International rating agency S&P Global Ratings has released an updated assessment of banking sector risks, analyzing key trends, strengths, challenges, and macroeconomic risks across the Central Asia and Caucasus region. 

According to the report, Georgia ranks in the 7th group of countries in terms of economic and banking sector risks-the highest rating in the region, shared with Kazakhstan. 

The influential rating agency highlights that Georgia leads the region in banking sector regulation and supervision. The report also notes that Georgian banks maintain the highest asset quality in the region, with a minimal cost of credit risk, as reflected in the low share of IFRS Stage 3 loans in their portfolios. 

Additionally, the net interest margin of Georgian banks is the lowest in the region. 

As a regional innovator, Georgia is expected to continue aligning its bank resolution framework with European standards, following the EU’s Bank Recovery and Resolution Directive (BRRD), according to S&P’s assessment.