Strategic Report Strategic Report Strategic Report Financial Additional Overview Strategy Performance Governance Statements Information Retail Banking performance indicators Our Retail Banking business continues to deliver solid growth as we further develop our strategy towards continuous digitalisation, as demonstrated by the following performance indicators: Change Volume information in GEL thousands 2018 2017 y-o-y Retail Banking customers Number of new customers 202,386 198,488 2.0% Number of customers 2,440,754 2,315,038 5.4% Cards Number of cards issued 833,807 1,022,283 -18.4% Number of cards outstanding 2,177,273 2,227,000 -2.2% Express Pay terminals Number of Express Pay terminals 3,115 2,842 9.6% Number of transactions via Express Pay terminals 108,240,230104,021,767 4.1% Volume of transactions via Express Pay terminals 6,741,247 4,748,036 42.0% POS terminals Number of desks 10,009 9,934 0.8% Number of contracted merchants 6,575 5,341 23.1% Number of POS terminals 14,220 13,291 7.0% Number of transactions via POS terminals 62,110,165 46,177,412 34.5% Volume of transactions via POS terminals 1,937,392 1,405,800 37.8% Internet banking Number of active users 295,226 219,496 34.5% Number of transactions via internet bank (iBank) 5,892,493 6,415,427 -8.2% Volume of transactions via internet bank (iBank) 2,029,599 1,402,969 44.7% Mobile banking Number of active users 333,698 177,243 88.3% Number of transactions via mobile bank (mBank) 15,676,447 6,348,533 146.9% Volume of transactions via mobile Bank (mBank) 1,961,108 685,470 186.1% •Growth in the client base was due to the increased offering of cost-effective remote channels. The increase to 2,440,754 customers in 2018 (up 5.4% y-o-y) reflects the sustained growth in our client base over recent periods and was one of the drivers of the increase in our Retail Banking net fee and commission income. •The number of outstanding cards decreased by 2.2% y-o-y in 2018 due to Express cards which have been declining in line with the recently introduced regulations on consumer lending. Excluding the Express cards, total number of cards outstanding at 31 December 2018 increased by 30.4% y-o-y. Loyalty programme Plus+ cards launched in July 2017 as part of RB’s client-centric approach, more than doubled y-o-y. We had 592,458 active Plus+ cards outstanding as at 31 December 2018. •In November 2018, in order to extend the scale of its payment system, Bank of Georgia was licensed to offer its services to the JCB cards users throughthe Bank’s terminals and ATMs. Inclusion of JCB cards in Bank of Georgia’s payment services opens up access to around 117 million people from 190 countries. JCB is an international payment brand originating from Japan and given the increasing number of tourists from Asia in Georgia (visitors from Asia increased at an impressive CAGR of 56.3% over 2014-2018, reaching up to 8% of total international visitors in Georgia in 2018), Bank of Georgia is well equipped to offer them best-in-class services. •Utilisation of Express Pay terminals continued to grow in 2018.The volume of transactions increased to GEL 6,741.2 million in 2018 (up 42.0% y-o-y). The number of transactions increased by 4.1% y-o-y in 2018. The fees charged to clients for transactions executed through Express Pay terminals amounted to GEL 22.0 million in 2018 (up 6.8% y-o-y). •Digital penetration growth. For our mobile banking application, the number of transactions (up 146.9% y-o-y) and the volume of transactions (up 186.1% y-o-y) continue to show outstanding growth. The fully-transformed, user- friendly, multi-feature mobile banking application (mBank) continues to gain popularity. Since its launch on 29 May 2017, 595,541 downloads have been made by the Bank’s customers. During the same period approximately 19.3 million online transactions were performed using the application. Annual Report 2018Bank of Georgia Group PLC 97