Tashkent, Uzbekistan (UzDaily.com) -- The Center for Economic Research and Reforms (CERR) calculated the "Bank Activity Index" for the 4Q 2023, on the basis of which the rating of banks was updated. The index is calculated for 28 commercial banks grouped into two groups: large (17) and small (11) banks.

The index is determined based on the grouping of 27 types of coefficients, comparison and ranking. The study is conducted quarterly in order to monitor changes in the share of the private sector in banking assets, assess the effectiveness of reforms and transformation processes in the banking sector.

In calculating the Index, such indicators as financial intermediation, financial accessibility, capital adequacy, asset quality, management efficiency, earning ability, and liquidity were used. Banks are divided into two groups — large and small. At the same time, financial organizations operating only in Tashkent or in one of the regions are evaluated in the group of small banks.

Overview of the main performance indicators of banks for the Q4 2023

The assets of the banking system of the republic as of 1 December 2023 amounted to 631.4 trillion soums, which is 14% more than a year earlier; liabilities increased by 13% to 539 trillion soums, the balance of the loan portfolio amounted to 465.5 trillion soums with an increase of 22%, and the balance of deposits amounted to almost 230 trillion soums with an increase of 6%, compared to 51% last year.

Over the year, the share of foreign currency deposits in the total volume of deposits of the banking system decreased by 10 percentage points – from 42.5% to 31.8%. The growth rate of interest income increased by 5.4 percentage points and amounted to 38%, the growth of interest-free income and net profit slowed down by last year and amounted to 27% and 22%, respectively.

The share of problem loans has decreased. As of 1 December 2023, the share of problem loans (loans deferred for more than 90 days) in the banking system amounted to 17.6 trillion soums, and their share in the total volume of loans averaged 3.8% against 4% in the same period last year.

At the same time, the average share of problem loans in state-owned banks was 4.2%, against 2.9% in private ones. Of the state–owned banks, the highest proportion of problem loans was noted in Business Development Bank – 8.5% and Xalq Bank - 8.1%, while among private banks in Octobank – 84.6%, Garant Bank – 20.4% and Madad Invest Bank – 13%.

Rating of activity of large banks for the Q4 2023

Asia Alliance Bank lost the second place to Trast Bank. The bank, having lost two positions, gained a foothold on the 4th line of the overall rating.

Trast Bank showed the greatest activity among 17 large banks, which took the second place in the rating, improving performance in four indices at once: financial intermediation and accessibility, quality of management and liquidity.

Despite the fact that Kapital Bank slightly worsened its indicators of financial accessibility, quality of management and profitability, it continued to hold the lead, improving its indicators of capital adequacy and liquidity.

In the overall rating, three large private banks – Infinbank, Aloqa Bank and Ipoteka Bank – rose one line at once, while among the large state-owned banks, National Bank significantly improved its place in the overall rating, rising from 15th to 13th place.

At the same time, private banks – Ipak Yuli Bank and Business Development Bank, as well as the state – Xalq Bank, have slightly worsened their positions in the rating.

Among the large banks with state shares, the positions were retained by Mikrokreditbank – 11th place, Agro Bank – 12th, Uzpromstroy Bank – 14th, Turon Bank – 16th and Asaka Bank – 17th.

The activity rating of small banks for the Q4 2023

The top 6 in the rating of small banks remained unchanged. Davr Bank retained the leadership, Ziraat Bank gained a foothold on the 2nd line, Universal Bank and TBC Bank remained in third and fourth places, respectively.

Octobank, by 3 points at once, and Garant Bank improved their positions in the overall rating of small banks by 1 point, while Madad Invest Bank and UzKDB Bank lost two points each.

Index activity analysis

According to the financial intermediation index, 11 banks worsened their positions, among large banks, the largest decrease was noted at Business Development Bank, which lost 3 points, and among small banks – Ziraat Bank – minus 5 positions.

A total of 9 banks have worsened their capital adequacy index, of which the largest decrease was shown by the Business Development Bank minus 4 positions.

At the same time, another 12 banks improved their capital adequacy indicators. At the same time, Kapital Bank and Aloqa Bank showed the greatest activity among large banks – 3 and 4 positions, respectively, and among small banks – Octobank, where this indicator increased by 3 points.

Asset quality has deteriorated markedly in three large banks – Trast Bank, Asia Alliance Bank – minus 3 positions and Business Development Bank, which lost two lines, while among small banks, Tenge Bank has the most noticeable decrease in this indicator – minus 3 points.

10 out of 28 banks immediately increased their liquidity index. Kapital Bank showed the greatest activity, with an increase of 4 points, among large credit institutions, while Octobank showed the largest activity among small ones.