TASHKENT, Uzbekistan, March 28. Moody’s Investors Service, international rating agency, has reaffirmed Uzbek Kapitalbank JSCB's long-term local and foreign currency bank deposit ratings at B2 with a stable outlook, Trend reports.
As per Moody’s, the affirmation takes into account Kapitalbank's evolving business model and aggressive strategy, balanced by strong financial performance and good asset quality.
In 2023, Kapitalbank achieved record high earnings of 1.7 trillion soums ($134.8 million), resulting in a high 4.1 percent return on tangible assets, bolstered by strong interest income and rapid lending growth, particularly in high-yielding retail loans.
Moody's anticipates stable capital adequacy, despite pressure from rapid growth and stricter regulatory standards. Tangible common equity is expected to remain around 10 percent of risk-weighted assets in the next 12 months.
Asset quality remains robust, with problem loans accounting for 1.65 percent of gross loans in 2023. While Moody's expects a slight deterioration in asset quality due to rapid growth, it is anticipated to remain strong. The bank's significant loan expansion in recent years has strained capital and distorted financial results, with gross loans expanding by 78 percent in 2023. Moody's forecasts a moderation in growth over the next 12–18 months due to capital constraints.
The stable outlook on long-term deposit ratings reflects Moody's expectation of broadly stable credit fundamentals in the next 12–18 months.
Earlier, Moody’s assigned Uzbekistan’s Kafil Sugurta insurance company with a B2 local currency (LC) and foreign currency (FC) insurance financial strength ratings (IFSRs) with a stable outlook.