During the first half of the current year, Xalq Bank emerged as the leading provider of low-interest loans in Uzbekistan. In the period from January to June, the bank issued mortgage loans totaling over $67 mn more than what was granted during the corresponding period in 2022, Daryo reported on July 29.
"New Order" program boosts mortgage credit market
In 2020, Uzbekistan introduced the "new order” program, aimed at supporting the population in improving their housing conditions and fostering the development of the mortgage credit market. The Central Bank's "Mortgage Loan Review" revealed that during January to June 2023, 14,582 citizens were granted mortgage loans amounting to over $277 mn.
The loans were distributed as follows: 55 % (over $153 mn) for 1 and 2-room apartments, 32 % (around $113 mn) for 3-room apartments and larger units, and 13 % (over $37 mn) for private house construction.
The regions with the highest shares of mortgage loans under the "New Order" were Tashkent city (over $65 mn), Samarkand region (around $28 mn), Fergana region (around $23 mn), and Andijan region (around $22 mn).
Banks that dominate mortgage loan market
Xalq Bank dominated the mortgage loan market, holding the largest share at 32.7 %, which marked a substantial increase of more than $67 mn compared to the previous year. Ipoteka Bank followed with a share of 16.6 %, but it experienced a decrease of around $32 mn. O'zsanoatkurilishbank accounted for 13.3 %, showing a positive growth of over $29 mn, while Orient Finance Bank had an 11.5 % share, representing a rise of approximately $9 mn. Conversely, Qishloq Qurilish Bank, Milliy Bank, and Hamkorbank observed significant declines in their portions of mortgage loans under the "New Order."
Housing improvements supported by "New Order" program
Between 2020 and the first half of 2023, 38 % of the mortgage loans under the "New Order" (around $1.6 tn) were allocated to 82,529 citizens who had subsidy notifications and needed housing improvements. The regions with the highest allocation in this category were Samarkand, Surkhandarya, Tashkent city, and Fergana.
In the first half of 2023, 23.3 % (around $73 mn) of the "New Order" mortgage loans were directed to citizens with subsidy notices. Among these, over $7 mn were allocated to low-income citizens in need of social protection in Tashkent city, over $13 mn in Samarkand, over $6 mn in Tashkent, and $5.8 mn in Andijan regions.
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