Tashkent, Uzbekistan (UzDaily.uz) — Uzbekistan’s new bank resolution regime is unlikely to apply to state-owned banks, which are expected to retain a moderate probability of extraordinary government support.
As a result, their government support ratings (GSRs) are expected to remain unchanged, international rating agency Fitch Ratings said.
In Fitch’s view, the new framework reinforces its position that senior creditors of private banks cannot rely on government assistance.
Fitch continues to factor government support into the long-term issuer default ratings (IDRs) of all state-owned banks in Uzbekistan, while private banks retain support ratings of “No Support.”
Under the new framework, domestic systemically important banks (D-SIBs) will undergo resolution under the supervision of the Central Bank of Uzbekistan. Possible measures include transferring assets and liabilities to another bank, establishing a bridge bank, and converting or writing down certain liabilities through a bail-in.
Non-systemic banks will be liquidated if they become insolvent, unless they perform critical functions.
The bail-in mechanism will primarily apply to capital and subordinated debt. If these resources are insufficient to absorb losses or restore capital adequacy, other liabilities, including senior debt, may also be affected, with customer deposits excluded.
The Central Bank may exempt certain liabilities from bail-in if their inclusion threatens financial stability or disrupts a bank’s critical functions.
However, Fitch noted that the possibility of applying bail-in to senior debt confirms that the authorities are unlikely to support senior creditors of private banks, including systemically important lenders.
The Central Bank’s detailed resolution regulations have yet to be approved, but the new law provides for government support to banks undergoing resolution.
According to Fitch, this indicates that the Central Bank and the government will provide sufficient support to troubled state-owned banks regardless of their systemic importance and will not impose bail-ins on their senior creditors.
The agency bases its assessment on the government’s majority ownership of these banks, their important role in implementing state policy, and the government’s strong financial flexibility. Foreign exchange reserves significantly exceed external borrowing.
Fitch estimates that external borrowings accounted for around 40% of the state-owned banks’ combined liabilities at the end of 2025.
A bail-in of senior debt would likely undermine access to external financing and increase borrowing costs for other state-owned enterprises.
Each bank’s government support assessment depends on its ownership structure, its role in implementing the government’s economic and social policies, and its track record of receiving state capital and funding.
The long-term IDRs of National Bank of Uzbekistan, Agrobank, People’s Bank, Business Development Bank, Aloqabank and Microcreditbank are aligned with Uzbekistan’s sovereign rating of “BB” with a Positive Outlook. Their government support ratings are set at “bb.”
Fitch attributes these ratings to the strategic nature of state ownership and the banks’ role in lending to priority sectors and supporting social programmes.
For National Bank of Uzbekistan, the agency also takes into account its high systemic importance. National Bank of Uzbekistan, Agrobank and People’s Bank are classified as systemically important banks.
Aloqabank remains formally included on the privatization list. However, Fitch believes its sale has become less likely following the bank’s expanded role in implementing government programmes in 2025.
Over the past five years, the government and related entities have injected US$2.4 billion into these banks in the form of capital contributions, according to Fitch.
The funds were used to support programmes implemented by the banks on behalf of the government and to maintain capital adequacy. National Bank of Uzbekistan did not require recapitalization.
According to Fitch’s chart, the banks received approximately US$420 million–US$430 million in both 2021 and 2022. Capital injections fell to around US$280 million in 2023 before rising to approximately US$620 million–US$630 million annually in 2024 and 2025.
The figures include both Tier 1 and Tier 2 capital.
Uzpromstroybank, Asaka Bank and Turon Bank received significantly smaller amounts: around US$60 million in 2021, approximately US$140 million and US$120 million in 2022 and 2023, respectively, about US$40 million in 2024, and around US$10 million in 2025.
Uzpromstroybank, Asaka Bank and Turon Bank have been preparing for privatization since 2020. Uzpromstroybank and Asaka Bank have ratings of “BB” with a Stable Outlook and government support ratings of “bb.”
Both banks are systemically important. Fitch said their Stable Outlooks reflect the non-strategic nature of state ownership and the more modest amount of support they have received in recent years.
The entry of foreign investors has improved their prospects for sale in the medium term, but Fitch does not expect either bank to be privatized before 2027.
Fitch expects the government to provide capital or funding support to these banks, if necessary, before their sale to preserve their viability and adequate capitalization. In particular, the government injected US$95 million into Asaka Bank’s capital ahead of the planned acquisition of a minority stake by the European Bank for Reconstruction and Development.
Turon Bank’s rating is one notch below the sovereign rating, at “BB-” with a Positive Outlook, while its government support rating is “bb-.” Fitch attributes this to the bank’s small size, lack of a clearly defined role in implementing government policy, and lower level of capital support.
A recent presidential decree reaffirmed plans to sell the bank to a strategic private investor by the end of 2028.
Private banks’ ratings do not factor in government support. Ipak Yuli Bank and Orient Finans Bank have ratings of “B+” with Stable Outlooks, Universal Bank is rated “B-” with a Stable Outlook, and Anor Bank is rated “CCC+.”
For Ipoteka Bank, rated “BB” with a Positive Outlook, and TBC Bank, rated “BB-” with a Stable Outlook, government support assessments do not apply because both banks are owned by foreign shareholders and Fitch factors in potential support from their owners. Ipoteka Bank is also classified as systemically important.
