The head of the Georgian Bankers Association agrees with the government’s decision to convert loans from USD to GEL. to convert
The Executive Director of the Georgian Bankers Association considers an agreement between the government and the National Bank of Georgia (NBG) to be appropriate and relevant to allow people to convert loans from US dollars to local currency.
The key figure of the banking association Giorgi Tsutskiridze issued a statement following yesterday’s announcement by Prime Minister Giorgi Kvirikashvili that Georgian citizens who took out their loan in US dollars before January 1, 2015 will convert their loan into Georgian lari (GEL) can.
If the exchange rate between the lari and the US dollar is 2.50, the loan will be converted at a rate of 2.30, ”said Kvirikashvili, adding that the difference of 20 tetri would be covered by the state budget.
Tsutskiridze said this solution would reduce the financial obligations of many Georgian citizens who are currently in a difficult position as the lari continues to depreciate against the US dollar. Currently a USD 2.53 GEL was worth.
The move will also help the state economy, as many Georgians were involved in the credit problem, ”said Tsutskiridze.
The banking association brings together 21 commercial banks and one microfinance organization in Georgia.
Tsutskiridze also responded to the government’s intention to support the national currency, which meant that from next year Georgian banks would only be lending up to GEL 100,000 in GEL and that companies operating in Georgia would price their products in GEL first Must announce before they secondary rates in other currencies.
He stressed that Georgia should increase the production of locally made products and be less dependent on imports because of its lower dependency on foreign currencies.