Uzbekistan has postponed the privatization of several state-owned banks to 2030, despite earlier plans to complete the sale of three banks by the end of 2025. Economist Abdulla Abdukadirov warns that if banks fail to meet investor expectations, the timeline could be pushed back even further.
The updated “Uzbekistan 2030” strategy outlines plans to reduce the number of state-owned banks from nine to four between 2026 and 2030, with five banks slated for privatization. According to the roadmap, no banks will be sold in 2026, two will be privatized in 2027, and one each in 2028, 2029 and 2030.
However, under previous presidential resolutions, three of these banks were expected to be privatized by 2025. The revised schedule reflects delays in implementation.
The Ministry of Economy and Finance’s fiscal strategy for 2026–2028 states that Uzsanoatqurilishbank, Asakabank, Aloqabank and Turonbank are expected to be privatized between 2025 and 2027. Meanwhile, Uzmilliybank, Agrobank, Mikrokreditbank, Xalq Banki and the Business Development Bank will remain under state ownership.
Authorities say the goal of privatization is to improve corporate governance, financial accountability and operational efficiency.
Structural risks deter investors
Speaking after the presentation of the updated strategy in Tashkent on February 20, Strategic Development and Reform Agency Deputy Chair Abdulla Abdukadirov said the key issue is not ownership, but performance.
According to Abdukadirov, many state banks are currently unattractive to private investors due to high levels of state intervention and structural imbalances in their loan portfolios.
He noted that some banks have issued excessively large loans to single borrowers, increasing concentration risks. In addition, the share of non-performing loans remains a concern for potential investors, who typically seek minimal exposure to financial risk.
As an example, he cited a large loan issued for the construction of the Tashkent Metallurgical Plant. While the project may be strategically important for the country, long-term repayment timelines complicate privatization prospects for the lending bank.
Abdukadirov emphasized that privatization negotiations are complex and require lengthy discussions with each potential investor. He acknowledged that even the 2030 target is not guaranteed if restructuring efforts do not sufficiently reduce risk.
State banks dominate lending but face NPL pressure
As of January 1, 2026, total outstanding loans in Uzbekistan’s banking sector reached UZS 604 trillion ($49.53bn), of which around UZS 404.5 trillion ($33.17bn) were issued by state-owned banks.
Out of total deposits amounting to UZS 417.2 trillion ($34.21bn), state banks held UZS 212.7 trillion ($17.44bn).
Non-performing loans (NPLs) remain disproportionately concentrated in state banks. At the beginning of the year, overdue loans totaled UZS 18 trillion (approximately $1.48bn), with UZS 12.8 trillion ($1.05bn) attributed to state lenders.
Uzmilliybank recorded the largest volume of problematic loans at UZS 3 trillion ($246mn), followed by Agrobank with UZS 2.7 trillion ($221mn) in non-performing assets.
