BAKU, Azerbaijan, June 3
By Klavdiya Romakayeva - Trend:
The share of non-performing loan (NPL) from banks in Uzbekistan as of May 1, 2021, reached 4.4 percent of the total amount of loans issued, Trend reports referring to the Central Bank of Uzbekistan.
According to the information, non-performing loans, or problem loans include loans that are overdue for more than 90 days and are classified as unsatisfactory, doubtful and bad.
It is reported that if the banking system in Uzbekistan ended 2020 with a share of NPL at 2.1 percent, then as of February 1, 2021 the indicator increased to 2.7 percent, in March - to 2.8 percent, in April - 3.6 percent and in as of May 1, the figure rose to 4.4 percent, or $1.2 billion with total of $28 billion in the loan portfolio.
The share of problem loans increased in 10 out of 13 banks with a state share. In particular, the National Bank of Uzbekistan has the NLP indicator increased from $180 million to $246 million, Asaka Bank - from $142 million to $161 million, Agrobank - from $46 million to $104 million, Halyk Bank - from $77 million to $104 million, Qishloq Qurilish Bank - from $36 million to $68 million, Microcreditbank - from $16 million to $31 million, Alokabank - from $757,945 to $24 million.
In turn, NPL decreased in Uzpromstroybank, Poytakht Bank and Uzagroexportbank.
The quality of the loan portfolio among private banks practically did not change (NPL growth by 0.4 percent), but the situation remains difficult in Turkiston Bank, Hi-Tech Bank and Madad Invest Bank.
At the beginning of July 2020, stress tests by the Central Bank showed that the share of problem loans could increase several times, which poses a serious challenge for the banking system. It was predicted that a number of enterprises will not be able to service their loans after October 1, 2020.
Director of the Department of Methodology for Regulating the Activities of Credit Institutions of the Central Bank Sanzhar Nosirov noted then that due to the coronavirus pandemic, business activity in the country has sharply decreased, and enterprises and the population are experiencing difficulties in repaying debts to banks due to quarantine restrictions.
In April, Deputy Chairman of the Central Bank Abrorkhuzha Turdaliev reported that the NPL indicator in the loan portfolio of Uzbek banks will continue to grow.
“We expect that this level will nevertheless gradually increase, as the pandemic is having its effect. There are variables that affect the situation. This figure will grow, but we believe it will remain unambiguous. In fact, this level is quite acceptable, since today the level of capital and expected profit will be covered,” he said.
The deputy head of the Central Bank stressed that the upcoming increase in the share of problem loans will not significantly affect the stability of the banking system.
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