TBC Bank Earnings Call Highlights Profitable Growth

TBC Bank ((GB:TBCG)) has held its Q4 earnings call. Read on for the main highlights of the call.

TBC Bank’s latest earnings call struck an upbeat tone, with management highlighting record quarterly results, double‑digit profit growth and robust returns on equity, all underpinned by digital expansion and growing scale in Uzbekistan. While regulatory turbulence and softer performance in Uzbekistan, plus weaker Georgian deposits, weighed on parts of the story, management argued that profitability and capital strength more than offset these issues.

Record Profitability and Returns

TBC Bank reported a record Q4 net profit of about GEL 390m, up roughly 16% year‑on‑year and delivering a strong quarterly ROE of 24.9%. For the full year, net profit exceeded GEL 1.4bn, rising 9% versus the prior year and keeping full‑year ROE at a high 24.2%, reinforcing the bank’s status as one of the most profitable names in its region.

Revenue Momentum and Net Interest Tailwinds

The group’s top line grew around 15% in Q4 and approximately 20% for the full year, supported by solid business volumes and pricing. Net interest income was a standout, jumping 23% in Q4 and acting as the main engine of revenue expansion, helping the bank absorb regulatory and macro noise in some markets.

Resilient Georgian Core Franchise

The Georgian business remained the earnings backbone, with Q4 net profit up 15% year‑on‑year and ROE at an impressive 25.7%. Loan growth was healthy at 11% year‑on‑year, led by a 36% surge in cash loans, while digital engagement deepened as the bank added 250k digital retail customers and maintained a high 47% DAU/MAU ratio.

Uzbekistan: High Growth, Emerging Scale

Uzbekistan continued to scale rapidly, with loans up 45% year‑on‑year and operating income growing about 67%, supported by strong demand and product penetration. Payments activity surged more than 60% to $9.2bn, user metrics climbed to roughly 6m monthly actives and 23m registered users, and the market contributed around 20% of group operating income and 9% of net profit.

Digital Ecosystem and Product Adoption

Across the group, digital monthly active users almost doubled over three years to 7.3m as the bank deepened its mobile and online presence. The flagship TBC card approached the 1m mark, while new tools such as an in‑app chatbot, a fast‑growing retail brokerage base and a 50% expansion in the affluent Concept offering showcased the cross‑sell potential of TBC’s platform.

Margins, Efficiency and Capital Returns

Group net interest margin reached about 7% in Q4, with Georgia at roughly 6%, and full‑year NIM improved by around 30 basis points as the balance sheet was optimized. Operating expense growth remained controlled, pulling the cost‑to‑income ratio down to 37.5%, while lower cost of risk at 1.1% and robust capital allowed higher dividends and a completed GEL 75m share buyback.

Loan Growth, Funding and Capital Strength

On a constant‑currency basis, group loans rose about 12% and customer funding grew 13% over the year, reflecting broad‑based franchise expansion. Q4 loan growth was particularly solid at 5%, driven mainly by a 6% increase in Georgia, and management emphasized that capital ratios remain comfortably above regulatory floors, supporting future growth and shareholder payouts.

Uzbekistan: Regulatory Drag on Q4

The final quarter in Uzbekistan was notably softer as new rules on portfolio caps and risk weights prompted a shift in lending strategy and a modest contraction in the bank‑balance‑sheet loan book. These regulatory adjustments weighed on Q4 operating income and profit from the market, forcing the bank to recalibrate its product mix and risk deployment.

High and Volatile Risk Costs in Uzbekistan

Management acknowledged that Uzbekistan’s cost of risk is structurally elevated and reiterated a 7%–10% range for the coming year as the portfolio matures. Non‑performing loans have ticked up and seasonal volatility remains a feature, especially in early quarters, as the bank continues to rebalance its mix away from the riskiest micro and instalment credit lines.

Shortfall Versus Internal Profit Aims

Despite delivering another year of strong earnings growth, management conceded that full‑year net profit fell short of its internal 2025 target, primarily due to the Uzbekistan headwinds. Even so, they stressed that on a multi‑year view the bank has compounded earnings by more than 40%, suggesting the setback is temporary rather than structural.

Pressure on Georgian Deposits

One softer spot was funding in the home market, where Georgian customer deposits declined by around 12% year‑on‑year, raising questions about future funding costs and competitive dynamics. Management emphasized that liquidity and capital remain healthy, but investors will likely watch deposit trends closely as the bank sustains loan growth and generous capital returns.

Regulatory Complexity in Uzbekistan

The operating backdrop in Uzbekistan has become more complex, with a stream of new rules covering portfolio limits, risk weights, consumer affordability metrics, payment systems and cyber safeguards. While these changes support system stability, they add timing risk and near‑term volatility as TBC adjusts its products, processes and balance‑sheet allocation to the new regime.

Outlook and Management Guidance

Looking ahead, management aims to keep group ROE above its 23% target with broadly stable NIMs, supported by a benign rate backdrop and about 5% GDP growth in Georgia. In Uzbekistan, they expect NIMs to recover towards 20%, loan growth to re‑accelerate later in the year to above 20% and the share of higher‑risk micro and instalment loans on the balance sheet to steadily fall, while preserving ROE at or above current levels and maintaining strong capital and disciplined costs.

TBC Bank’s earnings call painted a picture of a high‑growth, high‑return franchise balancing strong digital‑led expansion with the challenges of a tightening regulatory environment, particularly in Uzbekistan. For investors, the story remains one of robust profitability, rising dividends and meaningful regional diversification, tempered by funding dynamics in Georgia and execution risk as the group adjusts to new rules in its fastest‑growing market.