BAKU, Azerbaijan, Feb. 10
By Tamilla Mammadova – Trend:
Georgian Finca Bank and Crystal microfinance organization (MFO) confirm the merger, Trend reports citing Georgian media.
Reportedly, negotiations on this issue have not yet been completed, but representatives of Finca Bank have confirmed that negotiations are indeed ongoing.
The Crystal microfinance organization said that preliminary agreement on fundamental issues has already been reached; now the parties are to complete consultations on the financial transaction and obtain consent from the National Bank.
At this stage, both financial institutions continue to operate normally.
After the regulator’s permission is obtained, the merger process will end and a new bank will appear in the country.
This is not the first case of a merger of financial institutions in Georgia, and probably not the last - negotiations are underway to merge Georgian Cartu Bank and Liberty Bank.
According to the head of the Association of Banks of Georgia Alexander Dzneladze, the process of combining financial institutions is welcome, as the appearance of new, larger players on the market will contribute to increased competition. In his opinion, the regulator should contribute in every way to this, and most likely, the trend towards consolidation of banks and MFOs will continue in the future.
“When a business sector reaches a certain size, then the enlargement process begins. In the process of unification, the number of financial companies will certainly decrease, but those that remain will be larger and stronger. Accordingly, there is no threat that two-three giant banks will remain in the market, which will completely dominate,” Dzneladze said.
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