The National Bank of Georgia continues sharing its experience on prudential supervision

Within the frames of its regional capacity development program, the International Monetary Fund Technical Assistance Center for East Africa (IMF East AFRITAC) arranged a professional visit for the representatives of the Bank of Uganda to the National Bank of Georgia (the NBG). During the visit, the NBG shared its analytical framework and experience on macroprudential supervision with Ugandan colleagues.

Robert Mbabazize, Deputy Head of Financial Stability Department of the Bank of Uganda stated: "During our visit to the NBG, our delegation greatly benefited from the specialist knowledge and notable progress that the NBG has made in the direction of macroprudential supervision. The visit to the NBG was rewarding and well-organized. We would like to express our gratitude to Koba Gvenetadze, Governor of the NBG, and Otar Nadaraia, Deputy Governor, as well as the NBG staff, who took their time to share their knowledge and experience with us."

Dirk Jan Grolleman, Bank Supervision Advisor at IMF East AFRITAC stated: "I would like to thank the National Bank of Georgia for this very valuable event. The NBG has made significant progress, which is also highly relevant for Uganda and the East African region in general, most notably: loan-to-value monitoring, developing a framework for the counter cyclical capital buffer, risk weighting of foreign exchange denominated loans, and financial ratio analysis for the assessment of the (system wide) development of credit risk, stress-testing framework etc. What really stands out is integration of micro and macro prudential supervision."

Otar Nadaraia, Deputy Governor of the National Bank of Georgia stated: "We were delighted to welcome the Bank of Uganda representatives at the NBG and share our experience with regard to macroprudential supervision. Indeed, integration of micro and macro prudential analysis is very important for traditional microprudential supervision, as well as for maintaining financial stability. As rightly mentioned in one of the most recent FED notes , "macroprudential policy discussions may be increasingly informed by macroeconomic models in coming years, but microeconomic analyses of the distortions in individual markets and the policy actions that can mitigate such distortions will likely remain central." This is even more relevant for the developing countries. At the same time, the use of micro-based analysis in system-wide risk assessment remains a challenge in many jurisdictions."