Finance
IMF Flags Lending and Currency Risks in Georgia 2026 Article IV Assessment
April 23, 2026
4
Min
The International Monetary Fund has concluded its 2026 Article IV consultation mission to Georgia with a mixed assessment, praising the country's strong growth momentum while flagging emerging risks in the banking sector. The staff concluding statement, published on April 7, calls on authorities to continue monitoring fast-growing lending, foreign currency exposure, real estate financing, and digital asset activity.
Georgia's economy posted 8.4 percent real GDP growth in January-February 2026, up from 7.5 percent for full-year 2025. The IMF projects growth will ease to 5.3 percent for the full year before converging to a potential rate of approximately 5 percent over the medium term. These figures place Georgia among the fastest-growing economies in Europe and Central Asia.
However, the Fund's cautionary notes on financial sector risks reflect concerns about the sustainability of the lending boom that has accompanied Georgia's economic expansion. Credit growth has been particularly strong in real estate and consumer lending, sectors that are vulnerable to economic downturns. The IMF highlighted foreign currency exposure as a particular concern, given that a significant share of Georgian bank lending is denominated in US dollars while borrowers earn income in Georgian lari.
The Article IV statement also breaks new ground by specifically mentioning digital asset activity as a risk factor for the banking system — the first time the IMF has highlighted cryptocurrency-related risks in a Georgia assessment. The country has become a significant hub for cryptocurrency mining and trading, and regulators have been working to develop an appropriate supervisory framework.
On the fiscal front, the IMF noted that growth momentum remained firm but warned that convergence to potential GDP means the economy's capacity to absorb shocks will diminish. The Fund recommended that authorities build fiscal buffers during the current growth phase and strengthen the macro-prudential toolkit to address potential systemic risks from concentrated exposures.
Georgian banking officials have responded positively to the assessment, noting that the National Bank has already implemented tighter capital requirements and loan-to-value ratios for foreign currency mortgages.
