BAKU, Azerbaijan, January 23. Banks in the Central Asia and the South Caucasus are expected to remain resilient in 2026, Trend reports via the S&P Global Ratings.
The rating agency expects banks in Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, and Uzbekistan to remain resilient in 2026, in line with the previous two years, with profitability and capital levels supported by moderating (but still strong) average regional lending growth of 15%-20% and stable asset quality.
“Favourable economic growth prospects across the region, high lending demand (especially in the retail segment), sound funding and liquidity metrics, and stable capital buffers supported by solid profitability could lead to further positive rating actions in 2026,” reads the report.
S&P notes that currently,19% of financial institutions’ ratings in the region have positive outlooks and 81% have stable outlooks.
“Key risks for financial institutions in the region include elevated geopolitical tensions, aggressive retail lending growth that could increase imbalances, and evolving risks related to digitalization, AI, climate change, and cyber threats,” the report says.