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ADB allocates $50 million to support privatization of state banks in Uzbekistan

10 November 2023 21:15 (UTC+04:00)
ADB allocates $50 million to support privatization of state banks in Uzbekistan

On November 10, the Asian Development Bank (ADB) and Uzbekistan’s Sanoat Qurilish Bank (SQB) signed a senior convertible loan of $50 million to support Uzbekistan’s privatization of state-owned banks, which will strengthen the banking sector and contribute to economic growth and job creation, Azernews reports, citing Kun.uz news agency.

The Manila-based bank said the International Finance Corporation and the European Bank for Reconstruction and Development are parallel lenders.

The ADB said the loan proceeds will help SQB expand its financing to underserved micro, small, and medium-sized enterprises (MSMEs). Portfolio diversification will contribute to SQB's transition into a fully universal commercial bank by serving a broader customer segment.

The ADB added that it will also provide technical assistance to help SQB implement its transformation roadmap.

In 2017, Uzbekistan embarked on an ambitious market reform agenda, including the privatization of more than 100 state-owned banks.

MSMEs play a significant role in Uzbekistan’s economy, comprising the majority of registered businesses and employing 74 percent of the workforce. However, access to financing remains a challenge, with only 13 percent of the sector having access to commercial loans, the bank said.

The Manila-based bank said the International Finance Corporation and the European Bank for Reconstruction and Development are parallel lenders.

The ADB said the loan proceeds will help SQB expand its financing to underserved micro, small, and medium-sized enterprises (MSMEs). Portfolio diversification will contribute to SQB's transition into a fully universal commercial bank by serving a broader customer segment.

The ADB added that it will also provide technical assistance to help SQB implement its transformation roadmap.

In 2017, Uzbekistan embarked on an ambitious market reform agenda, including the privatization of more than 100 state-owned banks.

MSMEs play a significant role in Uzbekistan’s economy, comprising the majority of registered businesses and employing 74 percent of the workforce. However, access to financing remains a challenge, with only 13 percent of the sector having access to commercial loans, the bank said.

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