Tashkent, Uzbekistan (UzDaily.com) — The Institute for Market Research and Innovation (IMRI) has analyzed the level of competition in Uzbekistan’s banking system for the second quarter of 2024 using the Herfindahl-Hirschman Index (HHI).

Assets: The HHI for assets improved by 53 points from 916 to 863. This positive change indicates a more competitive market. Total assets of commercial banks reached 690.4 trillion soums, a 19.7% increase compared to the same period in 2023. The share of state-owned banks in total assets decreased from 69% to 67%, reflecting an improved competitive environment.

Loans: The HHI for loan volumes improved by 8 points, from 971 to 963. The total volume of loans increased by 70 trillion soums to 493.9 trillion soums. The share of loans provided by banks with private and foreign capital grew from 27% to 30%. The share of the top-5 state-owned banks in the overall loan portfolio decreased from 59.4% to 57.8%. The average nominal interest rate on loans in national currency fell to 23.6% from 24.2%.

Deposits: Total deposits attracted by commercial banks amounted to 265.4 trillion soums, a 30% increase compared to the same period in 2023. Despite this growth, the HHI worsened from 664 to 693 due to an increase in the share of deposits held by certain state-owned banks. For example, "Uzbekistan National Bank" saw its share rise from 13.6% to 14.3%, "Halk Bank" from 7.4% to 8%, and "Turon Bank" from 1.5% to 2%. The share of deposits from banks with private and foreign capital increased by 1% to 49%.

Conclusion: The data indicates a positive trend in the competition within the asset and loan markets, while the deposit market shows mixed results with increasing concentration among state-owned banks.