At the same time, QQB's E+ bank financial strength rating (BFSR), B3 long-term global scale foreign currency deposit rating and its Not Prime short-term global scale local and foreign currency deposit ratings were affirmed. All of the bank's ratings carry a stable outlook.

The upgrade follows the acquisition of a 69% stake in QQB by the Uzbek state through the Ministry of Finance and the Fund for Reconstruction and Development of Uzbekistan in Q2 2009. Accompanying the change of control, QQB's name was changed from Gallabank and a new strategy of supporting rural construction development was announced.

"In Moody's view, the state's ownership of QQB is likely to result in a high probability of support from the parent, in case of need," says Elena Redko, a Moody's Analyst and lead analyst for QQB. "This perception stems from Moody's awareness of (i) the government's strategy for development of the agriculture sector and rural construction as a socially and economically important segment, and (ii) QQB's role constituting a platform for implementation of these development plans in 2009-2010."

QQB has already initiated the development of new products on the back of its cooperation with major construction and agriculture companies in line with the government's strategy. The implementation of the strategy will be supported by additional preferentially priced funding from the government as well as income and property tax exemption till 2012 and allocation of state property to the bank for further utilisation.

Moody's previous rating action on QQB was on 11 April 2008 when the rating agency assigned a first-time ratings of B3/Not-Prime/E+ with stable outlook to the bank (then trading under the Gallabank name).

Headquartered in Tashkent, Uzbekistan, QQB reported total IFRS assets of UZS171 billion (US$123 million) and net income of UZS5 billion (US$3.7 million) as at 31 December 2008.