Uzbekistan's banking sector privatization is facing some setbacks with delays to both Asakabank and SQB, as it was disclosed by press service of of the Central Bank on April 25.
One of the primary obstacles cited by Chairman of the bank, Mamarizo Nurmuratov is the transformation of corporate governance within these banks, a pivotal step in their journey towards privatization. Over the past two years, efforts in this regard have been underway with Asakabank, with the European Bank for Reconstruction and Development (EBRD) leading the charge. Similarly, the International Finance Corporation (IFC) has been instrumental in preparing Uzpromstroybank for privatization.
"At SQB, the first steps on privatization have already been taken, that is, three international financial institutions (IFC, EBRD, and ADB) have allocated credit lines with the subsequent conversion of these lines into shares of this bank," shared Nurmuratov.
Furthermore, Nurmuratov highlighted the crucial need for training personnel to meet the stringent requirements of risk-based supervision, corporate governance, and other international standards within the banking sector.
Another significant factor impeding the privatization process is Uzbekistan's inclusion in a list of 14 countries with sanctions risks. Nurmuratov emphasized that this designation sends a negative signal to foreign investors considering investments in these countries' economies, posing a deterrent to potential investors eyeing the Uzbek banking sector.
Despite these challenges, Nurmuratov reiterated the priority placed on selling state-owned banks to strategic investors possessing expertise in banking operations.
On April 2, Ministry of Economy and Finance, Jamshid Kuchkarov reiterated the government's dedication to enacting reforms laid out in the "Uzbekistan - 2030" strategy. He revealed that preparations are in progress to finalize an agreement with the EBRD in May aimed at readying Asakabank for privatization.
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