Strategic Report Strategic Report Strategic Report Financial Additional Overview Strategy Performance Governance Statements Information Notes to Consolidated Financial Statements Thousands of Georgian Lari 1. Principal Activities Bank of Georgia Group PLC (“BOGG”) is a public limited liability company incorporated in England and Wales with registered number 10917019. BOGG holds 99.55% of the share capital of JSC Bank of Georgia (the “Bank”) as at 31 December 2018, representing the Bank’s ultimate parent company. Together with the Bank and other subsidiaries, the Group makes up a group of companies (the “Group”) and provides banking, leasing, brokerage and investment management services to corporate and individual customers. The shares of BOGG (“BOGG Shares”) are admitted to the premium listing segment of the Official List of the UK Listing Authority and admitted to trading on the London Stock Exchange PLC’s Main Market for listed securities, effective 21 May 2018. The Bank is the Group’s main operating unit and accounts for most of the Group’s activities. JSC Bank of Georgia was established on 21 October 1994 as a joint stock company (“JSC”) under the laws of Georgia. The Bank operates under a general banking license issued by the National Bank of Georgia (“NBG”; the Central Bank of Georgia) on 15 December 1994. The Bank accepts deposits from the public and extends credit, transfers payments in Georgia and internationally and exchanges currencies. Its main office is in Tbilisi, Georgia. At 31 December 2018, the Bank has 276 operating outlets in all major cities of Georgia (31 December 2017: 286, 31 December 2016: 278). The Bank’s registered legal address is 29a Gagarini Street, Tbilisi 0160, Georgia. On 3 July 2017 BGEO Group PLC, (“BGEO”), former ultimate holding company of the Group, announced its intention to demerge BGEO Group PLC into a London-listed banking business (the “Banking Business”), Bank of Georgia Group PLC, and a London-listed investment business (the “Investment Business”), Georgia Capital PLC. As part of the Demerger, Bank of Georgia Group PLC was incorporated and on 18 May 2018 issued 39,384,712 ordinary shares in exchange for the entire issued capital of BGEO Group PLC and became the parent company of BGEO. On 29 May 2018 the Demerger (“Demerger”) of the Group’s investment business (“Investment Business”) to Georgia Capital PLC (“GCAP”) become effective. As a result of the Demerger, the Group distributed the investments in the Investment Business with a fair value of GEL 1,441,552 to the shareholders of the Company. In addition, BOGG has issued a further 9,784,716 BOGG Shares (the “Consideration Shares”, equivalent to 19.9% of BOGG’s issued ordinary share capital) to GCAP in consideration for the transfer to BOGG by GCAP of GCAP’s stake in the JSC Bank of Georgia and JSC BG Financial. As set out in the BOGG prospectus dated 26 March 2018, for as long as GCAP’s percentage holding in BOGG is greater than 9.9%, GCAP will exercise its voting rights at BOGG general meetings in accordance with the votes cast by all other BOGG shareholders on BOGG votes at general meetings. BOGG’s registered legal address is 84 Brook Street, London, W1K 5EH, England. As at 31 December 2018, 31 December 2017 and 31 December 2016, the following shareholders owned more than 2.5% of the total outstanding shares of BOGG. Other shareholders individually owned less than 2.5% of the outstanding shares. 31 December 31 December 31 December Shareholder 2018 2017 2016 JSC Georgia Capital 19.90% – – Harding Loevner Management LP 4.66% 8.32% 9.63% JP Morgan Asset Management 3.01% 2.34% 2.79% Norges Bank Investment Management 2.56% 3.11% 2.31% Others 69.87% 86.23% 85.27% Total* 100.00% 100.00% 100.00% *For the purposes of calculating percentage of shareholding, the denominator includes total number of issued shares, which includes shares held in the trust for the share-based compensation purposes of the Group. Annual Report 2018Bank of Georgia Group PLC 177