Tashkent, Uzbekistan (UzDaily.com) -- Based on the use of the CR (concentration ratio) and HHI (Herfindahl-Hirschman index), which are widely used to determine the level of competition in a particular market, studies have been conducted. The values of these indices close to zero means a high level of competition.

When calculating the CR and HHI indices, the main performance indicators of all commercial banks operating in the republic in the period 2018-2023 were used, in particular, the volume of assets, deposits and loans.

Assets. As of 1 May 2023, the asset-based HHI stood at 927, down 593 units from 1 January 2018 (1,520). This, in turn, indicates that the banking system of our republic has moved from a moderately concentrated level to competitive market principles, and competition between banks has increased significantly.

Credits. In our economy, the volume of loan proceeds allocated by commercial banks has increased over the past 5 years by almost 3.3 times, or from 127.2 trillion soums (40.1% of GDP) to 413.4 trillion soums (46.5%) , of which the volume of loans to individuals increased by 7.5 times. These changes mean an increase in the coverage of the monetary market of our republic.

At the same time, the weighted average nominal interest rate on loans in the national currency increased from 20.0% in 2018 to 22.5% in 2023 for the corresponding period. The real interest rate on loans increased significantly from 0.3% (20.0-19.7) to 11.5% (22.5-11).

Deposits. The HHI index for the corresponding period decreased from 893.7 to 703 units. According to the results of the CR index calculation, as of 1 May 2018, the top 5 banks owned 51.8% of the total volume of deposits in the banking system, and by 1 May 2023, their share decreased to 40.5%. The share of deposits attracted by private banks increased from 32% to 40%. The leader among them is Kapitalbank, whose share in the deposit market increased from 4.9% to 12.1%.