According to the financial stability review published by the Central Bank, the level of dollar lending in the portfolios of Uzbek banks continued to decline throughout 2025.
According to the financial stability review published by the Central Bank, the level of dollar lending in the portfolios of Uzbek banks continued to decline throughout 2025.
As of January 1, 2026, the share of foreign currency loans amounted to 39% of the total portfolio, representing a reduction of almost 4 percentage points over the year. Meanwhile, the share of foreign currency deposits decreased from 25% to 21%.
The regulator noted that the decrease in dollar lending helps mitigate credit risks associated with borrowers' deteriorating solvency during exchange rate fluctuations. A borrower whose income is denominated in soums but whose debts are in foreign currency is the most vulnerable when the national currency weakens.
Nevertheless, the early warning map included in the same review recorded an increase in the banking system's sensitivity to currency risks. During 2025, the gap between the bank's foreign currency assets and liabilities widened, leading to an increase in the net open foreign currency position. This prolonged currency position has increased the dependence of banks' financial results on exchange rate dynamics.
The ratio of banks' loan portfolio to GDP decreased by two percentage points during the year, reaching 33%. This indicator is below the lower quartile range for European and Central Asian countries, but it exceeds the median for Central Asian and Caucasian states by seven percentage points. The Central Bank interprets this decrease as a reduction in the overall debt burden in the economy.
The regulator also drew attention to the widening gap between interest rates on loans in the national currency and the yield on treasury bonds. Loan rates are decreasing slower than government bond rates, which indicates a rise in the credit risk premium, as banks assess borrower risks higher than before.
According to the financial stability review published by the Central Bank, market housing prices in Uzbekistan decreased by 4.8% year-on-year by the end of 2025. These prices returned to the limits of the standard deviation of the calculated fundamental value.
However, when considering prices in US dollars, they showed an increase of 1.5% due to the strengthening of the sum against the US dollar. The Central Bank uses four models, including the Bayesian spatial state model and quantile regression, to estimate the fundamental value of housing.
The regulator links the return of market prices to the specified range with an increase in supply, including new construction, as well as with price correction against the backdrop of household income growth and easing mortgage conditions.
A shift in consumer behavior is observed: market participants are moving away from bets on asset appreciation and transitioning to more cautious investments focused on generating stable rental income. Over the year, rental rates increased by approximately 3%, while the ratio of housing price growth to rent growth fell below one.
The debt burden for borrowers has significantly decreased. The average debt service-to-income ratio for mortgage recipients, accounting for all their obligations, was 49%, representing a reduction of 22 percentage points over the year. Similarly, for auto loans, the average debt service-to-income ratio decreased from 60% to 37%.
The share of loans issued to borrowers with a debt service-to-income ratio of no more than 40% increased from 58% to 74% of the total payments. The regulator attributes this to the tightening of macroprudential requirements. Direct loan-to-value limits have been in effect since July 24, 2025, setting a maximum limit of 85% for mortgages. The introduction of these restrictions has improved the collateralization of mortgages and auto loans.
Overall, the average debt service-to-income ratio for all individual banking borrowers, including non-banking sector obligations, decreased from 38% to 37%. The Central Bank concluded that, against this background, the risk of bank losses on the retail portfolio has decreased.
