Percentage of loans increases in Uzbekistan

Last month witnessed a notable increase in credit rates in Uzbekistan's banking sector, with rates climbing to 23%, alongside a simultaneous rise in deposit rates, reaching an impressive 21.2%. The Central Bank of Uzbekistan reported these developments, shedding light on the evolving financial landscape of the country.

In July, the average weighted interest rates for national currency loans surged to 23%, marking a significant uptick. Specifically, corporate loans were recorded at a rate of 22.5%, while retail loans experienced a slightly higher rate of 23.2%.

This surge in credit costs coincides with a continuous upward trend in deposit rates. As of the end of July, the average deposit rate reached an impressive 21.2%, representing the highest recorded level since 2014. This dynamic reflects a growing interest among individuals and businesses to park their funds in banks, thereby contributing to the overall growth of the financial sector.

The Central Bank's data provides valuable insight into the trajectory of loan rates over the past years. By the end of 2022, loan rates were noted at 22.3%, showing a progressive increase. This trend is further evident when comparing rates from 2021 (20.8%) and 2020 (18.8%).

Similarly, deposits have experienced a similar trajectory of growth. From 17% in 2020 to 20.2% in 2021 and maintaining the same rate in 2022, deposits reflect a consistent rise in investor confidence in the banking system.

It's notable that the financial landscape in Uzbekistan has witnessed a stable range of interest rates on loans denominated in the national currency. The average rates have remained around 22-23% per annum for the past few quarters. This stability indicates a certain level of predictability for borrowers and lenders alike, fostering an environment conducive to financial planning and decision-making.

In June, specific details regarding short-term and long-term loans were highlighted. The weighted average interest rates for short-term loans in the national currency were reported at 22.3%, while long-term loans carried a slightly higher rate of 22.7%.

Earlier Daryo reported that Uzbekistan unveiled foreign debt report.

Follow Daryo's official Instagram and Twitter pages to keep current on world news.