President Shavkat Mirziyoyev reviewed a presentation on the further development of Uzbekistan’s capital market and the acceleration of international standards in the banking system.
The presentation highlighted that the current market value of securities in circulation stands at UZS 275 trillion ($22.7bn), with free exchange trading reaching UZS 4 trillion ($329.9mn). The market comprises 717 issuers and 77 professional participants. Despite this growth, the capital market’s capitalization accounts for only 20% of GDP, well below global benchmarks, signaling substantial potential for expansion.
Officials discussed measures to attract at least $1bn in investments to the local capital market. Plans include introducing "dual listing" operations to allow securities to be placed on both local and foreign exchanges according to international standards. New financial instruments are also being considered, including currency bonds, global depositary receipts, foreign securities, and exchange-traded investment funds.
The presentation emphasized expanding the “regulatory sandbox” legal regime. It was proposed that sandbox conditions be extended to both residents and non-residents, allow indefinite participation for foreign investors, and enable trading in stocks, bonds, and other foreign securities. This, officials noted, would reduce unofficial trading of foreign securities.
Efforts to increase domestic investor participation were also highlighted. Local companies and banks will be allowed to issue bonds in foreign currency on the Tashkent Stock Exchange, providing access to foreign capital without entering external markets. Additionally, the bond market may expand by allowing the issuance of unsecured bonds exceeding issuers’ own capital.
The session also addressed improvements in market regulation. National legislation is planned to align with the International Organization of Securities Commissions, strengthen regulatory powers, and gradually raise charter capital requirements for professional participants.
Over the past seven years, banking reforms have increased the sector’s strength. Commercial bank assets have grown 5.3 times, exceeding UZS 877 trillion ($72.3bn). The number of banks has reached 35, and three foreign banks have begun operations since 2018.
For the first time, Uzbekistan participated in the Financial Sector Assessment Program by the IMF and World Bank, reviewing banking supervision, risk management, payment systems, macroprudential policies, and crisis management.
Following this assessment, Uzbekistan plans to fully align its financial sector with the 29 Core Principles for Effective Banking Supervision of the Basel Committee. Next year’s objectives include ensuring all commercial banks’ financial statements comply with international standards, finalizing Basel III implementation, and establishing a Financial Stability Council comprising government and Central Bank representatives.
President Mirziyoyev stressed that developing the capital market and reforming the banking system are crucial for stable economic financing, increasing private sector involvement, and attracting international investment. He set specific tasks for responsible officials to advance these initiatives.
