The level of dollarization of loans and deposits in Uzbekistan's banking system continued to decline in 2025, according to the Central Bank's Financial Stability Review for 2025.
As of January 1, 2026, foreign currency loans accounted for 39% of banks' total loan portfolio, down nearly 4 percentage points over the year.
During the same period, the share of foreign currency deposits fell from 25% to 21% of the total deposit portfolio.
The Central Bank noted that the decline in loan dollarization reduces risks associated with exchange rate fluctuations. When the national currency depreciates, payments on foreign currency loans increase in som terms, potentially worsening borrowers' solvency and leading to a rise in non-performing loans.
Annual growth of foreign currency deposits and loans. Despite the declining share of foreign currency operations in total portfolios, their volume in dollar terms increased.
By the end of 2025, the outstanding balance of foreign currency loans grew by 11% in U.S. dollar equivalent, while foreign currency deposits rose by 21%.
Growth rates also accelerated: annual growth of foreign currency loans increased by 8 percentage points, and deposits by 19 percentage points compared to 2024.
Thus, the decline in the dollarization rate indicates a reduction in the share of foreign currency in rapidly growing loan and deposit portfolios, but does not mean a decrease in the volume of foreign currency claims and liabilities.
The Central Bank emphasized that the increase in foreign currency loans expands the scale of credit risk that may arise when exchange rates change.
The growth of foreign currency deposits, in turn, could increase liquidity risks. The regulator links this to the possibility of depositors transferring funds from banks to foreign assets when opportunities for free overseas investment arise.
By the end of the year, the gap between foreign currency claims and liabilities of the banking system widened to 4 trillion soums.
According to the Central Bank's assessment, the widening of this gap indicates a potential increase in banks' losses in the event of currency risks materializing.
At the same time, the overall foreign currency position of banks remained within established limits. As of January 1, 2026, the ratio of net open foreign currency position to regulatory capital stood at 2.7%.
The Central Bank believes this level indicates that the banking system has sufficient capacity to cover potential losses from currency risks.
Central Bank Chairman Timur Ishmetov had previously noted the de-dollarization of the economy (declining share of foreign currency deposits and loans) as one of the positive outcomes of growing confidence in the national currency. Since 2018, deposit dollarization has fallen from 41.2% to 20%, and loan dollarization from 54.3% to 37.4%.
Source: www.gazeta.uz