In its 2026 report on Georgia, the European Commission positively assesses the reforms undertaken by the National Bank of Georgia (NBG) in recent years, as well as the country's macroeconomic stability, underpinned by strong fiscal performance and sound monetary policy.

The report commends Georgia's macroeconomic policy, including the monetary policy implemented by the NBG. It notes that monetary policy has been appropriate and that the recent acceleration in inflation has been driven primarily by the sharp rise in global energy prices and other supply-side shocks.

The report highlights the increase in international reserves and the significant steps taken towards strengthening financial sector regulation and supervision. According to the assessment, the NBG continues to enhance the resilience and transparency of the financial sector and strengthen effective supervision, while promoting alignment with EU best practices and regulatory standards.

According to the report, Georgia's external position has strengthened, with the current account deficit narrowing and international reserves increasing. In July 2026, the country's gross international reserves reached a historic high of USD 8.1 billion, equivalent to 128% of the level deemed adequate under the International Monetary Fund's Assessing Reserve Adequacy (ARA) metric.

The report notes that the country's sound macroeconomic fundamentals, together with its fiscal and external buffers, put Georgia in a favorable position to withstand global shocks.

According to the assessment, the asset quality of Georgia's banking sector remains strong. In April 2026, the ratio of non-performing loans to total loans stood at 2.6%, while the banking system's capital adequacy ratio was 22.2%. During the same period, the banking sector's return on equity (ROE) stood at 21.9%. The 3-percentage-point decline in deposit dollarization to 48.6% is also highlighted as a positive trend.

The European Commission's report places particular emphasis on progress in the regulatory and supervisory framework for the financial sector. In this regard, it positively assesses the amendments to the Organic Law of Georgia on the National Bank of Georgia, which grant the NBG the authority to exercise full prudential supervision over virtual asset service providers. The report emphasizes that the adoption of new regulations for stablecoins and virtual asset service providers was aimed at aligning the country's regulatory framework with the standards of the EU's Markets in Crypto-Assets Regulation (MiCA).

Furthermore, the National Bank of Georgia has further enhanced the integration of its reporting systems with Europol's Central Office for combating euro counterfeiting and introduced new regulations for stablecoins and virtual asset service providers to align with the relevant requirements set out in Regulation (EU) 2023/1114 on markets in crypto-assets.

A separate section of the report is dedicated to measures taken to strengthen the resilience of the banking sector. Specifically, it highlights the increase in the minimum requirement for own funds and eligible liabilities (MREL) for systemic commercial banks from 10% to 15%, as well as the commencement of commercial banks' contributions to the resolution fund. These mechanisms serve to strengthen the resilience of the financial sector and its crisis management framework.

Additionally, in March 2026, amendments were introduced to the Rule on Developing and Assessing a Commercial Bank's Recovery Plan, under which the NBG assesses the compliance of recovery plans within six months.

The European Commission also positively assesses the steps taken by the NBG towards developing sustainable finance. Specifically, a green loan data dashboard was launched in January 2026, followed by an updated form for environmental, social and governance (ESG) reporting and disclosure in February 2026. According to the report, these initiatives contribute to promoting sustainable finance and improving transparency within the financial sector.

The European Commission also positively assesses the measures taken to improve the regulatory framework for payment services and strengthen the NBG's supervision of the financial sector. These include legislative amendments concerning payment initiation services and alternative dispute resolution, as well as the adoption of guidelines for the off-site supervision of commercial banks and microbanks. In the same positive context, the report also highlights changes to the allocation of responsibilities among members of the NBG's Board, in line with the International Monetary Fund's recommendations concerning central bank independence.

In the area of payment services, the NBG was also granted the authority to hold accounts for non-bank payment service providers that participate in important payment systems.

In addition, in November 2025, amendments were made to the Law on Facilitating the Prevention of Money Laundering and the Financing of Terrorism in order to address MONEYVAL recommendations.

According to the report, Georgia's corporate bond market expanded during the reporting period, with 13 public corporate bonds issued by seven local issuers, bringing the outstanding volume of bonds to approximately 2.5% of GDP. The report also highlights the Law on Factoring, adopted in March 2026, which provides small and medium-sized enterprises with an additional instrument for accessing finance and is expected to support the development of a new segment of factoring companies in the financial market.

According to the European Commission's assessment, despite its recent growth, the non-banking financial sector remains small. Accordingly, further development of the capital market and the insurance sector is identified among the country's future priorities. These efforts will contribute to diversifying the financial system and strengthening alternative sources of financing.