The FTSE 100 will get a new bank stock later this month, joining HSBC, Lloyds, Barclays, NatWest, and Standard Chartered in the UK’s premier index. This is the lender’s reward for its share price soaring an incredible 877% in the past five years.
Dividends take the total return well north of 1,000% over this period!
Let’s take a closer look at this Footsie newbie to see whether it might be worth considering buying.
A rocket on the London Stock Exchange
The stock in question is Lion Finance Group (LSE:BGEO), formerly Bank of Georgia. It will enter the FTSE 100 in two weeks when the latest changes take place. Joining it will be online trading platform IG Group, while airline easyJet and Hikma Pharmaceuticals will drop out.
What has caused this incredible performance? Put simply, Lion Finance has benefitted from an incredibly strong Georgian economy.
Between 2021 and 2024, GDP growth averaged over 9% annually, driven by financial inflows, low inflation, higher consumption, an influx of skilled migrants fleeing the war in Ukraine, rising tourism, and the nation’s location as a trading/logistics hub between East and West.
The bank has taken full advantage of these fertile conditions, with earnings growing at a five-year compound annual rate of about 50%. Dividends and share buybacks have been plentiful, attracting more investors to the stock.
The acquisition of Ameriabank (the leading bank in neighbouring Armenia) in 2024 provided a second high-growth engine.
I sold too soon
Alas, I previously owned this stock but sold it in late 2024 when things kicked off in Georgia after the contested election result there. This saw mass public protests gather across the country amid accusations of vote-rigging. Things looked very dicey at the time.
With the nation’s ascension to the European Union on hold, and the government facing international scrutiny, I feared political unrest could lead to lower foreign direct investment and tourism. I personally put off visiting Tbilisi at the time.
However, while logical, my fears were ultimately misplaced. Last year, Georgia’s economy grew by 7.5%. And while that did mark a slowdown from previous years, Georgia remains one of the fastest-growing economies in Europe and the Caucasus, as does Armenia.
Lion Finance’s net profit in 2025 jumped 21% to GEL 2.2bn (roughly £600m), with an exceptional return on average equity of 28.4%. Retail digital monthly active users grew 15% in Georgia, reaching over 1.8m, up from just 355,000 in 2019.
Meanwhile, Ameriabank’s digital monthly active users surged by 45.3% to 336,000, with standalone profit growing 23.6%.
Value on offer
Clearly, the bank has been firing on all cylinders in recent years. But is the stock worth considering as it enters the FTSE 100? I think it is, despite the aforementioned political risks, which could flare up at any point between the pro-Russia and EU-aligned political factions.
The forward price-to-earnings ratio is just six, which is well below the FTSE 100 average and other bank stocks. Pair this with a very well-covered 3.5% dividend yield, and I see a lot of value on offer here.
Note, the International Monetary Fund projects Georgian GDP growth of 5% over the medium term. Plus, Armenia offers a lot of long-term growth in digital banking. Today Ameriabank’s digital penetration is only around 11% of the overall population.
