Moody’s Affirms Garant Bank Ratings with Positive Outlook

Tashkent, Uzbekistan (UzDaily.com) — International rating agency Moody’s has affirmed the credit ratings of JSC Garant Bank, including the Baseline Credit Assessment (BCA) at caa1, long-term deposits at Caa1, short-term ratings at NP, and counterparty ratings at B3/NP and B3(cr)/NP(cr). The outlook for long-term deposits was revised from “stable” to “positive.”

The decision reflects a significant improvement in the bank’s credit profile following recapitalization at the end of 2024, changes in ownership and management, and a return to profitability after two years of losses.

In 2025, Garant Bank experienced rapid growth: total assets more than doubled to 4.35 trillion soums (US$362 million), largely driven by higher liquid assets, purchases of government securities, and an 83% expansion of the loan portfolio. Non-performing loans fell to 4.9% at the end of 2025 from 14.8% in 2024, demonstrating disciplined portfolio growth and repayment of problem loans. However, the Tier 1 capital ratio declined from 22% to 15% due to rapid balance sheet expansion, increasing reliance on future shareholder capital injections.

Garant Bank’s net profit under local GAAP reached 5.2 billion soums in 2025, compared to a loss of 64.3 billion soums the previous year, while return on assets remained modest at approximately 0.2%. Profitability improvements were supported by higher interest income and lower loan loss provisions. Moody’s expects gradual improvement in earnings over the next 12–18 months, provided disciplined credit and expense management continues.

Funding and liquidity strengthened significantly: the share of high-quality liquid assets rose to 47% of total assets from 24% in 2024, and an inflow of client deposits, mainly current and corporate accounts, provided a foundation for balance sheet growth.

Moody’s noted that rating upgrades are possible if the bank maintains a cautious growth strategy, continues to improve asset quality, profitability, and capital, and further diversifies funding. Conversely, a deterioration in credit quality, renewed losses, or reduced liquidity could pressure the bank’s long-term ratings.