it’s up to 250%.

So that’s the lie of the land. Could these be amended further?

I think it’s unlikely because these are being communicated. But you can see that the central bank in Uzbekistan is, has a very firm stance on where it wants to see consumer lending or what it wants to see happening with SME lending. So I can’t rule it out completely but I think it’s unlikely.

Andrew Keeley, Director of Investor Relations, TBC: Thanks, Oliver. Piers, do you want to ask on Georgia?

Piers Brown, Analyst, Investec: Yeah, no, thanks for that Oliver. That’s very helpful. Yeah, so in Georgia I guess this is Yorhi, I think you mentioned a.

Vakhtang, CEO, TBC: NIM.

Piers Brown, Analyst, Investec: Sort of guidance level or realistic level of somewhere in the 5 highs or maybe 6%. I’ll just be interested in the components of that because I guess if I look at the Georgia business here, the portfolio growth is coming mostly now in the order you’ve got very strong version in the fast consumer level. And so I guess structurally that’s shifting the margin higher. But it would be just if you could give some, some insights onto the components of NIM over the next year or so that would be very helpful.

Giorgi Meghrelishvili, CFO, TBC: Yes, thanks for a good question. So there are different dynamics from currency structure from Larry and fx. If you consider Larry over time with astral quantity within cycle we do expect the refra to come down maybe if it’s a, it’s a post a bit so that probably will put additional pressure. However, it’s more than compensated as you rightly mentioned, like Aussie change of our portfolio structures, that’s number one. Also change of our FX composition now our laryzation is going up. We have a More focus on lottery loans that also have higher yields on a FX side we do also see the benchmark rates coming down. That’s maybe marginally negative. However, we also like on the fix we have our wholesale funding more on a floating basis. Therefore we are more hedged on that side.

So overall that’s what I why I’m saying that taking into consideration all these components growth and our plus we do expect to remain high like as I say high fives like around 6% level.

Piers Brown, Analyst, Investec: Perfect. That’s very helpful. Thanks for the answers.

Andrew Keeley, Director of Investor Relations, TBC: Thank you Piers. Okay, next up we have Stuart from Peel Hunt. Stuart, please go ahead.

Thankfully hopefully you can hear me. I’ve got two questions as well actually almost similar to Piers. The first one on Georgia. Georgi, you sort of mentioned about some of the pressures in fee and commission income. I’d just be interested to know whether these trends continue and persist or whether at some point you start to see some sort of reversal and you start to see growth in that line again. And then the second question is on Uzbekistan and for all of our you’ve also spent quite a bit of time talking about some of the regulatory interventions, a fairly detailed regulatory agenda. I’d just be interested if there’s any sort of other potential implications you see over the next 12 months or so a regulator which feels like it’s doing quite a lot of detailed work around the sector. Thank you.

Giorgi Meghrelishvili, CFO, TBC: Thanks. Probably Fiat Commission income is the outcome of our strategy and I head back to Wachtank to kind of elaborate more wider but generally what I can say our focus on top line growth given structure and we do expect our top line like both NII and Netflix Commission income combined to grow at healthy levels maybe mid teens. But there will be a composition change for which I’ll pass to waking up. So let’s elaborate more.

Vakhtang, CEO, TBC: Yeah as you understand main drivers of our Fiat Commission income in Georgia is the debit cards and after that coming as a type of the income. So on that side you know that at the end of the last year we began to issue new type of the card TBC card and we are doing very well. So till today we already issued more than 800,000 TBC cards and this is a very good tool for us to attract and to bring new customers on the one hand new customers to TBC or passive customers who did not use historically our debit cards.

So on that side we are looking.

That it’s a good tool for us to bring them and this TBC card is mainly free of charge and on some of the operations.

But indirectly it’s very valuable for us.

Because a lot of consumer loans or the credit cards, by the way, we are doing very well for the mortgages as a type of the loans. It’s a very tool just to bring adapters to offer different kind of the products.

And to summarize my answer, so we will continue to issue more and more.

TBC cards, which is very important to bring new customers and we want to build on that to sell more different kind of the products, especially where we have a high profitability such as credit cards or consumer loans to these new customers.

And to summarize, so probably we could not see growth in fiat commission income during 2026. But indirectly it will influence our high.

Growth in most profitable segments such as credit cards, consumer loans.

And indirectly it means that will increase.

Materially our net in net interest income in 2026.

Thank you.

Oliver Hughes, Head of International, TBC: And taking your question on Uzbekistan, could there be more regulatory changes?

Stuart? So the answer is obviously yes. So I would preface my answer by saying that the regulatory framework in Uzbekistan is pretty well formed as we’ve been saying a lot over the years. So on the consumer lending side, they.

Have risk weights, PTI regulation, rate caps, ban on FX lending to consumer. So I think it’s unlikely that major new changes to the regulatory framework are going to be introduced. But it’s clear that the regulator has.

Particular objectives that it’s following, that it’s.

Trying to achieve in the near to medium term. So it’s is trying to change the.

Shape of the national loan book and push SME lending, get banks to focus their efforts on pushing SME lending as opposed to unsecured consumer lending. And part of this is inflation targets. Part of it is making sure that the national loan book is balanced in the way that the central bank wants to see.

So if they see that consumer lending growth and SME lending growth are not.

In the proportions that they want, then.

It’S possible they will do more.

But right now we can’t tell you what else they might do given that there’s already quite a lot being done.

So we’ll keep you informed obviously.

Thank you very much.

Andrew Keeley, Director of Investor Relations, TBC: Thanks Stuart. So we, we have a next up from Simon at, at Citi. Simon, please go ahead.

Oh, hi, thanks. Maybe just one more for Oliver. I mean the, the risk cost has remained elevated. How much of this is kind of testing your kind of micro loan client segments and how much of it is testing the SME? And I guess going forward, if you have to accelerate faster in SME, is it Fair to assume that continued testing is going to lead to continued high risk cost for quite some time.

Oliver Hughes, Head of International, TBC: So our loan book is predominantly unsecured consumer loans. It’s mainly what they call micro loans, which is unsecured personal loans. And there that’s as a result of the tests predominantly, as we said earlier, obviously there’s the fraud hit that we took in quarter one, but it’s mainly tests which matured a little bit of operational stuff in quarter two and quarter three. Our SME loan book is growing from zero fairly quickly and there is definitely elevated cost of risk. But that’s not what you see coming through the numbers there because it has very little effect because it’s a small share of the loan book.

As we change the proportions going forward.

Obviously we have to do a lot more testing to understand what lies where in micro business, small business and.

Let’S.

Say the larger end of SMEs who will be tackling predominantly through bills.

We will obviously try and manage risk.

In a way that doesn’t affect the numbers. We think that we’ll remain in the corridor that we communicated earlier, 7 to 10%.

Certainly the consumer lending book has topped.

Out and we think that will start coming down as we go into the beginning of next year. But in SME, depending on the pace of growth, obviously you’ll see some risk coming through that. So I can’t guide you in any numerical way at the moment, but we.

Will have to keep on top of that.

Super, thank you. Thank you. That’s my only question.

Andrew Keeley, Director of Investor Relations, TBC: Thank you. Simon. There’s a couple of questions that come through on the chat. One is about coming back to Uzbekistan. I think we’ve, you’ve more or less answered on the kind of cost of risk, about the kind of normalized cost of risk, but also should we expect revisions to longer term targets after the challenges that the bank has faced in Uzbekistan? And then the question on Georgia was just why was Q on Q growth, loan growth in Georgia so muted? We’ve kind of covered that already, but you may want to add some more.

Vakhtang, CEO, TBC: Yeah, maybe I’ll answer the third question about the growth. So in Georgian operation, in a CIB business, incorporated business, we have two big one offs and that influence our growth. Otherwise if we extract these two one offs from the corporate business, we are following the growth of the total banking sector and especially for us, very important that we are winning market share in the consumer loans and credit cards.

Oliver Hughes, Head of International, TBC: And on the Uzbekistan question about longer term outlook. So we reiterate our confidence in the, in the potential in Uzbekistan and our ability to capture that potential medium to long term. But as you can see rather than right now, we’ve got a lot of moving parts and so it’s very difficult to give any meaningful guidance until things settle down into some kind of more predictable pattern which we hope will happen in the next few months. So by the time we get to February next year and the strategy Day, we hope the dust will have settled and we’ll be able to give some more meaningful longer term projections. But right now it’s moving around.

Andrew Keeley, Director of Investor Relations, TBC: Thank you. And Oliver, maybe just another one for you about the micro loans and whether we can classify micro loans that are maybe to very small businesses, you know, as SME kind of loans, you know, to help kind of grow the share of the SME loan book that way.

Oliver Hughes, Head of International, TBC: Sure.

And it’s a great question. Absolutely the right question.

So we have so far to lines.

Let’S call them business lines in SME.

So there’s if you like, true origination.

Of SMEs who are new to bank and that’s the business we’re learning at the moment. It’s working capital loans. We want to try and test secured loans to SMEs and we’ll start doing other stuff as well as we go through the year next year.

And then there’s what you can maybe term as kind of business consumer or consumer business loans, which is your question, where generally in an unsecured mass market.

Consumer loan book, you’ll have 25 to 30% of those customers wearing a consumer hat, but actually borrowing for business purposes.

And that will be a big driver.

Of our SME lending growth next year. So basically, and we’re hiving off some of the cash loan or the ICL business and reclassifying as SME. Because these are either individual entrepreneurs or self employed customers who indicate that the loan they’re taking is for business purposes, which means that they will be classified as SME from central bank reporting purposes.

Andrew Keeley, Director of Investor Relations, TBC: Thanks, Oliver. Simon has his hand raised. I don’t know if that was. Simon, do you have another question?

Yes, yes, I do actually. Just I was hoping you could elaborate a bit on the insurance business in Uzbekistan. You’ve, you’ve booked some revenue there this, this quarter. Is that expected to, to, to grow nicely going forward? I assume it is. And then maybe just on the, the Georgian business, the, I think the FX revenues went up quite nicely in the quarter. If you could comment on that and, and how sustainable that is.

Oliver Hughes, Head of International, TBC: Would you like to take George first?

Giorgi Meghrelishvili, CFO, TBC: Yeah. Okay. Hi, I was waiting for you, but I can take so on business. As I mentioned, like general emergency went down significantly. The LARI has been very stable. It’s just seasonality. So if you look how the flows are. So it has been higher flow flows during Q3, also a bit higher margins. Generally what we can say is that nine months is a like truly conservative run rate for us on FX because with the subdued margins we still delivered that level that as I mentioned during my call was flat compared to nine months last year.

Vakhtang, CEO, TBC: But in addition to that, what is Georg saying? We have very comfortable level of growth of the transactions in fx but as Georgi said, the margins went down dramatically compared to 2024. And as you know we have very stable exchange rate during this year. So that influenced the fx. Otherwise the transactions in the number and the volumes of transactions were doing very well.

Oliver Hughes, Head of International, TBC: I’m very briefly on insurance.

TBC surgurta, which is the ultimate word for insurance. It’s new, so we launched it basically in March, April this year. It’s captive insurance. So basically these are products which we’re selling to our existing customer base, Credit linked, but we have ideas obviously to add new insurance products and sell them to our existing customer base which is obviously very large in Uzbekistan and growing. And then at some point we will get round to selling insurance products into the market which are not captive insurance products. But at the moment that’s where we’re starting.

So that’s credit protection primarily. Yeah. Great. Now who’s your partner there?

So it’s, it’s our in.

In group house.

Okay, super, thank you.

Andrew Keeley, Director of Investor Relations, TBC: Thanks very much. Simon, Sam, are there, are there any calls on the, the phone lines?

Sam, Call Moderator: There are not, no.

Andrew Keeley, Director of Investor Relations, TBC: No. Okay. We don’t have any other questions at this time. Yep, nothing coming through. So I just say thank you all very much for joining this call. As always, we’re around and available to answer any follow up questions that you have and I’m sure we’ll be, you know, meeting and catching up over the coming months and we’ll be publishing our full year numbers in February next year. So. So thank you very much and goodbye.

Giorgi Meghrelishvili, CFO, TBC: Thank you very much.

Thank you.

Sam, Call Moderator: This concludes today’s webinar. Thank you all for joining. You will now be disconnected. Have a great day.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.