Bank of Georgia Group PLC (the “Company”) may by ordinary resolution declare dividends provided that no such dividend shall exceed the amount recommended by the Company’s Directors. The Directors may also pay such interim dividends as appear to be justified by the profits of the Group available for distribution.

As Bank of Georgia Group PLC is a holding company, the Group relies primarily on dividends and other statutorily (if any) and contractually permissible payments from its subsidiaries to generate the funds necessary to meet its obligations and pay dividends to its shareholders.

In the first quarter of 2020, the Group took an upfront general provision of c.GEL 400 million for the full economic cycle under JSC Bank of Georgia’s (the Bank) local accounting basis, in line with the Bank’s regulator’s, the National Bank of Georgia’s (the NBG) updated supervisory plan in response to the pandemic. In addition, the NBG has also allowed banks to use the Pillar 2 and conservation buffers. The Bank’s capital adequacy ratios were affected by the upfront general provision, but have remained comfortably above minimum regulatory requirements as a result of the Bank’s strong internal capital generation. During the period that banks are allowed to partially or fully use the released capital buffers, banks cannot distribute capital in any form. As a result, the Board of Directors was not able to recommend a dividend for 2020. The Group is currently working with the NBG to agree a new schedule to rebuild the released capital buffers and return to pre-COVID capital requirements, a process that the Group hopes will be completed in June 2020. As this process concludes, the Group hopes to be in a strong position to consider paying a dividend from 2021 earnings.