Uzbekistan to inject $500 million into commercial banks

TASHKENT (TCA) — Uzbekistan’s president has approved additional measures to improve financial stability and increase the capitalization of the country’s commercial banks, the Jahon information agency reported.

According to the document signed on June 16, in 2017 at the expense of the Fund for Reconstruction and Development of Uzbekistan, the state share in the authorized capitals of commercial banks will be increased by the equivalent of 500 million US dollars.

This money will be used for financing (co-financing) of approved targeted programs for social and economic development of Uzbekistan’s regions in 2017-2018 and financial support for business entities.

The Central Bank of Uzbekistan and the Fund for Reconstruction and Development were instructed to ensure the transfer of funds to the authorized capitals of commercial banks within a week.

The Central Bank has also been instructed to introduce a mechanism for provision of commercial banks with loans without guarantee for a period of up to three months in cases of acute shortage of liquidity. These loans will be issued only to maintain the liquidity of banks in order to ensure the continuity of payments not allowing the use of these resources for the issuance of loans by the banks.

This resolution has also given the right to the Central Bank to introduce a guardianship regime over a commercial bank that did not ensure the smooth execution of customer payments after receiving loans from the Central Bank.

Sergey Kwan