Moody's expects high economic growth in Uzbekistan
By Kamila Aliyeva
International rating agency Moody's expects Uzbekistan to maintain high growth rates of the economy. This was stated in the agency's message on September 4.
The economy of Uzbekistan is growing at a faster rate than that of other CIS countries.
“High growth rates [of Uzbekistan's economy] will continue in 2018-2019 due to government spending, capital investment, and the restoration of remittances of labor migrants from Russia,” the agency said.
In addition, despite the high level of dollarization of the banking system of Uzbekistan, currency risks concentrated mainly in state-owned banks will remain moderate, according to Moody’s.
Overall, Moody's maintained a stable outlook for the banking sector of Uzbekistan.
The banking system of Uzbekistan, according to the agency, is characterized by the moderate size and dominance of state-owned banks. It remains focused on the corporate sector as a whole, and especially on state-owned companies and the largest borrowers.
At the same time, Moody's experts believe that the quality of bank assets will remain good.
“The share of problem loans will remain at the same level due to economic growth, declining inflation and rapid credit growth,” the agency said.
The profitability and adequacy of the capital of Uzbek banks will gradually decline due to a reduction in net interest margins and rapid asset growth.
The banking system will maintain a good level of liquidity, and the state will continue to provide support to state-owned banks, according to the message.
Moody's is an international rating agency. Engaged in assigning credit ratings, research and risk analysis. Moody's, along with Standard & Poor's and Fitch Ratings, is included in the “Big Three” of international rating agencies.
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Kamila Aliyeva is AzerNews’ staff journalist, follow her on Twitter: @Kami_Aliyeva
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