Uzbekistan outlines path to banking sector reform

New plans to clean up Soviet-style banking sector will see underperforming legacy loans transferred to state fund.

Uzbek policymakers have announced plans to clean up the balance sheets of the country’s largest banks as part of a drive to restructure and privatize the state-dominated sector.

Nearly 30 years after the end of the Soviet Union, publicly owned lenders still account for more than 80% of total banking assets in Uzbekistan.

Odilbek Isakov 160x186

Odilbek Isakov

Under former leader Islam Karimov, most were used as policy banks, channelling subsidized funding from the country’s sovereign wealth fund to state-owned enterprises (SOEs) and government projects.

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