## Georgia: Technical Assistance Report-Operationalizing the New Bank Recovery and Resolution Framework

_IMF Staff Country Reports, January 10, 2023_

## Source details

**Canonical URL:** [Georgia: Technical Assistance Report-Operationalizing the New Bank Recovery and Resolution Framework](https://www.imf.org/en/publications/cr/issues/2023/01/10/georgia-technical-assistance-report-operationalizing-the-new-bank-recovery-and-resolution-528030)

## Other formats

- [Markdown version](/en/publications/cr/issues/2023/01/10/georgia-technical-assistance-report-operationalizing-the-new-bank-recovery-and-resolution-528030/index.md)
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## Bibliographic details
- Published: January 10, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400230097.002

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### Overview
- Purpose: Operationalize Georgia’s new bank recovery, resolution, and crisis management frameworks.
- Context: Georgian authorities indicated interest in operationalizing their recovery, resolution, and crisis management frameworks.
- Progress noted: Georgia has made considerable progress in developing the infrastructure needed for an effective bank recovery and resolution regime.

### Key findings and analysis
- Temporary public funding arrangements:
  - The report highlights the need to analyze alternatives to the current temporary public funding arrangements.
  - Emphasis on assessing the scope to deploy all such funding through the Resolution Fund.
  - Consideration of the potential use—subject to strict safeguards—of the deposit insurance fund to finance resolution actions.
- Escalation process weaknesses:
  - The current escalation process from going-concern to gone-concern does not provide the supervisors with sufficient and adequate triggers to mitigate risks at a sufficiently early stage.
  - The mission recommends clarifying Article 30 of the Banking Law, which explicitly mentions only the temporary administrator as early intervention measures.
- Institutional capacity:
  - A key recommendation of the mission is to strengthen the National Bank of Georgia’s resolution function.
- Contingency planning:
  - The mission provided guidance on the general architecture of intra- and interagency contingency plans, which serve as the building blocks for a national financial crisis preparedness plan.

### Policy recommendations and operational guidance
- Analyze alternatives to current temporary public funding arrangements, including:
  - Deploying all temporary public funding through the Resolution Fund.
  - Potential, conditional use of the deposit insurance fund for financing resolution actions (subject to strict safeguards).
- Clarify legal provisions:
  - Amend or clarify Article 30 of the Banking Law to expand or specify early intervention measures beyond the temporary administrator.
- Strengthen resolution capacity:
  - Enhance the National Bank of Georgia’s resolution function to improve implementation and operational readiness.
- Build contingency planning architecture:
  - Develop intra- and interagency contingency plans as foundational elements for a national financial crisis preparedness plan.

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## Content in this bundle

- **1geoea2023001 - Preface**
  - [1geoea2023001 - Preface (Markdown version)](/-/media/files/publications/cr/2023/english/1geoea2023001.pdf.md){rel="alternate" type="text/markdown"}
  - [1geoea2023001 - Preface (PDF)](/-/media/files/publications/cr/2023/english/1geoea2023001.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2023/01/10/georgia-technical-assistance-report-operationalizing-the-new-bank-recovery-and-resolution-528030_