Heads and employees of the Central Bank, Uzbekistan Banking Association and commercial banks of Uzbekistan participated at the conference.

Speaking at the opening ceremony, representative of the Central Bank of Uzbekistan Jahongir Abdurasulov said that currently there are 29 banks in Uzbekistan, of which three are state, nine – private and four – banks with foreign capital. The banks have over 4,100 branches and mini-banks across Uzbekistan.

He said that the capital of the banks rose by 3.2 times in last five years (33% a year in average), assets – 2.9 times (31%) and loans – 3.3 times (33.7%). He said that the banking sector mainly funded due to internal resources and its share made up 85.8% in 2012 compared to 46% in 2000.

According to Fitch Ratings, currently the agency assigned rating to seven banks of Uzbekistan, including Agrobank, Asaka Bank, Microcreditbank, Uzpromstroybank, Trust Bank, KDB Bank Uzbekistan and Universalbank.

James Watson, managing director within the financial institutions group of Fitch Ratings, (on photos) said that the banking system of Uzbekistan, according to the opinion of the agency, has positive moments and aspects for further growth and development.

Watson said that sustainable growth of economy of Uzbekistan is a positive moment, which supports the growth of banking sector of the country. Fitch Ratings said that the growth of economy has been exceeding 8% since 2008.

According to data of Fitch Ratings, the public debt of Uzbekistan is low – 8.6% to GDP in 2012. The reserves of Uzbekistan (excluding gold) grew from US$18 billion in 2011 to US$18.3 billion in 2012. Current account surplus made up 2.7% to GDP in 2012. High prices for resources (gold, copper, gas, etc) help to growth of income of Uzbekista.

He said that another positive moment that the banking sector is mainly funded due to internal resources and in local currency. The representative of Fitch Ratings underlined stable level of quality of assets of the banking system.

Speaking about areas with potential for development, he said that the banking system of Uzbekistan should pay attention to level of capitalization and banking service penetration – both in deposits and crediting of real sector of economy.

James Watson underlined that the banking system is developing with rapid temp. He said that after sharp growth of crediting in 2010 (about 60%), the growth rates decreased to sustainable level (2011 – about 35% and 2012 – about 30%).

He added that despite the growth of crediting, the level of debt load of economy is still low. He said that the ratio of loan to the GDP of Uzbekistan was slightly higher than 20% in 2012. He said that the figure is between 30% and 60% in some CIS states.

According to Fitch Ratings, share of the state banks makes up about 80% in the loan portfolio of the banking sector. Over 20% growth of loan portfolio in 2012 was connected with execution of social programmes.

Watson said that the funding base of the banks is mainly based on corporate clients and targeted loans of the government. He said that the Fund for Reconstruction and Development of Uzbekistan (FRDU) became one of main sources of funding of the banking system by the government.

Fitch Ratings said that the growth of the FRDU capital up to US$15 billion will make it equal to the current state of all banking system of Uzbekistan. Watson said that the FRDU issued loans for US$2.5 billion, which makes up 13-14% to total liabilities of the banks.

Speaking about foreign funding of the banking system, he said that the liabilities of the banking system before the foreign creditors traditionally do not exceed 10% of total funding base of the banking system.

At the same time, he said that main part of foreign loans was issued by the development institutes such as ADB, EBRD and World Bank, as well as foreign banks within the project financing. He said it will decrease risks.

Fitch Ratings’ representative said James Watson said the Uzbek banking system has potential to attract more deposits from individuals. Share of deposits in total funding of the bank makes up about 15%, despite their stable grows. He said that compared to other CIS states, the banking sector of Uzbekistan has the most untapped potential for attracting retail deposits.