TRACK RECORD 01 | CAPITAL MARKETS 2005-2013 GEORGIA
Bank of Georgia: Capital Raising Under Crisis.
Key Metrics
Total Raised$2.3 BILLION
$240 million (IFC, EBRD, OPIC)
2008 Emergency Package External Funding Package7% → 45%
Market Share18% → 37%
Market position#2 → #1
The Situation
I joined Bank of Georgia in 2005 when it was the second-ranked bank in the market, with external funding representing just 7% of its liabilities. Over eight years I led its capital raising program across every instrument type available, including Eurobonds, syndicated loans, subordinated and convertible debt, equity and structured instruments. In August 2008, Russia invaded Georgia. Simultaneously, the global financial crisis hit and the Georgian lari devalued. The bank needed capital immediately.
My Role
Two months before the war, I closed a $140 million private placement with JPMorgan. That capital proved critical when the crisis arrived. When market panic drove the bank’s own bonds and the JPMorgan placement to steep discounts, we made a deliberate call: use the liquidity buffer not only to stabilise the bank but to buy back our own paper and in doing so, removed distressed sellers from the market, steadied our securities’ price, and generated a significant return in the process. Most institutions in that position protect the cash. We used it. When Russia invaded Georgia in August 2008, the global financial crisis was simultaneously live and the Georgian lari was devaluing. I immediately initiated an emergency financing process with three major IFIs simultaneously – IFC, EBRD and OPIC. I relocated to London for a month together with the CEO and chief counsel, working across three time zones every day until the package closed. The technical challenge was substantial: the loans included a convertibility feature that could make IFIs shareholders in an LSE-listed bank – something they had no precedent for. We had to convince, educate and work through the structural and governance implications with three major institutions simultaneously while the crisis was live.
The Result
The $240 million package closed. The bank was stabilised. The package provided security across the entire Georgian banking sector and prevented a systemic crisis. Across eight years the full record spans 48 transactions totaling $2.3 billion. Most were firsts in Georgia: the first Eurobond ever issued by any Georgian entity – ahead of the sovereign – one of the first two near-simultaneous main market listings from the entire former Soviet Union, and the first subordinated financing, convertible debt and credit-linked notes in the Georgian market. The bank opened international capital markets to Georgian issuers and set the template the sovereign and others followed.
“This was an entirely new experience for all of us, including the IFIs. The London listing meant they could not get the terms they were accustomed to and they initially read that as our negotiating position rather than a structural reality. Half the work was not raising the money. It was convincing three institutions simultaneously that the constraints were real. Because the $240 million was not just about the bank. If we had failed, the whole Georgian banking system was exposed. That is the weight you carry into those rooms and that is why we did not stop until it closed.”
Track Record
Four transaction examples: Each one different in sector, structure and conditions.
Together they represent the range of work I have done and the standard I hold myself to.