3rd Quarter Results

Bank of Georgia

1.81 GEL/US$ 30 September 2010

1.79 GEL/US$ 9 months 2010 average

1.84 GEL/US$ Q3 2010 average

1.84 GEL/US$ 30 June 2010

1.80 GEL/US$ Q2 2010 average

1.68 GEL/US$ 30 September 2009

1.67 GEL/US$ 9 months 2009 average

1.67 GEL/US$ Q3 2009 average

JSC BANK OF GEORGIA REPORTS Q3 2010 AND YTD 2010 RESULTS

Millions, unless otherwise noted	Â	Q3 2010			Â	Growth q-o-q¹
Bank of Georgia (Consolidated, Unaudited, IFRS-based)		US$	Â	GEL
Total Operating Income (Revenue)²		50.5		91.2		10.5%
Recurring Operating Costs		28.2		51.0		6.7%
Normalised Net Operating Income³		22.2		40.1		15.6%
Net Non-Recurring Income / (Costs)		(0.9)		(1.6)		NMF
Profit/(Loss) before provisions		21.3		38.5		6.2%
Net Provision Expenses		7.9		14.2		12.8%
Net Income/(Loss)		11.5		20.8		6.3%
							Â
		9 months 2010				Growth y-o-y¹
		US$		GEL
Total Operating Income (Revenue)²		138.2		249.6		3.3%
Recurring Operating Costs		80.3		145.1		6.7%
Normalised Net Operating Income³		57.9		104.5		-1.1%
Net Non-Recurring Income / (Costs)		(1.9)		(3.4)		NMF
Profit/(Loss) before provisions		56.0		101.1		-2.1%
Net Provision Expenses		18.9		34.2		-66.8%
Net Income/(Loss)		31.7		57.2		NMF
							Â
Total Assets		2,001.5		3,615.6		21.3%
Net Loans		1,141.1		2,061.4		24.2%
Client Deposits		918.1		1,658.5		40.3%
Tier I Capital Adequacy Ratio (BIS)⁴				19.9%
Total Capital Adequacy Ratio (BIS)⁵				32.6%
Tier I Capital Adequacy Ratio (NBG)				15.2%
Total Capital Adequacy Ratio (NBG)				15.7%

¹ Compared to Q2 2010; growth calculations based on GEL values.

²Compared to the respective period in 2009

³ Revenue includes Net Interest Income and Net Non-Interest Income.

⁴ Normalised for Net Non-Recurring Costs.

⁵ BIS Tier I Capital Adequacy Ratio equals Tier I Capital as of the period end divided by Total Risk Weighted Assets as of the same date, both calculated in accordance with the requirements of Basel Accord I.

⁶ BIS Total Capital Adequacy Ratio equals Total Capital as of the period end divided by Total Risk Weighted Assets as of the same date, both calculated in accordance with the requirements of Basel Accord I

Bank of Georgia (LSE: BGEO, GSE: GEB) (the â€œBankâ€), Georgiaâ€™s leading bank, announced today its Q3 2010 and year-to-date (YTD) 2010 consolidated results (IFRS based, derived from management accounts), reporting a Q3 2010 Net Income of GEL 20.8 million and YTD 2010 Net Income of GEL 57.2 million.

Q3 2010 highlights

For the first time in the past three years, the Bank posted double digit quarter-on-quarter growth of the Consolidated Net Normalized Operating Income (NNOI) which grew 15.6% q-o-q to GEL 40.1 million, up 16.9% y-o-y, while Consolidated Profit Before Provisions increased 6.2% q-o-q to GEL 38.5 million, up 18.7% y-o-y
Consolidated Net Cash Flow from operating activities increased 67.4% y-o-y to GEL 138.7 million in nine months in 2010
Consolidated Loan book quality improved as consolidated NPLs declined from GEL 173.7 million in Q2 2010 to GEL 131.5 million in Q3 2010. Consolidated NPL coverage ratio stood at 141.4% in Q3 2010 compared to 113.5% in Q2 2010
Cost of Funds continued to decline reaching 7.9% in Q3 2010, down from 8.4% in Q2 2010 and down from 8.6% in Q1 2010
Consolidated Client Deposits grew 11.5% q-o-q to GEL 1,658.5 million, up 30.3% YTD and up 40.3% y-o-y, driven by:
- Retail Banking (RB) Client Deposits 10.2% q-o-q increase to GEL 494.2 million, up 31.4% YTD and up 51.5% y-o-y;
- Corporate Banking (CB) Client Deposits 17.1% q-o-q increase to GEL 799.4 million, up 36.1% YTD and up 34.0% y-o-y;
- Wealth Management (WM) Client Deposits 3.6% q-o-q increase to GEL 218.7 million, up 34.1% YTD and up 62.7% y-o-y.
Extended approximately GEL 485.9 million,on a standalone basis, (up 103.3% y-o-y and down 3.0% q-o-q), in new loans to an estimated 24,000 clients (through credit cards, mortgages, consumer and other loans) and to small-and-medium sized companies and corporate clients
Net Loan to Client Deposit Ratio declined to 124.3% in Q3 2010 from 133.3% in Q2 2010 and 140.3% in Q3 2009
Consolidated gross loan portfolio grew 3.1% q-o-q to GEL 2,247.3 million, up 21.4% YTD and up 23.1% y-o-y

â€œI am pleased to note that despite the 11.5% q-o-q client deposit growth outpacing the 3.1% q-o-q growth of gross loan book, the Bankâ€™s Net Interest Margin (NIM) remained flat at 8.2% in Q3 2010. This is primarily due to the decrease of Cost of Funds for the second consecutive quarter to 7.9% in Q3 2010 down from 8.3% in Q2 2010 and down from 8.6% in Q1 2010, as deposit rate cuts earlier in the year continued to produce results in the third quarter 2010.

Another highlight of the quarter is a 24.3% q-o-q decrease in consolidated NPLs to GEL 131.5 million representing 5.9% of the gross loan book. Improved operating environment in Georgia led to the improvement of the Bankâ€™s asset quality as standalone NPLs that peaked at GEL 136.8 million, or 7.4% of gross loan book in Q1 2010 declined to GEL 96.5 million, or 4.7% of the gross loan book as of 30 September 2010. Our Georgian retail portfolio, mortgage and credit card portfolios in particular, started to improve and we reduced our consolidated loan loss reserves by GEL 11.3 million q-o-q, bringing the loan loss reserves to gross loan book ratio down to 8.3% from 9.0% in Q2 2010. Improved asset quality and strong balance sheet have been reflected in the healthy increase of net operating cash flow by 67.4% to GEL 138.6 in nine months in 2010 compared to nine months in 2009â€, commented Giorgi Chiladze, Deputy Chief Executive Officer, Finance.

Q3 2010 summary of the Bankâ€™s consolidated results

In Q3 2010, the Bankâ€™s Total Operating Income (Revenue) increased 10.5% q-o-q to GEL 91.2million, (up 15.0% y-o-y), a result of 9.4% q-o-q growth of Net Interest Income to GEL 56.5 million (up 15.5% y-o-y), and 12.3% q-o-q growth of Net Non-Interest Income to GEL 34.7 million (up 14.1% y-o-y). On a quarterly basis, Interest Income growth of 5.8% q-o-q outpaced the 2.3% q-o-q growth of Interest Expense, the effect of the increase in lending and the deposit rate cuts in the beginning of the year, respectively. NIM of 8.2% for the quarter remained largely flat compared to the NIM of 8.3% in Q2 2010. On a year-on-year basis, Interest Income in Q3 2010 grew by 17.8% compared to 20.3% y-o-y growth of Interest Expense, as the Bankâ€™s Client Deposits were 40.3% higher as of 30 September 2010 compared to the same period last year. In Q3 2010, the Bankâ€™s Net Non-Interest Income grew by 12.3% q-o-q to GEL 34.7 million compared to Q2 2010 and 14.1% compared to Q3 2009. The quarterly growth of Net Non-Interest Income in Q3 2010 was primarily driven by the 26.5% q-o-q growth of Net Fee and Commission Income to GEL 13.7 million (up 14.0% y-o-y), in line with the increased lending and the overall increased business activity. The Bankâ€™s Net Income from Documentary Operations grew 13.8% q-o-q to GEL 2.5 million (up 5.6% y-o-y), while Net Foreign Currency Related Income amounted to GEL 8.0 million, down 9.2% q-o-q and up 24.1% y-o-y. Net Other Non-Interest Income increased by 15.9% q-o-q, driven by the 29.0% q-o-q increase of Net Insurance Income to GEL 5.4 million.

Total Consolidated Recurring Operating Costs for the quarter increased by 6.7% q-o-q to GEL 51.0 million, (up 13.5% y-o-y), a result of increased Personnel Costs (up 3.9% q-o-q) and the growth of administrative expenses due to headcount expansion in Georgia and overall growth of business. NNOI for the quarter increased by 15.6% q-o-q to GEL 40.1 million (up 16.9% y-o-y), while Normalized Cost/Income ratio in Q3 2010 declined to 56.0% from the Normalized Cost/Income ratio of 57.9% in Q2 2010 and 61.0% in Q1 2010.

The Bankâ€™s Consolidated Net Provision Expense for the quarter was GEL 14.2 million, up from Net Provision Expense of GEL 12.6 million in Q2 2010, with the increase largely attributed to the 95.1% increase of Net Provision Expense of BG Bank to GEL 3.8 million. Bank of Georgiaâ€™s Q3 2010 standalone Net Provision Expense of GEL 9.9 million increased from GEL 6.5 million in Q2 2010, when extraordinary reversals of provision charges have occurred. Cost of Risk for the quarter remained largely flat at 2.6% in Q3 2010 compared to the Cost of Risk of 2.4% in Q2 2010.

On 30 September 2010 the Bankâ€™s Consolidated Total Assets stood at GEL 3,615.6 million, up 5.6% from 30 June 2010 and up 24.1% from 31 December 2009. The gross loan book increased by 3.1% q-o-q to GEL 2,247.3 million as of the end of the second quarter, up 23.1% y-o-y and up 21.4% YTD.

In Q3 2010 Loan Loss Reserves of GEL 166.3 million amounted to 8.3% of consolidated gross loan book, a reduction from 9.0% in Q2 2010. Consolidated Net Loans increased by 4.0% q-o-q (up 24.2% y-o-y and up 22.8% YTD) to GEL 2,061.4 million. Consolidated NPLs of GEL 131.5 million declined considerably by 24.3% q-o-q, representing 5.9% of the consolidated gross loan book as of 30 September 2010, down from the same ratio of 8.0% in Q2 2010.

Client Deposits continued to grow during the quarter, resulting in the 11.5% q-o-q growth of the Bankâ€™s Total Client Deposits to GEL 1,658.5 million as of 30 September 2010, a 30.3% increase from 31 December 2009 and a 40.3% increase since 30 September 2009. As of 30 September 2010, the Bankâ€™s consolidated Net Loans/Client Deposits ratio stood at 124.3%, down from 133.3% in Q2 2010, 131.9% as of December 2010 and 140.3% as of Q3 2009.

YTD 2010 summary of the Bankâ€™s consolidated results

The Bank reported the YTD Net Income of GEL 57.2 million. In the nine months in 2010, the Bankâ€™s Total Operating Income (Revenue) increased 3.3% y-o-y to GEL 249.6 million, attributable to 1.7% y-o-y increase in Net Interest Income to GEL 153.4 million and 5.9% y-o-y increase in Net Non-Interest Income of GEL 96.2 million. In nine months in 2010, Net Foreign Currency Related Income increased by 8.5% y-o-y to GEL 24.2 million, predominantly due to the high FX volumes in Georgia during the year. The Bankâ€™s Net Fees and Commission Income increased 0.4% y-o-y to GEL 34.9 million, while Net Income from Documentary Operations grew by 7.0% y-o-y to GEL 6.8 million. YTD 2010 Net Other Non-Interest Income increased 10.6% y-o-y to GEL 30.2 million, with the Bankâ€™s insurance subsidiary contributing the YTD 2010 Net Insurance Income of GEL 13.8 million, up 6.2% y-o-y.

The YTD 2010 Consolidated Recurring Operating Costs increased 6.7% y-o-y to GEL 145.1 million, driven by the 13.0% y-o-y increase in Personnel Costs to GEL 76.3 million, a result of the increase of personnel due to the growth of business across the board during 2010. NNOI in the nine months of 2010 reached GEL 104.5 million, down by 1.1% y-o-y.

On a year-to-date basis, the Bankâ€™s Net Provision Expense dropped from GEL 102.8 million in nine months 2009 to GEL 34.2 million in nine months 2010, in line with the improvements in asset quality and the turnaround of Georgiaâ€™s economy during the year. The Bank had Net Provision Expense of GEL 28.7 million in Georgia and GEL 4.2 million in Ukraine. The Bank reported Net Income of GEL 57.2 million in nine months in 2010 compared to the Net Income of GEL 3.4 million in nine months in 2009.

The Bankâ€™s consolidated Book Value per Share on 30 September 2010 stood at GEL 21.69 (US$ 12.01), compared to GEL 20.74 (US$ 11.25) as at 30 June 2010 and GEL 19.12 (US$ 11.34) as of 31 December 2009.

JSC Bank of Georgia (standalone) results

Bank of Georgia on a standalone basis reported Q3 2010 Net Income of GEL 23.7 million, which compares to the standalone Net Income of GEL 24.4 million in Q2 2010 and GEL 10.8 million in Q3 2009. The slight decrease in Net Income in the third quarter is largely attributable to the q-o-q growth in standalone Net Provision Expenses, due to extraordinary reversal of provision charges in Q2 2010.

In Q3 2010, Total Operating Income on a standalone basis amounted to GEL 74.9 million, up 8.4% q-o-q (up 21.9% y-o-y). Net Interest Income grew 8.6% q-o-q to GEL 52.5 million, driven by 5.5% q-o-q increase of Interest Income to GEL 101.2 million, outpacing the 2.3% q-o-q growth of Interest Expense to GEL 48.7 million. Interest Income growth during the quarter was driven by the healthy loan book growth of the past quarters, while interest expense continued to grow at a slower pace compared to the previous quarters, benefiting from the interest rate cuts on deposits in Georgia. On a year-on-year basis, the 17.9% increase of Net Interest Income was predominantly related to the increase in loan book since the beginning of 2010. In Q3 2010 Net Non-Interest Income amounted to GEL 22.5 million, up 8.1% q-o-q and up 32.3% y-o-y, with the growth driven by the 4.0% q-o-q increase of the Net Foreign Currency Related Income to GEL 8.1 million, the 13.5% q-o-q growth of Net Fees and Commission Income to GEL 11.4 million and a 14.1% q-o-q increase in Net Income from Documentary Operations. On a standalone basis, Bank of Georgiaâ€™s Total Recurring Operating Costs increased 7.4% q-o-q to GEL 34.9 million (up 16.0% y-o-y), primarily due to the increase of the Personnel Costs driven by the headcount increase to GEL 19.5 million, up 13.4% q-o-q (up 32.8% y-o-y) and the increase in operations support expenses attributed to the growth of business during the quarter. On a standalone basis, Bank of Georgia achieved positive operating leverage of 1.4% on a consecutive q-o-q basis and 3.6% on a y-o-y basis. The Bankâ€™s Net Provision Expense on a standalone basis increased from GEL 6.5 million in Q2 2010 to GEL 9.9 million in Q3 2010.

Bank of Georgiaâ€™s YTD 2010 standalone Total Operating Income on a standalone basis grew by 6.8% y-o-y to GEL 203.4 million. Net Interest Income in the nine months of 2010 increased by 2.2% y-o-y to GEL 143.4 million, as 9.0% y-o-y growth of Interest Income to GEL 284.6 million offset the 16.9% y-o-y growth rate of Interest Expense which increased to GEL 141.2 million in nine months 2010. Net Non-Interest Income increased by 19.9% y-o-y to GEL 60.0 million, with the increase driven by 20.2% y-o-y increase of Net Foreign Currency Related Income to GEL 21.6 million and 23.2% y-o-y increase in Net Fees and Commission Income to GEL 29.9 million. Net Income from Documentary Operations reached GEL 6.6 million, up 4.3% y-o-y. The Total Recurring Cost of Bank of Georgia on a standalone basis increased by 10.8% y-o-y, driven by a 18.0% increase of Personnel Costs on a y-o-y basis, a result of increased headcount in line with the increase in lending and overall business activity during the period. Net Provision Expense in nine months in 2010 reached GEL 28.7 million, compared to GEL 71.3 million Net Provision Expense in the nine months in 2009, resulting in YTD 2010 Standalone Net Income of GEL 60.9 million, up 164.7% y-o-y.

As of 30 September 2010, Bank of Georgiaâ€™s Total Assets on a standalone basis stood at GEL 3.5 billion, up 5.7% q-o-q, up 27.9% y-o-y and up 23.9% YTD. Gross loans increased 4.0% q-o-q (up 24.8% y-o-y and up 18.8% YTD) to GEL 2.1 billion driven by 2.3% q-o-q increase of the corporate gross loan book to GEL 1,038.9 million and 5.5% q-o-q growth of retail gross loan book to GEL 980.6 million. NPLs stood at GEL 96.5 million and represented 4.7% of the total gross loan book, a decrease from the same ratio of 6.5% in Q2 2010, when the NPLs amounted to GEL 129.2 million on a standalone basis.

In Q3 2010, the Bankâ€™s Client Deposits in Georgia stood at GEL 1,512.4 million, up 12.7% q-o-q, up 34.2% YTD and up 43.0% y-o-y. The growth of Client Deposits during the period was mostly driven by the increase of both Corporate and Retail Banking client deposits by GEL 116.9 million and by GEL 45.6 million, respectively.

As of 30 September 2010 Bank of Georgia on a standalone basis held market share of 34%, 34%, and 30% by total assets, gross loans, and client deposits, respectively in Georgia. Since the year-end 2009, the Bank gained market shares of 1.2% by assets, 2.2% by gross loans and 2.0% by client deposits⁷.

The business segment discussion set forth below is derived from IFRS-based management reports. Business segment results of RB, CB and WM represent Bank of Georgiaâ€™s standalone performance and do not include intercompany eliminations.

In 2010 the Bank introduced new model for standalone segment reporting. The comparative numbers for Q3 2009 business segment reporting have been adjusted respectively.

Retail Banking (RB)

GEL millions, unless otherwise noted	Â	Q3 2010	Â	Q2 2010*	Â	Q3 2009	Â	Change Q-O-Q	Â	Change Y-O-Y
Total operating income (Revenue)		42.0		37.2		36.7		13.0%		10.6%
Total recurring operating costs		23.0		21.0		20.1		9.4%		12.6%
Net income / (Loss)		12.9		2.0		5.0		NMF		102.9%
Loans to clients, gross		980.6		929.6		831.3		5.5%		18.0%
Loans to clients, net		910.9		849.0		758.1		7.3%		20.2%
Client deposits		494.2		448.6		326.3		10.2%		51.5%

* Q2 2010 numbers have been restated

Discussion of results

RB Revenues increased 13.0% q-o-q (up 10.6% y-o-y) to GEL 42.0 million, a result of the growth of all RB revenue items in Q3 2010. RB Net Interest Income increased by 11.5% q-o-q (up 3.8% y-o-y) to GEL 28.3 million, as RB Interest Income growth of 10.4% q-o-q to GEL 54.7 million more than offset the 9.2% q-o-q growth rate of RB Interest Expense to GEL 25.4 million in Q3 2010. RB Net Non-Interest Income during the quarter increased by 16.7% q-o-q (up 30.7% y-o-y) to GEL 12.6 million, mostly driven by 14.3% q-o-q increase of RB Net Fee and Commission Income to GEL 9.6 million (up 41.4%- y-o-y). RB Recurring Operating Costs increased by 9.4% q-o-q to GEL 23.0 million (up 12.6% y-o-y), translating into a positive operating leverage for the quarter. The improvement of the RB loan book quality as well as healthy loan recovery during the quarter, translated into a 78.4% q-o-q drop in RB Net Provision Expense to GEL 2.7 million. On a year-on-year basis, the Q3 2010 RB Net Provision Expense improved by 76.4%, reflecting the upturn of the overall operating environment during the year. Net Income for Q3 2010 amounted to GEL 12.9 million, contributing 54.2% to the standalone Net Income and 61.7% to the consolidated Net Income.

On an YTD basis, RB Revenues decreased 8.0% y-o-y to GEL 111.9 million, driven predominantly by the 14.1% y-o-y decrease in RB Net Interest Income to GEL 79.2 million which more than offset 21.3% y-o-y growth of Net Fee and Commission income to GEL 25.3 million and 30.5% y-o-y growth of Net other Non-Interest income to GEL 0.8 million. YTD 2010 RB Recurring Operating Costs grew by 6.2% y-o-y to GEL 64.2 million, leading to the 26.9% y-o-y decrease of RB Profit Before Provisions to GEL 44.8 million. The Net Provision Expense for RB in nine months in 2010 reached GEL 24.8 million, down 63.2% from nine months in 2009.

RB gross loans increased 5.5% q-o-q to GEL 980.6 million (up 18.0% y-o-y and up 21.6% YTD), as a result of a pick-up in the retail lending activity during nine months in 2010. RB Client Deposits grew 10.2% q-o-q, 31.4% YTD and 51.5% y-o-y to GEL 494.2 million, driven primarily by the growth of time deposits.

Highlights

Issued 44,319 debit cards in Q3 2010 bringing the total debit cards outstanding to 470,913 .
Issued 28,304 credit cards of which 20,240 American Express cards in Q3 2010. A total of 34,359 American Express cards were issued since the launch in November 2009. The total number of credit cards outstanding amounted to 94,480 as of 30 September 2010.
Outstanding number of RB clients reached 729,578, up 2.1% q-o-q up 4.0% y-o-y.
Acquired 141 new clients in Solo business line, Bank of Georgiaâ€™s mass affluent sub-brand. As of 30 September, the number of Solo clients reached 1,608.
Stepped up mortgage loan originations to GEL 55.2 million in Q3 2010 (up 20.1% q-o-q) resulting in mortgage loans outstanding by 30 September 2010 of GEL 392.4 million, up 14.9% y-o-y and up 15.0% YTD.
Consumer loan originations of GEL 69.8 million (up 8.5% q-o-q and up 51.1% y-o-y) resulted in consumer loans outstanding in the amount of GEL 146.9 million as of 30 September 2010, up 17.0% y-o-y and up 28.8% YTD.
Micro loan originations of GEL 78.3 million (up 9.2% q-o-q and up 204.1% y-o-y) resulted in micro loans outstanding in the amount of GEL 182.6 million as of 30 September 2010, up 97.2% y-o-y and up 84.7% YTD.
Car loan originations of GEL 6.9 million (up 37.8% q-o-q) resulted in car loans outstanding in the amount of GEL 50.7 million as of 30 September 2010, down 20.2% y-o-y and down 10.4% YTD.
SME Unit previously part of Corporate business segment became part of Retail business segment, a move that will help better utilize the Bankâ€™s superior retail branch network. SME Unit portfolio stood at GEL 25.6 million as of Q3 2010.

Corporate Banking (CB)

GEL millions, unless otherwise noted	Â	Q3 2010	Â	Q2 2010*	Â	Q3 2009	Â	Change Q-O-Q	Â	Change Y-O-Y
Total operating income (Revenue)		31.5		31.2		23.8		1.0%		39.5%
Total recurring operating costs		10.7		10.6		9.0		1.1%		25.4%
Net income		10.6		22.6		7.8		-51.8%		78.7%
Loans to clients, gross		1,038.9		1,015.5		764.7		2.3%		35.9%
Loans to clients, net		976.5		961.2		718.5		1.6%		35.9%
Client deposits		799.4		682.5		596.8		17.1%		34.0%

* Q2 2010 numbers have been restated

Discussion of results

CB Revenues increased 1.0% q-o-q to GEL 31.5 million (up 39.5% y-o-y), driven by the 1.5% q-o-q growth of CB Net Interest Income to GEL 22.0 million (up 40.5% y-o-y). Net Non-Interest Income during the quarter decreased by 0.3% q-o-q (up 37.1% y-o-y) to GEL 9.5 million, mostly a result of 4.3% decrease of CB Net Foreign Currency Related Income to GEL 5.3 million. CB Net Fee and Commission Income increased 7.4% to GEL 1.6 million (up 38.2%- y-o-y), reflecting the growth of CB loan book. CB Recurring Operating Costs increased by 1.1% q-o-q to GEL 10.7 million (up 25.4% y-o-y), resulting in a positive operating leverage for the quarter. CB Net Provision Expense for the quarter amounted to GEL 7.2 as compared to the CB Net Provision Reversal in Q2 2010 which amounted to GEL 6.1 million. Net Income for Q3 2010 amounted to GEL 10.9 million, contributing 46.0% to the standalone Net Income for the quarter and 52.3% to the consolidated Net Income.

On a YTD basis, CB Revenues increased 33.8% y-o-y to GEL 88.0 million, driven predominantly by the 33.6% y-o-y increase in CB Net Interest Income to GEL 61.7 million and 52.7% y-o-y growth of Net Foreign Currency Related Income to GEL 14.5 million. During nine months in 2010, CB Recurring Operating Costs grew by 23.9% y-o-y to GEL 30.7 million, resulting in a 48.0% y-o-y increase of CB Profit Before Provisions. The YTD 2010 Net Provision Expense for CB reached GEL 6.5 million as compared to GEL 1.1 million in nine months in 2009.

CB gross loans increased 2.3% q-o-q to GEL 1,038.9 million (up 35.9% y-o-y and 18.0% YTD), while CB Client Deposits grew 36.1% YTD and 34.0% y-o-y to GEL 799.4 million, up 17.1% q-o-q.

Highlights

Increased the number of corporate clients using the Bankâ€™s payroll services from 1,567 as of Q2 2010 to 1,657 in Q3 2010. By 30 September 2010, the number of individual clients serviced through the corporate payroll programs administered by the Bank decreased from approximately 167,219 as of 30 September 2009 to 163,412 as of 30 September 2010.
More than 6,000 new corporate accounts opened at the Bank in Q3 2010, bringing the total to over 171,000.

Wealth Management (WM)

GEL millions, unless otherwise noted	Â	Q3 2010	Â	Q2 2010*	Â	Q3 2009	Â	Change Q-O-Q	Â	Change Y-O-Y
Total operating income (Revenue)		1.4		0.8		1.0		91.8%		50.6%
Total recurring operating costs		1.2		0.9		1.0		34.3%		5.6%
Net income / (Loss)		(0.0)		(0.2)		(1.6)		NMF		NMF
Loans to clients, gross		41.1		36.3		55.3		13.2%		-25.6%
Loans to clients, net		38.4		33.7		51.4		13.9%		-25.3%
Client deposits		218.7		211.2		134.4		3.6%		62.7%

* Q2 2010 numbers have been restated

Discussion of results

WM Client Deposits continued to grow reaching GEL 218.7 million, up 3.6% q-o-q and up 62.7 y-o-y, while WM Loan book increased 13.2% q-o-q to GEL 41.1 million. WM Revenue grew 91.8% q-o-q to GEL 1.4 million as Interest Expense decreased by 7.1% q-o-q to GEL 5.2 million. Interest income grew by 6.6% q-o-q to GEL 6.4 million. The WM Net Non-Interest Income during the quarter decreased by 25.3% q-o-q (down 17.9% y-o-y) to GEL 295.6 thousand, mostly driven by 54.0% q-o-q decrease of Net WM Foreign Currency related Income to GEL 126.2 thousand (down 23.8% y-o-y). WM Net Fee and Commission Income increased 28.9% q-o-q (up 56.9% y-o-y) to GEL 157.0 thousand. WM Total Recurring Operating Costs increased by 34.3% q-o-q to GEL 1.2 million (up 5.6% y-o-y). WM Net Provision Reversal amounted to GEL 53.8 thousand in Q3 2010 compared to Q2 2010 Net Provision Expense of GEL 30.3 thousand. Net Loss for Q3 2010 amounted to GEL 54.4 thousand compared to the Net Loss of GEL 160.4 thousand in Q2 2010.

On a YTD basis, WM Revenues increased by 17.4% y-o-y to GEL 3.5 million, driven predominantly by the 27.0% y-o-y increase in WM Net Interest Income to GEL 2.5 thousand that more than offset the 1.9% y-o-y decline of Net Non Interest Income to GEL 1.0 million. Nine months 2010 WM Recurring Operating Costs declined by 3.0% y-o-y to GEL 3.1 million, leading to the WM Loss Before Provisions of GEL 19.8 thousand compared to the WM Pre-Provison Loss of GEL 405.9 thousand in nine months 2009. The Net Provision Reversal for WM in nine months 2010 reached GEL 2.6 million compared to the Net Provision Expense of GEL 3.0 million in nine months 2009.

Highlights

WM Assets under management reached GEL 247.2 million as of 30 September 2010, up from GEL 235.7 million as of 30 June 2010, or 4.9% q-o-q.
The number of WM clients amounted to 1,331 clients, of which 433 were non-resident WM clients, up from 365 non-resident WM clients as of 30 September 2009.
Launched Bank of Georgia Representative Office in London that will principally focus on introducing the Bankâ€™s wealth management offerings to the prospective clients it the UK. The opening of the Representative Office in London following the success of WM activities in Israel is in line with the Bankâ€™s WM strategy of deposit raising internationally.

Belaruskiy Narodniy Bank, Belarus (BNB)

GEL millions, unless otherwise noted	Â	Q3 2010	Â	Q2 2010	Â	Q3 2009	Â	Change Q-O-Q	Â	Change Y-O-Y
Total operating income (Revenue)		3.2		3.0		2.1		6.3%		50.3%
Total recurring operating costs		2.5		2.0		1.5		25.3%		72.2%
Net income		0.8		0.6		0.6		34.2%		24.1%
Loans to clients gross		51.7		41.8		25.7		23.7%		100.8%
Loans to clients, net		50.4		39.7		25.5		26.7%		97.9%
Client deposits		18.4		15.7		17.9		16.9%		2.6%

Discussion of results

In Q3 2010 BNBâ€™s Total Operating Income increased to GEL 3.2 million, up 6.3% q-o-q, mostly driven by the 54.5 % q-o-q growth of Net Non-Interest Income to GEL 1.0 million (up 46.4 % y-o-y) a result of the growth in Net Foreign Currency Related Income to GEL 527.0 thousand, up 186.4% q-o-q and up 91.2 % y-o-y. BNBâ€™s Net Interest Income decreased by 6.6 % q-o-q to GEL 2.2 million, Interest Expense growing by 16.9 % and Interest Income declining by 4.7 % q-o-q. In Q3 2010, BNBâ€™s Recurring Costs increased 25.3% q-o-q to GEL 2.5 million as the bank positions itself for growth. BNBâ€™s Net Provision Expense for the quarter amounted to GEL 32.0 thousand as compared to GEL 236.0 thousand in Q2 2010. BNB posted Net Income of GEL 766.0 thousand as compared to Net Income of GEL 571.0 thousand in Q2 2010 and Net Income of GEL 617.0 thousand in Q3 2009.

In Q3 2010 BNBâ€™s Gross Loans increased by 23.7% q-o-q (up 100.8% y-o-y). On 30 September 2010 Total Assets stood at GEL 116.2 million, up 103.8% y-o-y. Client Deposits amounted to GEL 18.4 million, up 16.9% q-o-q. Total Liabilities of BNB stood at GEL 54.4 million, up 92.3% q-o-q.

Highlights

Increased the number of corporate clients by 22.5% y-o-y to 1,335 as of 30 September 2010.
Increased the number of corporate clients using the BNBâ€™s payroll services by 84.7% y-o-y to 182 as of 30 September 2010.
Upgraded Retail lending risk management.
Launched Internet & mobile banking.
Rolled out three new SME and retail banking products: Investment Loan â€“ long-term loan SMEs for financing investments in equipment, machinery and fixed assets; Multipurpose secured long-term loans to retail clients and Car Loans.

BG Bank (Ukraine)

GEL millions, unless otherwise noted	Â	Q3 2010	Â	Q2 2010	Â	Q3 2009	Â	Change Q-O-Q	Â	Change Y-O-Y
Total operating income (Revenue)		3.0		4.3		5.3		-30.1%		-42.7%
Total recurring operating costs		3.3		4.9		3.9		-32.9%		-16.8%
Net income / (Loss)		(3.1)		(1.7)		(5.5)		85.5%		-43.7%
Loans to clients, gross		191.6		207.7		179.6		-7.8%		8.3%
Loans to clients, net		134.6		143.4		136.0		-6.1%		-1.1%
Client deposits		155.2		142.0		117.1		9.3%		32.5%

Discussion of results

In Q3 2010 BG Bankâ€™s Revenue amounted to GEL 3.0 million, down by 30.1% q-o-q (down 42.7% y-o-y). Recurring Costs stood at GEL 3.3 million, compared to GEL 4.9 million in Q2 2010 and down 16.8% y-o-y, a result of tightening of the lending activity in Ukraine and the effects of the downsizing of the BG Bank . BG Bankâ€™s Net Provision Expense for the quarter amounted to GEL 3.8 million as compared to Net Provision Expense of GEL 2.0 million in Q2 2010. In Q3 2010 BG Bank recorded Net Loss of GEL 3.1 million that compares to the Net Loss of GEL 5.5 million for the same period last year.

On a YTD basis, BG Bank reported a Net Loss of GEL 4.5 million, compared to the Net Loss of GEL 23.6 million in nine months 2009.

BG Bankâ€™s Total Assets decreased by 9.7 % q-o-q to GEL 194.3 million (down 3.8 % y-o-y), driven primarily by the 7.8% q-o-q decline of BG Bankâ€™s gross loans to GEL 191.6 million (up 6.7 % y-o-y), reflecting the Bankâ€™s cautious lending policy in Ukraine. BG Bankâ€™s Loan Loss Reserves declined 11.4% q-o-q to GEL 56.9 million or 29.7% of BG Bankâ€™s gross loan book. As at 30 September 2010, BG Bankâ€™s NPLs stood at GEL 32.7 million, or 17.1 % of BG Bankâ€™s gross loan book.

BG Bankâ€™s Client Deposits increased by 9.3% q-o-q to GEL 155.2 million, up 32.5% y-o-y. BG Bankâ€™s Total Liabilities stood at GEL 165.5 million in Q3 2010, up 3.1% y-o-y and down by 9.1% q-o-q.

Insurance

GEL millions, unless otherwise noted	Â	Q3 2010	Â	Q2 2010	Â	Q3 2009	Â	Change Q-O-Q	Â	Change Y-O-Y
Total operating income (Revenue)		4.2		6.0		6.1		-31.2%		-32.0%
Total recurring operating costs		2.5		4.9		3.8		-48.6%		-33.8%
Net income		1.3		0.9		1.6		52.6%		-18.9%
Gross premiums written		15.0		16.8		15.6		-10.9%		-4.3%

Discussion of results

Standalone Revenue of Aldagi BCI (ABCI), the Bankâ€™s wholly-owned insurance subsidiary, decreased by 31.2% q-o-q to GEL 4.2 million, with standalone Gross Premiums Written down 4.3% y-o-y to GEL 15.0 million. Standalone Operating Costs were GEL 2.5 million, down 48.6% q-o-q. The cleanup of the portfolio from loss making accounts led to the larger decline in ABCIâ€™s Recurring Costs than in its Revenue, leading to the 52.6% q-o-q increase in ABCIâ€™s Q3 2010 Net Income to GEL 1.3 million. Total Assets amounted to GEL 86.1 million, while Total Liabilities reached GEL 65.5 million as at 30 September 2010.

Highlights

Number of retail clients exceeded 221,000 as of the end of Q3 2010.
As a result of a tender, construction works for building six healthcare facilities on six sites in Western Georgia have commenced. ABCI operates four outpatient clinics and one mid-sized hospital and intends to add six more healthcare facilities in line with the Bankâ€™s strategy to vertically integrate the health insurance business.

BG Capital

In Q3 2009 BG Capital posted Revenue of GEL 1.0 million, that compares to GEL 0.9 million in Q3 2009.Â Recurring Operating Costs of BG Capital were down 11.8% q-o-q to GEL 1.9 million, up 37.7% y-o-y. Net Loss for the quarter reached GEL 0.8 million, compared to the Net Loss of GEL 1.9 million in Q2 2010 and Net Loss of GEL 1.7 million in Q3 2009.

BG Capital was not immune to the drop in brokerage activity across the CIS in 3Q10, however this was somewhat offset by continued growth in the companyâ€™s investment banking business. BG Capital also continued to solidify its position as the leading brokerage in the CIS frontier space. To address the weaker-than-expected volumes in the brokerage business, BG Capitalâ€™s management began taking steps to implement a cost optimization program.

Comment:

â€œDuring Q3 2010 we continued to experience a strong growth of our core business lines, extending more than GEL 517.4 million in new loans on a consolidated basis throughout the year. Our deposits grew 40.3% y-o-y to a record GEL 1,658.5 million and the loan book quality improved notably with the non-performing loans represent 5.9% of the gross loan book as of Q3 2010. Strong credit and deposit growth once again underlines strong recovery of the Georgian economy, which showed remarkable real GDP growth rate of 8.4% y-o-y in Q2 2010 and 6.6% y-o-y in the first half of 2010.

We continue to be firmly committed to working on our priorities going forward. We have moved our SME business from Corporate to Retail to take advantage of our retail infrastructure in order to penetrate this market segment currently dominated by our competitors. We continue targeting the Georgian mass-affluent retail segment through the already well-established sub-brand Solo and intend to further expand our wealth management business internationally. As the close-to-zero percent growth environment in the developed countries is likely to persist for some time, we will continue attracting more deposits internationally through our wealth management offices in Tel Aviv and London and open more offices elsewhere.

We are strongly positioned to benefit the most from the growing demand for retail and corporate credit in Georgia and we are keeping our unrelenting focus on our asset quality and efficiency as we embark upon the growth in 2011 and beyond,â€ commented Irakli Gilauri, Chief Executive Officer.

STANDALONE Q3 2010 SEGMENT INCOME STATEMENT DATA

	Â	CB			Â	RB			Â	WM			Â	CC/ Eliminations			Â	Total
GEL millions, unless otherwise noted		Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09
Interest Income		45.3	Â	35.6	Â	54.7	Â	47.0	Â	6.4	Â	4.0	Â	(5.2)	Â	(2.0)	Â	101.2	Â	84.6
Interest Expense		23.3		19.1		25.4		19.0		5.2		4.0		(5.2)		(2.0)		48.7		40.1
Net Interest Income		22.0		16.5		29.3		28.0		1.2		-		-		-		52.5		44.5
Net Non-Interest Income		9.4		7.3		12.7		9.7		0.3		-		-		-		22.4		17.0
Total Operating Income (Revenue)		31.4		23.8		42.0		36.7		1.5		1.0		-		-		74.9		61.5
Total Recurring Operating Costs		10.7		9.0		22.9		20.1		1.2		1.0		-		-		34.8		30.1
Normalized Net Operating Income / (Loss)		20.7		14.8		19.1		16.6		0.3		-		-		-		40.1		31.4
Net Non-Recurring Income / (Costs)		(0.6)		(2.0)		(0.9)		1.0		(0.4)		-		-		-		(1.9)		(1.0)
Net Provision Expense / (Reversal)		7.3		4.0		2.8		11.7		(0.1)		2.0		-		-		10.0		17.7
Net Income / (Loss)		10.6		7.8		12.9		5.0		0.0		(2.0)		-		-		23.5		10.8

STANDALONE Q3 2010 SEGMENT BALANCE SHEET DATA

	Â	CB			Â	RB			Â	WM			Â	CC/ Eliminations			Â	Total
GEL millions, unless otherwise noted		Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09	Â	Q3 '10	Â	Q3 '09
Loans To Clients, Gross		1,038.9	Â	764.7	Â	980.6	Â	831.3	Â	41.1	Â	55.3	Â	0.0	Â	0.0	Â	2,060.6	Â	1,651.3
Loans To Clients, Net		976.5		718.5		910.9		758.0		38.4		51.4		0.0		0.0		1,925.8		1,527.9
Total Assets		1,515.0		1,051.0		1,629.0		1,338.2		45.0		59.0		333.0		304.0		3,522.0		2,753.0
Client Deposits		799.5		596.8		494.2		326.3		218.7		134.4		0.0		0.0		1,512.4		1,057.5
Total Liabilities		1,380.0		988.0		1,107.0		902.0		219.0		134.4		0.0		0.0		2,706.0		2,025.0
Total Shareholders Equity		259.0		218.0		216.0		194.0		8.0		12.0		333.0		304.0		816.0		728.0
Total Liabilities And Shareholdersâ€™ Equity		1,639.0		1,206.0		1,323.0		1,096.0		227		146.0		333.0		304.0		3,522.0		2,753.0

CONSOLIDATED Q3 2010 INCOME STATEMENT

Period ended	Â	Q3 2010			Â	Q2 2010			Â	Q3 2009			Â	Change⁴	Â	Change⁴
Consolidated, IFRS based		US$¹	Â	GEL		US$²	Â	GEL		US$³	Â	GEL		Q-O-Q		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)				(Unaudited)
																	Â
Interest Income		61,095		110,362		56,565		104,317		55,874		93,707		5.8%		17.8%
Interest Expense		29,821		53,869		28,557		52,664		26,703		44,783		2.3%		20.3%
Net Interest Income		31,274		56,493		28,008		51,653		29,172		48,924		9.4%		15.5%
Fees & Commission Income		8,752		15,809		7,473		13,782		9,002		15,097		14.7%		4.7%
Fees & Commission Expense		1,149		2,075		1,585		2,923		1,819		3,050		-29.0%		-32.0%
Net Fees & Commission Income		7,603		13,734		5,888		10,859		7,183		12,047		26.5%		14.0%
Income From Documentary Operations		1,628		2,940		1,427		2,632		1,669		2,799		11.7%		5.0%
Expense On Documentary Operations		271		490		260		480		286		480		2.1%		2.1%
Net Income From Documentary Operations		1,356		2,450		1,167		2,152		1,383		2,319		13.8%		5.6%
Net Foreign Currency Related Income		4,445		8,030		4,797		8,846		3,858		6,471		-9.2%		24.1%
Net Insurance Income / (Loss)		3,012		5,441		2,288		4,219		2,935		4,923		29.0%		10.5%
Brokerage And Investments Banking Income		260		469		11		20		1,138		1,908		NMF		-75.4%
Asset Management Income		30		55		29		53		125		210		3.8%		-73.8%
Net Investment Gains / (Losses)		266		480		88		162		(314)		(526)		196.3%		NMF
Other		2,224		4,018		2,482		4,577		1,807		3,030		-12.2%		32.6%
Net Other Non-Interest Income		5,792		10,463		4,897		9,031		5,691		9,545		15.9%		9.6%
Net Non-Interest Income		19,197		34,677		16,749		30,888		18,116		30,382		12.3%		14.1%
Total Operating Income (Revenue)		50,471		91,170		44,757		82,541		47,288		79,306		10.5%		15.0%
Personnel Costs		14,930		26,969		14,068		25,945		13,306		22,315		3.9%		20.9%
Selling, General & Administrative Expenses		5,803		10,483		4,822		8,892		6,278		10,529		17.9%		-0.4%
Procurement & Operations Support Expenses		2,124		3,837		1,793		3,306		1,762		2,955		16.1%		29.8%
Depreciation And Amortization		3,845		6,945		3,547		6,542		3,762		6,310		6.2%		10.1%
Other Operating Expenses		1,546		2,792		1,690		3,116		1,700		2,851		-10.4%		-2.1%
Total Recurring Operating Costs		28,247		51,026		25,920		47,801		26,808		44,960		6.7%		13.5%
Normalized Net Operating Income / (Loss)		22,223		40,144		18,837		34,740		20,479		34,346		15.6%		16.9%
Net Non-Recurring Income / (Costs)		(912)		(1,647)		812		1,498		(1,136)		(1,906)		NMF		-13.6%
Profit / (Loss) Before Provisions		21,311		38,497		19,650		36,238		19,343		32,440		6.2%		18.7%
Net Provision Expense		7,864		14,206		6,830		12,595		17,889		30,001		12.8%		-52.6%
Pre-Tax Income / (Loss)		13,447		24,291		12,820		23,643		1,454		2,439		2.7%		NMF
Income Tax Expense / (Benefit)		1,915		3,460		2,198		4,053		(113)		(189)		-14.6%		NMF
Net Income / (Loss)		11,532		20,831		10,622		19,590		1,567		2,628		6.3%		NMF

¹ Converted to U.S. dollars for the convenience using a period-end exchange rate of GEL 1.806 per US$1.00, such exchange rate being the official Georgian Lari to U.S. dollar period-end exchange rate as reported by the National Bank of Georgia on 30 September 2010

² Converted to U.S. dollars for the convenience using a period-end exchange rate of GEL 1.844 per US$1.00, such exchange rate being the official Georgian Lari to U.S. dollar period-end exchange rate as reported by the National Bank of Georgia on 30 June 2010

³ Converted to U.S. dollars for the convenience using a period-end exchange rate of GEL 1.677 per US$1.00, such exchange rate being the official Georgia Lari to U.S. dollar period-end exchange rate as reported by the National Bank of Georgia on 30 September 2009

⁴ Change calculations based on GEL values

CONSOLIDATED NINE MONTHS INCOME STATEMENT

Period ended	Â	9 months 2010			Â	9 months 2009			Â	Change³
Consolidated, IFRS based		US$¹	Â	GEL		US$²	Â	GEL		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)
											Â
Interest Income		171,449		309,706		172,969		290,087		6.8%
Interest Expense		86,531		156,310		83,053		139,289		12.2%
Net Interest Income		84,918		153,396		89,916		150,798		1.7%
Fees & Commission Income		23,697		42,806		25,520		42,799		0.0%
Fees & Commission Expense		4,371		7,895		4,786		8,026		-1.6%
Net Fees & Commission Income		19,326		34,911		20,734		34,773		0.4%
Income From Documentary Operations		4,555		8,229		4,693		7,871		4.5%
Expense On Documentary Operations		803		1,450		917		1,538		-5.7%
Net Income From Documentary Operations		3,753		6,779		3,776		6,333		7.0%
Net Foreign Currency Related Income		13,406		24,216		13,305		22,313		8.5%
Net Insurance Income / (Loss)		7,650		13,819		7,762		13,017		6.2%
Brokerage And Investments Banking Income		391		706		2,142		3,593		-80.4%
Asset Management Income		83		150		374		628		-76.1%
Net Investment Gains / (Losses)		1,445		2,611		(133)		(223)		NMF
Other		7,196		12,999		6,183		10,370		25.4%
Net Other Non-Interest Income		16,765		30,285		16,329		27,385		10.6%
Net Non-Interest Income		53,250		96,191		54,143		90,804		5.9%
Total Operating Income (Revenue)		138,168		249,587		144,059		241,602		3.3%
Personnel Costs		42,236		76,295		40,244		67,493		13.0%
Selling, General & Administrative Expenses		16,153		29,178		19,196		32,193		-9.4%
Procurement & Operations Support Expenses		5,896		10,650		5,843		9,800		8.7%
Depreciation And Amortization		11,148		20,138		10,775		18,071		11.4%
Other Operating Expenses		4,885		8,825		4,992		8,372		5.4%
Total Recurring Operating Costs		80,318		145,086		81,050		135,929		6.7%
Normalized Net Operating Income / (Loss)		57,850		104,501		63,009		105,673		-1.1%
Net Non-Recurring Income / (Costs)		(1,891)		(3,415)		(1,445)		(2,424)		40.9%
Profit / (Loss) Before Provisions		55,960		101,086		61,564		103,249		-2.1%
Net Provision Expense		18,911		34,161		61,268		102,752		-66.8%
Pre-Tax Income / (Loss)		37,049		66,925		296		497		NMF
Income Tax Expense / (Benefit)		5,397		9,749		(1,721)		(2,886)		NMF
Net Income / (Loss)		31,652		57,176		2,017		3,383		NMF

² Converted to U.S. dollars for the convenience using a period-end exchange rate of GEL 1.677 per US$1.00, such exchange rate being the official Georgia Lari to U.S. dollar period-end exchange rate as reported by the National Bank of Georgia on 30 September 2009

³ Change calculations based on GEL values

CONSOLIDATED Q3 2010 BALANCE SHEET

Period ended	Â	Q3 2010			Â	Q2 2010			Â	Q3 2009			Â	Change⁴	Â	Change⁴
Consolidated, IFRS based		US$¹	Â	GEL		US$²	Â	GEL		US$³	Â	GEL		Q-O-Q		Y-O-Y
000s Unless otherwise noted		(Unaudited)								(Unaudited)
																	Â
Cash And Cash Equivalents		75,317		136,052		80,078		147,679		98,714		165,553		-7.9%		-17.8%
Loans And Advances To Credit Institutions		265,813		480,165		206,672		381,144		228,380		383,016		26.0%		25.4%
Mandatory Reserves With NBG / NBU / NBRB		47,986		86,682		27,333		50,408		22,795		38,230		72.0%		126.7%
Other Accounts With NBG / NBU / NBRB		41,881		75,654		3,248		5,990		52,408		87,893		NMF		-13.9%
Balances With And Loans To Other Banks		175,946		317,829		176,090		324,746		153,177		256,893		-2.1%		23.7%
Investment Securities: AFS & Trading Securities		7,124		12,869		19,239		35,480		17,909		30,036		-63.7%		-57.2%
Investment Securities: HTM, Treasuries And Equivalents		164,803		297,701		145,450		268,238		21,826		36,605		11.0%		NMF
Investment Securities: HTM, Other Fixed Income Instruments		-		-		-		-		40,043		67,156		NMF		-100%
Loans To Clients, Gross		1,244,095		2,247,333		1,181,929		2,179,714		1,088,597		1,825,686		3.1%		23.1%
Less: Reserve For Loan Losses		(102,953)		(185,974)		(106,945)		(197,228)		(99,182)		(166,338)		-5.7%		11.8%
Loans To Clients, Net		1,141,142		2,061,359		1,074,984		1,982,486		989,415		1,659,348		4.0%		24.2%
Insurance Related Assets		18,620		33,635		18,668		34,427		27,177		45,578		-2.3%		-26.2%
Investment Property		62,801		113,443		53,931		99,459		32,345		54,246		14.1%		109.1%
Investments In Other Business Entities, Net		3,237		5,847		2,916		5,378		12,664		21,240		8.7%		-72.5%
Property And Equipment Owned, Net		161,602		291,918		158,860		292,969		178,840		299,933		-0.4%		-2.7%
Intangible Assets Owned, Net		12,568		22,703		12,669		23,365		7,271		12,194		-2.8%		86.2%
Goodwill		38,282		69,152		37,496		69,151		80,931		135,729		0.0%		-49.1%
Tax Assets, Current And Deferred		14,418		26,044		13,489		24,877		7,695		12,906		4.7%		101.8%
Prepayments And Other Assets		35,823		64,711		31,959		58,939		33,761		56,621		9.8%		14.3%
Total Assets		2,001,549		3,615,599		1,856,410		3,423,592		1,776,973		2,980,161		5.6%		21.3%
Client Deposits		918,132		1,658,513		806,420		1,487,200		705,097		1,182,519		11.5%		40.3%
Deposits And Loans From Banks		143,396		259,030		118,411		218,373		25,877		43,398		18.6%		NMF
Borrowed Funds		487,990		881,506		512,737		945,589		547,746		918,625		-6.8%		-4.0%
Issued Fixed Income Securities		2,002		3,616		1,980		3,651		405		680		-1.0%		NMF
Insurance Related Liabilities		24,341		43,970		24,076		44,401		31,114		52,182		-1.0%		-15.7%
Tax Liabilities, Current And Deferred		19,582		35,373		17,264		31,839		13,610		22,825		11.1%		55.0%
Accruals And Other Liabilities		29,908		54,025		23,197		42,780		24,696		41,418		26.3%		30.4%
Total Liabilities		1,625,350		2,936,033		1,504,085		2,773,833		1,348,546		2,261,647		5.8%		29.8%
Share Capital - Ordinary Shares		17,346		31,333		16,985		31,324		18,660		31,295		0.0%		0.1%
Share Premium		263,210		475,463		260,397		480,225		280,198		469,920		-1.0%		1.2%
Treasury Shares		(877)		(1,585)		(754)		(1,391)		(1,078)		(1,808)		13.9%		-12.3%
Revaluation And Other Reserves		25,536		46,129		27,075		49,931		13,033		21,857		-7.6%		111.0%
Retained Earnings		23,376		42,227		19,624		36,190		84,908		142,399		16.7%		-70.3%
Net Income / (Loss) For The Period		31,652		57,176		19,708		36,345		2,017		3,383		57.3%		NMF
Shareholders' Equity Excluding Minority Interest		360,243		650,743		343,034		632,624		397,738		667,046		2.9%		-2.4%
Minority Interest		15,956		28,823		9,291		17,135		30,689		51,468		68.2%		-44.0%
Total Shareholders' Equity		376,199		679,566		352,325		649,759		428,427		718,514		4.6%		-5.4%
Total Liabilities And Shareholdersâ€™ Equity		2,001,549		3,615,599		1,856,410		3,423,592		1,776,973		2,980,161		5.6%		21.3%

⁴ Change calculations based on GEL values

STANDALONE Q3 2010 INCOME STATEMENT

Period ended	Â	Q3 2010					Â	Q2 2010					Â	Q3 2009			Â	Change⁴	Â	Change⁴
Standalone, IFRS-based		US$¹	Â	GEL				US$²	Â	GEL				US$³	Â	GEL		Q-O-Q		Y-O-Y
000s Unless otherwise noted		(Unaudited)						(Unaudited)						(Unaudited)
					Â						Â
Interest Income		56,030				101,212		52,034				95,962		50,461		84,628		5.5%		19.6%
Interest Expense		26,973				48,724		25,820				47,618		23,911		40,101		2.3%		21.5%
Net Interest Income		29,057				52,489		26,214				48,344		26,550		44,527		8.6%		17.9%
Fees & Commission Income		8,065				14,569		7,078				13,052		6,176		10,358		11.6%		40.7%
Fees & Commission Expense		1,757				3,174		1,633				3,012		1,361		2,283		5.4%		39.0%
Net Fees & Commission Income		6,308				11,395		5,444				10,040		4,815		8,075		13.5%		41.1%
Income From Documentary Operations		1,595				2,882		1,401				2,584		1,668		2,798		11.5%		3.0%
Expense On Documentary Operations		267				482		260				480		286		480		0.3%		0.3%
Net Income From Documentary Operations		1,329				2,401		1,141				2,104		1,382		2,318		14.1%		3.6%
Net Foreign Currency Related Income		4,510				8,148		4,248				7,835		3,577		5,998		4.0%		35.8%
Net Other Non-Interest Income		286				517		431				795		352		590		-34.9%		-12.4%
Net Non-Interest Income		12,434				22,460		11,265				20,774		10,126		16,982		8.1%		32.3%
Total Operating Income (Revenue)		41,491				74,949		37,479				69,119		36,676		61,509		8.4%		21.9%
Personnel Costs		10,810				19,527		9,337				17,219		8,770		14,707		13.4%		32.8%
Selling, General & Administrative Expenses		3,207				5,794		3,059				5,642		3,852		6,461		2.7%		-10.3%
Procurement & Operations Support Expenses		1,719				3,105		1,417				2,614		1,503		2,521		18.8%		23.2%
Depreciation And Amortization		3,127				5,649		3,004				5,540		3,109		5,214		2.0%		8.3%
Other Operating Expenses		447				808		793				1,462		699		1,173		-44.7%		-31.1%
Total Recurring Operating Costs		19,310				34,882		17,610				32,477		17,934		30,077		7.4%		16.0%
Normalized Net Operating Income / (Loss)		22,180				40,067		19,869				36,642		18,742		31,432		9.3%		27.5%
Net Non-Recurring Income / (Costs)		(1,026)				(1,854)		(998)				(1,840)		(583)		(978)		0.8%		89.6%
Profit / (Loss) Before Provisions		21,154				38,213		18,871				34,802		18,159		30,454		9.8%		25.5%
Net Provision Expense		5,457				9,858		3,546				6,540		10,561		17,712		50.7%		-44.3%
Pre-Tax Income / (Loss)		15,697				28,355		15,325				28,262		7,598		12,743		0.3%		122.5%
Income Tax Expense / (Benefit)		2,581				4,662		2,077				3,831		1,140		1,911		21.7%		143.9%
Net Income / (Loss)		13,116				23,693		13,248				24,431		6,458		10,831		-3.0%		118.7%

⁴ Change calculations based on GEL values

STANDALONE NINE MONTHS INCOME STATEMENT

Period ended	Â	9 months 2010			Â	9 months 2009			Â	Change³
Standalone, IFRS-based		US$¹	Â	GEL		US$²	Â	GEL		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)
											Â
Interest Income		157,573		284,640		155,740		261,192		9.0%
Interest Expense		78,166		141,200		72,033		120,807		16.9%
Net Interest Income		79,407		143,440		83,707		140,384		2.2%
Fees & Commission Income		21,439		38,727		18,503		31,031		24.8%
Fees & Commission Expense		4,868		8,794		4,010		6,725		30.8%
Net Fees & Commission Income		16,571		29,933		14,493		24,306		23.2%
Income From Documentary Operations		4,452		8,042		4,691		7,867		2.2%
Expense On Documentary Operations		798		1,442		916		1,537		-6.2%
Net Income From Documentary Operations		3,654		6,600		3,774		6,330		4.3%
Net Foreign Currency Related Income		11,961		21,607		10,717		17,973		20.2%
Net Other Non-Interest Income		1,030		1,860		861		1,444		28.8%
Net Non-Interest Income		33,216		60,001		29,845		50,053		19.9%
Total Operating Income (Revenue)		112,622		203,441		113,552		190,438		6.8%
Personnel Costs		28,909		52,222		26,378		44,239		18.0%
Selling, General & Administrative Expenses		9,681		17,487		11,186		18,760		-6.8%
Procurement & Operations Support Expenses		4,743		8,569		4,661		7,817		9.6%
Depreciation And Amortization		9,236		16,684		8,670		14,541		14.7%
Other Operating Expenses		1,750		3,161		1,908		3,200		-1.2%
Total Recurring Operating Costs		54,320		98,123		52,803		88,556		10.8%
Normalized Net Operating Income / (Loss)		58,303		105,318		60,749		101,882		3.4%
Net Non-Recurring Income / (Costs)		(2,720)		(4,914)		(2,060)		(3,454)		42.3%
Profit / (Loss) Before Provisions		55,582		100,404		58,689		98,428		2.0%
Net Provision Expense		15,892		28,707		42,539		71,342		-59.8%
Pre-Tax Income / (Loss)		39,691		71,697		16,151		27,086		164.7%
Income Tax Expense / (Benefit)		5,954		10,755		2,423		4,063		164.7%
Net Income / (Loss)		33,737		60,943		13,728		23,023		164.7%

³ Change calculations based on GEL values

STANDALONE Q3 2010 BALANCE SHEET

Period ended	Â	Q3 2010			Â	Q2 2010			Â	Q3 2009			Â	Change⁴	Â	Change⁴
Standalone, IFRS-based		US$¹	Â	GEL		US$²	Â	GEL		US$³	Â	GEL		Q-O-Q		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)				(Unaudited)
																	Â
Cash And Cash Equivalents		62,116		112,205		62,198		114,706		74,866		125,557		-2.2%		-10.6%
Loans And Advances To Credit Institutions		256,555		463,440		216,326		398,949		230,290		386,219		16.2%		20.0%
Mandatory Reserves With NBG / NBU / NBRB		45,983		83,064		24,524		45,228		19,478		32,666		83.7%		154.3%
Other Accounts With NBG / NBU / NBRB		17,771		32,102		423		781		52,408		87,893		NMF		-63.5%
Balances With And Loans To Other Banks		192,801		348,275		191,379		352,940		158,404		265,660		-1.3%		31.1%
Investment Securities: HTM, Treasuries And Equivalents		164,803		297,701		145,449		268,238		21,826		36,605		11.0%		NMF
Loans To Clients, Gross		1,140,736		2,060,626		1,074,458		1,981,515		984,619		1,651,305		4.0%		24.8%
Less: Reserve For Loan Losses		(74,626)		(134,804)		(74,605)		(137,586)		(73,597)		(123,430)		-2.0%		9.2%
Loans To Clients, Net		1,066,110		1,925,822		999,853		1,843,929		911,022		1,527,875		4.4%		26.0%
Investment Property		42,743		77,210		34,125		62,932		-		-		22.7%		NMF
Investments In Other Business Entities, Net		184,194		332,728		180,333		332,570		181,484		304,367		0.0%		9.3%
Property And Equipment Owned, Net		128,124		231,444		125,472		231,396		142,965		239,767		0.0%		-3.5%
Intangible Assets Owned, Net		9,784		17,673		9,873		18,208		3,891		6,526		-2.9%		170.8%
Goodwill		12,593		22,748		12,335		22,748		13,846		23,221		0.0%		-2.0%
Tax Assets, Current And Deferred		3,652		6,597		3,591		6,622		-		-		-0.4%		NMF
Prepayments And Other Assets		18,944		34,221		17,591		32,442		21,920		36,762		5.5%		-6.9%
Total Assets		1,949,618		3,521,790		1,807,147		3,332,740		1,641,247		2,752,536		5.7%		27.9%
Client Deposits		837,240		1,512,390		727,870		1,342,338		630,570		1,057,529		12.7%		43.0%
Deposits And Loans From Banks		135,490		244,749		104,771		193,219		6,913		11,594		26.7%		NMF
Borrowed Funds		487,991		881,506		512,737		945,589		545,180		914,322		-6.8%		-3.6%
Issued Fixed Income Securities		2,002		3,616		1,980		3,651		-		-		-1.0%		NMF
Tax Liabilities, Current And Deferred		18,869		34,085		16,251		29,969		11,526		19,330		13.7%		76.3%
Accruals And Other Liabilities		16,450		29,715		11,602		21,396		12,995		21,796		38.9%		36.3%
Total Liabilities		1,498,041		2,706,061		1,375,210		2,536,163		1,207,185		2,024,571		6.7%		33.7%
Share Capital - Ordinary Shares		17,346		31,333		16,985		31,324		18,660		31,295		0.0%		0.1%
Share Premium		263,592		476,153		260,537		480,482		284,741		477,539		-0.9%		-0.3%
Treasury Shares		(778)		(1,406)		(642)		(1,184)		(890)		(1,493)		18.7%		-5.8%
Revaluation And Other Reserves		36,580		66,079		35,591		65,637		22,117		37,092		0.7%		78.1%
Retained Earnings		101,100		182,627		99,267		183,068		95,707		160,509		-0.2%		13.8%
Net Income / (Loss) For The Period		33,737		60,943		20,198		37,250		13,728		23,023		63.6%		164.7%
Total Shareholders' Equity		451,577		815,729		431,937		796,577		434,062		727,965		2.4%		12.1%
Total Liabilities And Shareholders Equity		1,949,618		3,521,790		1,807,147		3,332,740		1,641,247		2,752,536		5.7%		27.9%

⁴ Change calculations based on GEL values

BG BANK (UKRAINE) Q3 2010 INCOME STATEMENT

Period ended	Â	Q3 2010			Â	Q3 2009			Â	Change³
Standalone, IFRS-based		US$¹	Â	GEL		US$²	Â	GEL		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)
											Â
Interest Income		4,345		7,849		4,942		8,288		-5.3%
Interest Expense		3,005		5,428		2,573		4,315		25.8%
Net Interest Income		1,340		2,421		2,369		3,973		-39.1%
Fees & Commission Income		205		370		1,132		1,898		-80.5%
Fees & Commission Expense		26		47		420		704		-93.3%
Net Fees & Commission Income		178		322		712		1,194		-73.0%
Income From Documentary Operations		13		24		-		-		NMF
Expense On Documentary Operations		-		-		-		-		-
Net Income From Documentary Operations		13		24		-		-		NMF
Net Foreign Currency Related Income		128		232		50		84		174.3%
Net Other Non-Interest Income		6		10		-		-		NMF
Net Non-Interest Income		326		588		762		1,278		-54.0%
Total Operating Income (Revenue)		1,666		3,009		3,131		5,252		-42.7%
Personnel Costs		1,152		2,081		1,542		2,586		-19.5%
Selling, General & Administrative Expenses		318		575		433		727		-20.8%
Procurement & Operations Support Expenses		230		415		110		185		124.0%
Depreciation And Amortization		144		260		177		297		-12.4%
Other Operating Expenses		(33)		(60)		81		136		NMF
Total Recurring Operating Costs		1,811		3,271		2,344		3,931		-16.8%
Normalized Net Operating Income / (Loss)		(145)		(262)		788		1,321		NMF
Net Non-Recurring Income / (Costs)		60		108		3		6		NMF
Profit / (Loss) Before Provisions		(85)		(153)		791		1,327		NMF
Net Provision Expense		2,113		3,818		7,698		12,910		-70.4%
Pre-Tax Income / (Loss)		(2,198)		(3,971)		(6,907)		(11,584)		-65.7%
Income Tax Expense / (Benefit)		(475)		(858)		(3,612)		(6,058)		-85.8%
Net Income / (Loss)		(1,723)		(3,113)		(3,295)		(5,526)		-43.7%

³ Change calculations based on GEL values

BG BANK (UKRAINE) NINE MONTHS INCOME STATEMENT

Period ended	Â	9 months 2010			Â	9 months 2009			Â	Change³
Standalone, IFRS-based		US$¹	Â	GEL		US$²	Â	GEL		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)
											Â
Interest Income		12,800		23,122		17,017		28,539		-19.0%
Interest Expense		7,850		14,181		10,356		17,368		-18.4%
Net Interest Income		4,950		8,941		6,661		11,171		-20.0%
Fees & Commission Income		755		1,364		2,264		3,797		-64.1%
Fees & Commission Expense		237		428		674		1,130		-62.1%
Net Fees & Commission Income		518		936		1,590		2,666		-64.9%
Income From Documentary Operations		70		126		-		-		NMF
Expense On Documentary Operations		-		-		-		-		-
Net Income From Documentary Operations		70		126		-		-		NMF
Net Foreign Currency Related Income		193		349		1,470		2,466		-85.8%
Net Other Non-Interest Income		15		28		-		-		NMF
Net Non-Interest Income		796		1,439		3,060		5,132		-72.0%
Total Operating Income (Revenue)		5,746		10,380		9,721		16,303		-36.3%
Personnel Costs		4,159		7,513		5,401		9,057		-17.0%
Selling, General & Administrative Expenses		1,037		1,873		1,500		2,515		-25.5%
Procurement & Operations Support Expenses		690		1,247		755		1,267		-1.6%
Depreciation And Amortization		342		619		467		784		-21.1%
Other Operating Expenses		473		854		327		549		55.6%
Total Recurring Operating Costs		6,702		12,106		8,450		14,172		-14.6%
Normalized Net Operating Income / (Loss)		(956)		(1,726)		1,271		2,132		NMF
Net Non-Recurring Income / (Costs)		36		65		(200)		(336)		NMF
Profit / (Loss) Before Provisions		(920)		(1,661)		1,071		1,795		NMF
Net Provision Expense		2,331		4,211		19,866		33,317		-87.4%
Pre-Tax Income / (Loss)		(3,251)		(5,872)		(18,796)		(31,522)		-81.4%
Income Tax Expense / (Benefit)		(738)		(1,333)		(4,699)		(7,881)		-83.1%
Net Income / (Loss)		(2,513)		(4,539)		(14,097)		(23,642)		-80.8%

³ Change calculations based on GEL values

BNB (BELARUS) Q3 2010 INCOME STATEMENT

Period ended	Â	Q3 2010			Â	Q3 2009			Â	Change³
Standalone, IFRS-based		US$¹	Â	GEL		US$²	Â	GEL		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)
											Â
Interest Income		1,342		2,424		1,179		1,977		22.6%
Interest Expense		130		235		321		538		-56.3%
Net Interest Income		1,212		2,189		858		1,439		52.1%
Fees & Commission Income		276		499		281		471		6.0%
Fees & Commission Expense		66		119		38		63		89.1%
Net Fees & Commission Income		210		380		243		408		-6.8%
Income From Documentary Operations		19		34		-		1		NMF
Expense On Documentary Operations		4		8		-		-		NMF
Net Income From Documentary Operations		14		26		-		1		NMF
Net Foreign Currency Related Income		292		527		164		276		91.2%
Net Other Non-Interest Income		19		34		(14)		(24)		NMF
Net Non-Interest Income		535		967		394		660		46.4%
Total Operating Income (Revenue)		1,747		3,156		1,252		2,100		50.3%
Personnel Costs		797		1,439		440		738		95.0%
Selling, General & Administrative Expenses		179		324		114		191		69.9%
Procurement & Operations Support Expenses		176		318		148		249		27.7%
Depreciation And Amortization		100		181		48		80		126.5%
Other Operating Expenses		131		236		115		193		22.5%
Total Recurring Operating Costs		1,383		2,498		865		1,450		72.2%
Normalized Net Operating Income / (Loss)		364		658		387		649		1.3%
Net Non-Recurring Income / (Costs)		177		319		31		52		NMF
Profit / (Loss) Before Provisions		541		977		418		701		39.3%
Net Provision Expense		18		32		(103)		(173)		NMF
Pre-Tax Income / (Loss)		523		945		521		874		8.1%
Income Tax Expense / (Benefit)		99		179		153		257		-30.4%
Net Income / (Loss)		424		766		368		617		24.1%

³ Change calculations based on GEL values

BNB (BELARUS) NINE MONTHS INCOME STATEMENT

Period ended	Â	9 months 2010			Â	9 months 2009			Â	Change³
Standalone, IFRS-based		US$¹	Â	GEL		US$²	Â	GEL		Y-O-Y
000s Unless otherwise noted		(Unaudited)				(Unaudited)
											Â
Interest Income		4,191		7,570		2,997		5,026		50.6%
Interest Expense		409		738		979		1,642		-55.0%
Net Interest Income		3,782		6,832		2,018		3,385		101.8%
Fees & Commission Income		699		1,263		723		1,212		4.2%
Fees & Commission Expense		142		257		101		170		51.2%
Net Fees & Commission Income		557		1,006		621		1,042		-3.5%
Income From Documentary Operations		34		61		2		4		NMF
Expense On Documentary Operations		4		8		1		1		NMF
Net Income From Documentary Operations		29		53		2		3		NMF
Net Foreign Currency Related Income		596		1,077		1,034		1,735		-37.9%
Net Other Non-Interest Income		42		75		47		78		-4.3%
Net Non-Interest Income		1,224		2,211		1,704		2,858		-22.6%
Total Operating Income (Revenue)		5,006		9,043		3,722		6,243		44.9%
Personnel Costs		1,986		3,588		1,351		2,266		58.3%
Selling, General & Administrative Expenses		429		775		301		505		53.4%
Procurement & Operations Support Expenses		462		835		427		716		16.6%
Depreciation And Amortization		247		446		229		384		16.1%
Other Operating Expenses		346		625		323		542		15.4%
Total Recurring Operating Costs		3,470		6,269		2,632		4,414		42.0%
Normalized Net Operating Income / (Loss)		1,536		2,774		1,091		1,829		51.7%
Net Non-Recurring Income / (Costs)		170		307		42		71		NMF
Profit / (Loss) Before Provisions		1,706		3,081		1,133		1,900		62.1%
Net Provision Expense		381		689		(103)		(172)		NMF
Pre-Tax Income / (Loss)		1,324		2,392		1,236		2,072		15.4%
Income Tax Expense / (Benefit)		286		516		356		598		-13.7%
Net Income / (Loss)		1,039		1,876		879		1,475		27.2%

³ Change calculations based on GEL values

KEY RATIOS

	Â	Q3 2010	Â	Q2 2010	Â	Q3 2009
Profitability Ratios	Â	Â	Â	Â	Â	Â
ROAA¹, Annualized	Â	2.4%	Â	2.4%	Â	0.4%
ROAE², Annualized	Â	12.5%	Â	12.5%	Â	1.5%
ROA, Annualized	Â	2.3%	Â	2.3%	Â	0.4%
ROE, Annualized	Â	12.3%	Â	12.1%	Â	1.5%
Interest Income / Average Int. Earning Assets Excl. Cash, Annualized³	Â	19.3%	Â	19.5%	Â	21.1%
Interest Income / Average Int. Earning Assets Incl. Cash, Annualized³	Â	16.1%	Â	16.8%	Â	17.5%
Cost Of Funds ⁴, Annualied	Â	7.9%	Â	8.4%	Â	8.5%
Net Spread Excl. Cash, Annualized ⁵	Â	11.4%	Â	11.1%	Â	12.7%
Net Spread Incl. Cash, Annualized ⁵	Â	8.2%	Â	8.4%	Â	9.1%
Net Interest Margin ⁶, Annualised	Â	8.2%	Â	8.3%	Â	9.1%
Loan Yield Excl. Provisions⁷, Annualised	Â	20.0%	Â	20.2%	Â	20.1%
Loan Yield Incl. Provisions⁷, Annualised	Â	17.4%	Â	17.8%	Â	13.6%
Deposit Yield, Annualised	Â	8.8%	Â	9.1%	Â	9.6%
Interest Expense To Interest Income	Â	48.8%	Â	50.5%	Â	47.8%
Net Non-Interest Income To Average Total Assets, Annualised	Â	3.9%	Â	3.8%	Â	4.1%
Net Non-Interest Income To Revenue ⁸	Â	38.0%	Â	37.4%	Â	38.3%
Net Fee And Commission Income To Average Interest Earning Assets ⁹, Annualised	Â	2.0%	Â	1.7%	Â	2.3%
Net Fee And Commission Income To Revenue	Â	15.1%	Â	13.2%	Â	15.2%
Operating Leverage, Y-O-Y ¹⁰	Â	2.6%	Â	3.1%	Â	2.6%
Operating Leverage, Y-O-Y, Normalized ¹⁰	Â	1.5%	Â	-0.8%	Â	-
Operating Leverage, Consecutive Q-O-Q ¹⁰	Â	-3.3%	Â	15.3%	Â	-2.1%
Operating Leverage, Consecutive Q-O-Q, Normalized ¹⁰	Â	3.7%	Â	5.5%	Â	1.4%
Total Operating Income (Revenue) To Total Assets, Annualised	Â	10.1%	Â	9.6%	Â	10.6%
Recurring Earning Power ¹¹, Annualised	Â	4.4%	Â	4.4%	Â	4.4%
Net Income To Revenue	Â	22.8%	Â	23.7%	Â	3.3%
Â	Â	Â	Â	Â	Â	Â
Efficiency Ratios	Â	Â	Â	Â	Â	Â
Operating Cost To Average Total Assets ¹², Annualised	Â	5.8%	Â	5.9%	Â	6.1%
Cost To Average Total Assets ¹³, Annualised	Â	6.0%	Â	5.7%	Â	6.3%
Cost / Income ¹⁴	Â	57.8%	Â	56.1%	Â	59.1%
Cost / Income, Normalized ¹⁵	Â	56.0%	Â	57.9%	Â	56.7%
Cash Cost / Income	Â	42.0%	Â	43.9%	Â	43.0%
Total Employee Compensation Expense To Revenue ¹⁶	Â	29.6%	Â	31.4%	Â	28.1%
Total Employee Compensation Expense To Cost	Â	51.2%	Â	56.0%	Â	47.6%
Total Employee Compensation Expense To Average Total Assets, Annualised	Â	3.0%	Â	3.2%	Â	3.0%

Liquidity Ratios	Â	Â	Â	Â	Â	Â
Net Loans To Total Assets ¹⁷		57.0%		57.9%		55.7%
Average Net Loans To Average Total Assets		57.1%		57.6%		58.0%
Interest Earning Assets To Total Assets		78.5%		76.9%		72.0%
Average Interest Earning Assets To Average Total Assets		77.6%		76.3%		72.4%
Liquid Assets To Total Assets ¹⁸		25.6%		24.3%		22.9%
Liquid Assets To Total Short-Term Liabilities, NBG Stand-Alone		33.8%		34.8%		43.5%
Liquid Assets To Total Liabilities, IFRS Consolidated		31.6%		30.0%		30.2%
Net Loans To Client Deposits		124.3%		133.3%		140.3%
Average Net Loans To Average Client Deposits		128.2%		131.1%		155.0%
Net Loans To Total Deposits ¹⁹		107.5%		116.2%		135.4%
Net Loans To (Total Deposits + Equity)		79.4%		84.2%		85.3%
Net Loans To Total Liabilities		70.2%		71.5%		73.4%
Total Deposits To Total Liabilities		65.3%		61.5%		54.2%
Client Deposits To Total Deposits		86.5%		87.2%		96.5%
Client Deposits To Total Liabilties		56.5%		53.6%		52.3%
Current Account Balances To Client Deposits		43.0%		44.2%		44.9%
Demand Deposits To Client Deposits	Â	10.6%	Â	9.0%	Â	9.2%
Time Deposits To Client Deposits	Â	46.4%	Â	46.7%	Â	45.9%
Total Deposits To Total Assets	Â	53.0%	Â	49.8%	Â	41.1%
Client Deposits To Total Assets	Â	45.9%	Â	43.4%	Â	39.7%
Client Deposits To Total Equity (Times) ²⁰	Â	2.44	Â	2.29	Â	1.65
Due From Banks / Due To Banks ²¹	Â	185.4%	Â	174.5%	Â	882.6%
Total Equity To Net Loans	Â	33.0%	Â	32.8%	Â	43.3%
Leverage (Times) ²²	Â	4.3	Â	4.3	Â	3.1
Asset Quality	Â	Â	Â	Â	Â	Â
NPLs (in GEL) ²³	Â	131,506	Â	173,743	Â	139,959
NPLs To Gross Loans To Clients ²⁴	Â	5.9%	Â	8.0%	Â	7.7%
NPL Coverage Ratio ²⁵	Â	141.4%	Â	113.5%	Â	118.8%
Cost of Risk ²⁶, Annualized	Â	2.6%	Â	2.4%	Â	6.4%
Reserve For Loan Losses To Gross Loans To Clients ²⁷	Â	8.3%	Â	9.0%	Â	9.1%
% Of Loans To Clients Collateralized	Â	91.6%	Â	91.0%	Â	89.4%
Equity To Average Net Loans To Clients	Â	36.4%	Â	36.1%	Â	49.8%
Capital Adequacy:	Â	Â	Â	Â	Â	Â
Equity To Total Assets	Â	18.8%	Â	19.0%	Â	24.1%
BIS Tier I Capital Adequacy Ratio, Consolidated ²⁸	Â	19.9%	Â	20.0%	Â	25.0%
BIS Total Capital Adequacy Ratio, Consolidated ²⁹	Â	32.6%	Â	33.1%	Â	36.4%
BIS Tier I Capital Adequacy Ratio, Stand-alone ²⁸	Â	24.7%	Â	25.2%	Â	27.5%
BIS Total Capital Adequacy Ratio, Stand-alone ²⁹	Â	31.2%	Â	32.3%	Â	33.4%
NBG Tier I Capital Adequacy Ratio ³⁰	Â	15.2%	Â	15.8%	Â	20.4%
NBG Total Capital Adequacy Ratio ³¹	Â	15.7%	Â	14.5%	Â	21.2%
Per Share Values:	Â	Â	Â	Â	Â	Â
Basic EPS (GEL) ³²	Â	0.66	Â	0.63	Â	0.08
Basic EPS (US$)	Â	$0.37	Â	$0.34	Â	($0.05)
Fully Diluted EPS (GEL) ³³	Â	0.60	Â	0.56	Â	0.08
Fully Diluted EPS (US$)	Â	$0.33	Â	$0.31	Â	($0.05)
Book Value Per Share (GEL) ³⁴	Â	21.69	Â	20.74	Â	22.96
Book Value Per Share (US$)	Â	$12.01	Â	$11.25	Â	$13.69
Ordinary Shares Outstanding - Weighted Average, Basic	Â	31,333,253	Â	31,321,662	Â	31,294,603
Ordinary Shares Outstanding - Period End	Â	31,333,253	Â	31,324,466	Â	31,294,603
Ordinary Shares Outstanding - Fully Diluted	Â	34,807,867	Â	34,796,276	Â	34,769,217
Selected Operating Data:	Â	Â	Â	Â	Â	Â
Full Time Employees, Group	Â	5,313	Â	5,118	Â	4,798
Full Time Employees, BOG Stand-Alone	Â	3,060	Â	2,963	Â	2,669
Total Assets Per FTE ³⁵	Â	680.52	Â	668.93	Â	621.13
Total Assets Per FTE, BOG Stand-Alone	Â	1,150.91	Â	1,124.79	Â	1,031.30
Number Of Active Branches	Â	137	Â	137	Â	140
Number Of ATMs	Â	388	Â	387	Â	380
Number Of Cards Outstanding	Â	565,393	Â	551,741	Â	569,766
Number Of POS Terminals	Â	2,280	Â	2,225	Â	1,892

NOTES TO KEY RATIOS

1	Â	Return On Average Total Assets (ROAA) equals Net Income of the period divided by quarterly Average Total Assets for the same period;
2		Return On Average Total Equity (ROAE) equals Net Income of the period divided by quarterly Average Total Equity for the same period;
3		Average Interest Earning Assets are calculated on a quarterly basis; Interest Earning Assets include: Loans And Advances To Credit Institutions, Treasuries And Equivalents, Other Fixed Income Instruments and Net Loans to Clients;
4		Cost Of Funds equals Interest Expense of the period divided by quarterly Average Interest Bearing Liabilities; Interest Bearing Liabilities Include: Client Deposits, Deposits And Loans From Banks, Borrowed Funds and Issued Fixed Income Securities;
5		Net Spread equals Interest Income To Average Interest Earning Assets less Cost Of Funds;
6		Net Interest Margin equals Net Interest Income of the period divided by quarterly Average Interest Earning Assets of the same period;
7		Loan Yield equals Interest Income, less Net Provision Expense, divided by quarterly Average Gross Loans To Clients;
8		Revenue equals Total Operating Income;
9		Net Fee And Commission Income includes Net Income From Documentary Operations of the period ;
10		Operating Leverage equals percentage change in Revenue less percentage change in Total Costs;
11		Recurring Earning Power equals Profit Before Provisions of the period divided by average Total Assets of the same period;
12		Operating Cost equals Total Recurring Operating Costs;
13		Cost includes Total Recurring Operating Costs and Net Non-Recurring Costs (Income);
14		Cost/Income Ratio equals Costs of the period divided by Total Operating Income (Revenue);
15		Cost/Income Normalized equals Total Recurring Operating cost (excludes net non-recurring costs) divided by total operating income.
16		Total Employee Compensation Expense includes Personnel Costs;
17		Net Loans equal Net Loans To Clients;
18		Liquid Assets include: Cash And Cash Equivalents, Other Accounts With NBG, Balances With And Loans To Other Banks, Treasuries And Equivalents and Other Fixed Income Securities as of the period end and are divided by Total Assets as of the same date;
19		Total Deposits include Client Deposits and Deposits And Loans from Banks;
20		Total Equity equals Total Shareholdersâ€™ Equity;
21		Due From Banks/ Due To Banks equals Loans And Advances To Credit Institutions divided by Deposits And Loans From Banks;
22		Leverage (Times) equals Total Liabilities as of the period end divided by Total Equity as of the same date;
23		NPLs (in GEL) equals total gross non-performing loans as of the period end; non-performing loans are loans that have debts in arrears for more than 90 calendar days;
24		Gross Loans equals Gross Loans To Clients;
25		NPL Coverage Ratio equals Reserve For Loan losses as of the period end divided by NPLs as of the same date;
26		Cost Of Risk equals Net Provision For Loan Losses of the period, plus provisions for (less recovery of) other assets, divided by quarterly average Gross Loans To Clients over the same period;
27		Reserve For Loan Losses To Gross Loans To Clients equals reserve for loan losses as of the period end divided by gross loans to clients as of the same date;
28		BIS Tier I Capital Adequacy Ratio equals Tier I Capital as of the period end divided by Total Risk Weighted Assets as of the same date, both calculated in accordance with the requirements of Basel Accord I;
29		BIS Total Capital Adequacy Ratio equals Total Capital as of the period end divided by Total Risk Weighted Assets as of the same date, both calculated in accordance with the requirements of Basel Accord I;
30		NBG Tier I Capital Adequacy Ratio equals Tier I Capital as of the period end divided by Total Risk Weighted Assets as of the same date, both calculated in accordance with the requirements the National Bank of Georgia;
31		NBG Total Capital Adequacy Ratio equals Total Capital as of the period end divided by Total Risk Weighted Assets as of the same date, both calculated in accordance with the requirements of the National Bank of Georgia;
32		Basic EPS equals Net Income of the period divided by the weighted average number of outstanding ordinary shares over the same period;
33		Fully Diluted EPS equals net income of the period divided by the number of outstanding ordinary shares as of the period end plus number of ordinary shares in contingent liabilities;
34		Book Value Per Share equals Equity as of the period end, plus Treasury Shares, divided by the total number of Outstanding Ordinary shares as of the same date
35		Equals total consolidated assets divided by total number of full-time employees

About Bank of Georgia

Bank of Georgia is the leading Georgian bank offering a broad range of corporate banking, retail banking, wealth management, brokerage and insurance services to its clients in Georgia, Ukraine and Belarus. Bank of Georgia is the largest bank in Georgia by assets, loans, deposits and equity, with 34.2% market share by total assets (all data according to the NBG as of 30 September 2010). The bank has 137 branches and more than one million retail and 171,052 corporate current accounts.

Bank of Georgia has, as of the date hereof, the following credit ratings:

Standard & Poorâ€™s	Â	â€˜B/Bâ€™
FitchRatings		â€˜B+/Bâ€™
Moodyâ€™s		â€˜B3/NPâ€™ (FC) & â€˜Ba3/NPâ€™ (LC)

For further information, please visit www.bog.ge/ir or contact:

Irakli Gilauri	Â	Giorgi Chiladze	Â	Macca Ekizashvili
Chief Executive Officer		Deputy CEO, Finance		Head of Investor Relations
+995 32 444 109		+995 32 444 249		+995 32 444 256
igilauri@bog.ge		gchiladze@bog.ge		ir@bog.ge

This news report is presented for general informational purposes only and should not be construed as an offer to sell or the solicitation of an offer to buy any securities. Certain statements in this news report are forward-looking statements and, as such, are based on the managementâ€™s current expectations and are subject to uncertainty and changes in circumstances.

The financial information as of Q3 2009, Q2 2010 and Q3 2010 contained in this news report is unaudited,Â derived from IFRS-based management reportsÂ and reflects the best estimates of management. Q2 2010 Consolidated numbers have been reviewd. The Bankâ€™sÂ actual results may differ from the amounts reflected herein as a result of various factors

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