Fitch Upgrades Outlook on Seven Uzbek State Banks to Positive

Tashkent, Uzbekistan (UzDaily.uz) — Fitch Ratings has revised its outlook on seven Uzbekistan state-owned banks from Stable to Positive, while affirming their long-term issuer default ratings in both foreign and local currency, along with their government support ratings, the agency announced.

The upgrade sweep covers six institutions — the National Bank for Foreign Economic Activity of Uzbekistan (NBU), Agrobank, Xalq Bank, Business Development Bank, Aloqabank, and Microcreditbank — all of which had their BB ratings affirmed with a government support assessment of 'bb'. Turonbank was also included in the revision, though its ratings were confirmed at the slightly lower BB- level with a corresponding 'bb-' support score.

Fitch attributed the outlook revision directly to a parallel change in Uzbekistan's sovereign rating outlook, stating that the move also reflects an enhanced capacity of the state to provide support to the financial sector.

The long-term ratings of all seven banks are pegged at the sovereign level, underpinned by three structural factors: high state ownership stakes, regular recapitalization by the government, and the banks' strategic roles in financing key economic sectors and social programs.

The agency drew a clear distinction between the institutions, however. Turonbank's comparatively limited strategic footprint was cited as the basis for its lower rating relative to the other six state lenders — a differentiation Fitch signaled it intends to maintain.

Looking ahead, Fitch noted that all seven ratings remain anchored to Uzbekistan's sovereign credit profile. Any future movement — upward or downward — will be directly contingent on shifts in the country's sovereign assessment and the government's ongoing commitment to bank sector support policy.

The revision adds to a broader pattern of improving institutional confidence in Uzbekistan's financial architecture, as the country continues structural reforms aimed at gradually privatizing parts of its state-dominated banking system.