Nasdaq Boosts Treasury Infrastructure with Georgian Banks

In what the companies call a "landmark" partnership to support the growth of the banking sector, Nasdaq has partnered with the National Bank of Georgia. 

Under a shared infrastructure model, five other large commercial banks, including TBC Bank, Liberty Bank, Basisbank and Terabank will also gain access. These are some of the country’s largest banks, representing the majority of the country’s commercial banking assets. 

The partnership, which marks a milestone in the development of the country’s capital markets, is operating under the Georgian Market Advancement Program (GMPA),  in addition to the Georgian Financial Markets Treasuries’ Association. 

The model spans a full front-to-back trade lifecycle. 

Natia Turnava, Governor of the National Bank of Georgia, says: “Modernising Georgia's treasury infrastructure is a strategic priority for the National Bank of Georgia and a critical step in the continued development of our financial system. 

“By bringing the country's five largest commercial banks onto a common, internationally recognised platform, we are raising the standard of risk management, regulatory oversight and operational resilience across the sector.”

A timely change 

The country’s banking sector has experienced rapid growth, with numbers reaching double digits in the last five years. Total assets are approaching roughly US$38bn according to the announcement. 

The sector has matured into a deeper and more dynamic environment, meaning that its infrastructure needed to be updated to adequately support this. 

Natia continues: “This initiative reflects our commitment to building a financial market that is robust, transparent, aligned with international best practice and equipped to support Georgia's continued economic growth.”

To ensure the most success in supporting the growth of complex securities, the partnership has been split to accommodate other banks in a coordinated manner. 

By pooling resources, and expertise, the development of the markets is stronger, and what Nasdaq terms as the “most efficient” method of achieving “ambition at scale”. 

Magnus Haglind, Head of Capital Markets Technology at Nasdaq, comments: “Georgia presents a compelling example of how the shared infrastructure model can unlock real value for individual institutions and the financial system as a whole. 

“By drawing on Nasdaq’s experience navigating modernisation programs at scale, firms gain access to deep institutional knowledge and the ability to evolve without bearing the full cost, risk, or operational complexity of doing it alone. 

“GMAP reflects exactly the kind of structured, country-level framework that enables this type of transformation to succeed. We welcome the opportunity to support the National Bank of Georgia in this initiative, and to help Georgia's banking sector build the infrastructure it needs for its next phase of growth.”

A more unified approach to growth 

While a coordinated effort is the strongest path forward, the data will remain fully segregated between banks in order to preserve privacy. 

The infrastructure model will involve a centralised location at each bank. Individual benefits involve tailored support for each bank’s business requirements, operational context and of course risk profile. 

Further benefits from the common framework include the addition of standardised reporting and workflows, providing greater clarity in to treasury exposures, systemic risk and liquidity positions. 

Market data will also be shared under the framework, and the banks will benefit from collective oversight, audit capabilities and governance. 

Georgia’s continued integration with international standards, such as ISO 20022, mean that the addition of consistent frameworks around common reporting and audit trails will reduce burden on both the regulators and the banks.