TBC Bank Group PLC

Hello and welcome everyone to the TBC 4Q and FY 2025 IFRS results conference call. My name is Becky and I will be your operator today. All lines will be muted throughout the presentation portion of the call with a chance for Q&A at the end. If you wish to ask a question during the webinar, please use the raise hand button if you've joined the call via Zoom. If you've joined us on the phone lines, please press star followed by one on your telephone keypad. You can also submit any text questions via the Zoom chat box on your webinar. I will now hand over to your host, Andrew Keeley, Director of Investor Relations, to begin. Please go ahead.

Thanks very much, Becky, and welcome, everybody, to TBC Group's 4Q and Full Year 2025 results call. It's great to have you with us today. As usual, I'm joined on the call today by our Group CEO, Vaktan Butskirakidze. our Group CFO, Gyorgy Megrelisvili, and we'll also be joined for Q&A by Oliver Hughes, our Head of International Business. We'll also start with a presentation from Vaktan and Gyorgy, and then go to Q&A. And with that, I'll hand over to Vaktan. Thank you.

Thank you, Andrew. Hello, everyone, and thank you for joining us today. I am pleased to present our results for the first quarter and the full year of 2025. Overall, we had a very good final quarter, bringing 2025 to a successful conclusion. For the full year, the group delivered over 1.4 billion lari net profit, up by 9% year-on-year, with 24.2% return of equity. As for the final quarter, it was a record quarter in which we also printed our highest return of equity of the year, with almost 390 million lari net profit, and 24.9% return of equity. It was an excellent final quarter for our core Georgian franchise, with net profit up by 15% year-on-year and 25.7% return of equity, driven by a strong combination of robust loan growth and net interest margin, and low cost of risk and strong cost controls. The quarter was was more mixed in Uzbekistan, and the changes in regulations that I have previously discussed meant the slight contraction in lending, impacting revenues and earnings. That said, taking the year as a whole, the team made a huge progress in scaling up the business, including 45% loan growth year-over-year, 67% revenue growth, and almost 1 million daily banking salon cart issued, and digital mall topping 6 million. As a result of our strong operating performance and the solid capital position, the board has declared the final dividend of 3.87 Lari per share, bringing the total 2025 dividend to 8.87 Lari, which is the 10% increase year-on-year. I won't dwell too long on this slide, but the main point I want to get across is that 2025 is another example of the TBC's long-term track record of delivering a nice combination of growth, profitability and returns. Moving to our 2025 targets. Overall delivery against most of these targets has been good. Our digital monthly active user numbers have almost doubled over the past three years to 7.3 million. We have also consistently maintained return of equity above our 23% target level. Similarly, we have been paying out at the top of our guided range. As we discussed at the third quarter results, unfortunately, net profit in 2025 came in lower than targeted due to some challenges in Uzbekistan. That said, taking the past three years as a whole, we have still grown our group's earnings by over 40%. We also delivered 90% loan CAGR in Uzbekistan above our target and comfortably surpassed our 5 million monthly active users target. Turning now to Georgia. As you can see, the Georgian economy remains strong with the real GDP growth standing at 7.5% in 2025. We see growth starting to normalize, but our economy sent IFIs like Monetary Fund and the World Bank still expect around 5% growth in 2026, which is not a bad figure at all. The inflation rate is slightly above the MPG 3% target, driven by the combination of a low base of effect from 2024 and elevated domestic and global pressures on food prices. That said, we expect the MPG to resume cutting rate this year as inflation trends back down. 2025 was a strong year for our business in Georgia. We had a number of good operational achievements through the year. This included our flagship daily banking TBC card hitting almost 1 million cards in issuance, a doubling of our retail brokerage customer base, to over 100,000 and 50% growth in our market leading product TBC concept. We also saw a number of tangible development driven by AI with our mobile application chatbot launched in September and already handling over 100,000 iterations a month with a 50% offloading rate. I like the next slide as it shows the high, highly consistently performance of our Georgian financial services business over the past three years, as we continually delivering mid 20% return of equity. We continue to be a leading player across most of the key banking segments in Georgia. In 2025, our gross loans were up by 11% year-on-year. I'd like to highlight particularly strong performance in cash loans, a key focus area for us, where our loan book portfolio grew by 36%. Meanwhile, our Georgian customer deposit increased by 12% over the same period. Digital engagement among our retail customers in Georgia continues to grow. Having brought our core banking technology platform in-house, 2025 was a year when we started to clearly see the benefits of having full control over all aspects of our digital banking. With faster deployments and the revamped customer experience, we have been strongly increasing our digital customer base. We added over 250,000 customers during the year, growing of 24% year over year. Engagement levels also remain very high with a 47% DAO to MAO ratio. And we continue to see very high levels of digital unsecured loans and deposit issuance. Now let's turn to our Uzbek businesses. Starting with the economy, the Uzbek economy remains highly dynamic with real GDP growth of 7.7% in 2025. Inflation continued to decline to 7.3% in December. Importantly, seasonally adjusted annualized monthly inflation is now below the CBUS 5% target, which we think will help enable interest rate cuts this year. Next slide highlights some of the key milestones in our Uzbek business in 2025. We scaled up our business in a number of areas during this year. In business lending, we have issued over 130,000 loans, while our built acquisition gives us access to more than 3,000 retail merchants, processing over $1.4 billion of transactions. At the same time, payment volumes have increased over 60% year-on-year to 9.2 billion. We have also had a great take-up of our daily banking products, such as Salome and Osmo cards. We also now have an excellent 600,000 PayMePlus subscribers as we deepen engagement with our ecosystem customers. On the next slide, we have an overview of Uzbekistan's stock progress over the past three years. During this time, we have more than doubled our registered users to 23 million, and we have hit 6 million monthly active users. As I mentioned earlier, our logbook has grown at 90% three-year CAGR, while our retail deposits have increased at 65% three-year CAGR to around $550 million. As mentioned previously, we saw a softening of operating income and the net profit in the final quarter. But for 2025 as a whole, operating income grew at excellent 67%, while we returned our 18% return of equity. Next slide shows Uzbekistan increasing market share and domaterial contribution to the group. By the end of 2025, our market share of our retail loans and deposits stood at 4.2% and 3.8% respectively. STBC established itself as a top 10 bank in both retail loans and deposits. In 2025, Uzbekistan contributed 9% of the group's net profit and 20% of the total operating income. Before handing over to Georgi, I'd like to mention a couple of other important pieces of recent news. As you may have seen, we recently announced some changes to our management team. I have decided to commit my time fully to my role as a group CEO, which will enable me to focus more closely on overall group strategy, including our business in Georgia and Uzbekistan, as well as exploring international opportunities. As a result, Goga Tchelidze will take over from me as the CEO of TBC Group Georgian subsidiary, joint stock company TBC Bank, effective from the 1st of March, subject to the regulatory approval. Goga has been deputy CEO for 12 years, the last 10 years of which he has been running CIB and wealth management. During this time, he has built these businesses into a dominant franchise they are today. I am very confident that Goga will be a great leader for our Georgian business. The other news, as you probably already know, is that we will be holding our Strategy Day next week in New York on Tuesday, 24th of February. I very much look forward to welcoming you to this event. And for those who are unable to join in person, there will be a live webcast as well. With that, I hand over to Georgi.