🧠 CENTRAL BANK PREDICTIONS | BOGD BANK REPORT | WEBINAR WRAP-UP

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What do you call a person who’s happy on Monday? Unemployed. But in all seriousness, we understand that Mondays can be tough. Remember to stay motivated and keep pushing through the week!

🤔 DID YOU KNOW?

🧠 CENTRAL BANK PREDICTIONS

The Central Bank of Mongolia has published its latest assessment of the economy, drawing on the expertise of 27 academics and analysts. For the first time, the bank also consulted four private wealth managers: Ard, Mandal, DBM and Erdenes.

Inflation Will Cool Off

Inflation is expected to ease to 12.5% in the first quarter, down from 14.4% in the third quarter of 2022, according to a survey of analysts. Among the predictions, the best-case scenario is 10.4%, the worst 15%.

Growth Ahead

The predicted real GDP growth of 3.9% for this quarter is a 1.3% increase over the same period last year. The growth is expected to continue, reaching 4.7% by the end of the year.

Policy Rate to Fall

Analysts predict the policy rate to reach 13% (between 12% and 14%), before easing to 12.6% by year-end.

Interest Rate Will Stabilize

The weighted interest rate will hover at 16.1% in the first quarter of 2023, before settling at 16% by year-end.

Exchange Rate Devaluation Will Continue

Mongolia's currency slides as its currency reserve continues to slump. It is expected to hit 3,537 to the dollar in the first quarter and 3,744 by year-end.

The central bank’s adaptation to global conditions has nudged the economy towards a gradual recovery. But it remains far below its pre-pandemic growth rate.

✈️ DATA STORY

After declaring the period between 2023-2025 as the "Years to Visit Mongolia", the government has temporarily exempted nationals of 34 countries from the visa requirements for stays up to 30 days until 2025.

The Ministry clarified that its decision to exempt nationals of the EU/Schengen Area, the UK, Australia, and New Zealand from visa requirements was intended to boost the number of foreign tourists and facilitate the recovery of Mongolia's tourism sector. The number of nationalities that are visa-free to visit Mongolia, has later been increased to a total of 61.

📈 INVEST IN MONGOLIA

We had an insightful webinar on the topic "Invest in Mongolia" with special guests from Khan Bank and Mongolian Bankers Association. We would like to extend our gratitude to them for sharing their expertise with us.

The webinar received an overwhelming response, with 180 people registering for it. After a rigorous shortlisting process, 80 people were selected, out of which 30 attended the webinar. It was an informative session, covering various aspects of investing in Mongolia, including its economic landscape, investment opportunities, and challenges.

We appreciate the active participation and engagement of the attendees. Stay tuned for our upcoming webinars on similar topics.

💸 BOGD BANK’S AUDITED REPORT

Bogd Bank sets a great example for the level of transparency that open companies should exhibit. The bank recently released an audit report, providing a detailed overview of its performance over the past year.

Net profit grows by 76.9%

The total loans rose by 41% to reach ₮208.6 billion last year, with business loans making up ₮132.8 billion or 63.7% of the total loan portfolio. The increased loan portfolio led to a significant jump in profitability by 79.9% to ₮19.1 billion, and a 70.8% increase in interest income to ₮45.6 billion. Additionally, Bogd Bank's profitability helped it maintain a higher return on total assets than other public banks, with an ROA ratio of 4% compared to 1.1% for Golomt Bank (GLMT) and 2.3% for State Bank (SBM).

Current accounts and savings up 58.5%

The unaudited report revealed that Bogd Bank's (BOGD) current accounts and savings increased by 53.8% to ₮188.5 billion, with the audit revealing an even greater increase of 58.5% to reach ₮217.2 billion.

• Citizens 55.6%: Citizens' current accounts and savings constituted the majority of the bank's total, making up 55.6% of the total balance. Term savings accounted for ₮105.8 billion or 87.6% of this category. The private sector accounted for ₮40.5 billion or 41.9% of the remaining balance.

Company valuation

Based on last week's closing price, Golomt Bank and State Bank had P/B ratios of 1.04 and 1.03, respectively. In contrast, Bogd Bank's P/B ratio was 0.92, suggesting that the market is undervaluing the company's shares.

🏃 FEATURING INVESCORE PROPERTY

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🏃 QUICK STORIES

📌 UBCab to prepare for IPO. UBCab, Mongolia’s leading ridesharing service, announces its intention to go public. Founded in 2017, it has seen a rapid growth in recent years with more than 23,000 drivers and 700,000 riders using the service on a regular basis. Golomt Capital is set to underwrite its IPO.

📌 Crypto Nation (CNF) plans 10,000-for-1 stock split. Crypto Nation, a Mongolian cryptocurrency-investment firm, has announced a 10,000-for-1 stock split that will increase its outstanding shares to a whopping 1.13 billion. The company, partly owned by Ard Financial Group, manages assets worth some ₮4.6 billion ($1.6 million).

📌 Mongolian Mining Corporation (0975.HK) triples sales revenue. In 2022, the company's coal sales saw a significant rise of 194% to reach 4.7 million tons. This increase resulted in their sales revenue tripling to a whopping $546.2 million. As a result, Mongolian Mining Corporation’s net profit soared to $59.2 million.

📌 Four public companies on MSE to become private. These include Juulchin Duty Free (SUL), Azyk (ALD), Sonsgolon Barmat (SSG), and Silicate (SIL). They are expected to soon discuss the proposal to convert their corporate structure from a public company to a limited liability company. The move is said to be motivated by factors such as losses and over-concentration.

⭐ TOP NEWS

• Dalai Lama names Mongolian boy as new Buddhist spiritual leader (Firstpost)

• The War in Ukraine Could Formally End in Mongolia (The Diplomat)

• Mongolia and Great Britain make waves amid Georgia's judo heroes (Euronews)

• What Does Xi Jinping’s Third Term Mean for China-Mongolia Relations? (The Diplomat)

• As Mongolia diversifies economy away from single markets like China, prime minister courts global investors (South China Morning Post)

• Exiled Russians Build New Lives In Mongolia (Radio Free Europe)

• The Australian-Mongolian couple whose business is helping to preserve a minority language (SBS News)

💭 WATCH & LEARN

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Editor: E.Zolbayar
Writer: Ch.Anuun, A.Bilguun, A.Tuvshinzaya

Disclaimer: The information "Inside Mongolia" provides is for educational and informational purposes only. It is not intended to be and does not constitute financial advice, trading advice, or any other advice. The decision whether to take into account the information we provide is solely our readers' independent decision.