The influx of foreign funds did not lead to a boom in lending to the population and business in Uzbekistan, Forbes Russia has reported.

The Russian edition analysed the main directions of withdrawal of funds of Russians abroad – in particular, the countries of the South Caucasus and Central Asia. In none of these countries has there been a boom in lending to the population and businesses. For example, in 2022 the loan portfolio in Uzbekistan grew by 19.5% – which is only slightly higher than in 2021 (17.8%).

Instead of converting the funds received into loans, banks preferred to increase their highly liquid assets – primarily the amount of money in correspondent accounts and securities. According to the central bank of Uzbekistan, over the year highly liquid assets of commercial banks in the country went up by 37%, reaching UZS104.47 trillion, while the liquidity coverage ratio increased to a record 211.6%.

"Banks prefer to maintain a high volume of liquid assets, for example, they place them in securities and on accounts, and thus reduce their risks in case of possible outflows," said Sergey Voronenko, director of the S&P Ratings of Financial Institutions group.

According to him, local credit organisations were aware of the short-term inflow of funds from Russians, so they did not use them for long-term lending.

Anton Tabakh, chief economist at Expert RA, noted that the outflow of funds from Russian citizens would not happen simultaneously, but would be stretched over time.

In early June, during a speech in the Senate, Chairman of the Board of Uzbekistan’s Central Bank Mamarizo Nurmuratov reported that in 2022 the number of non-resident accounts in banks exceeded 60,000, and non-residents placed almost $892mn in Uzbek banks.