TASHKENT, Uzbekistan, April 2. Moody’s Ratings has assigned B3 long-term local and foreign currency deposit and issuer ratings to Uzbekistan's Octobank, the agency told Trend.
The bank’s Baseline Credit Assessment (BCA) has been set at b3, with an Adjusted BCA of b3. Additionally, Octobank received a long-term Counterparty Risk Assessment (CR Assessment) of B2(cr) and long-term local and foreign currency Counterparty Risk Ratings (CRRs) of B2. The outlook on the long-term deposit and issuer ratings is stable.
Moody’s noted that Octobank’s B3 ratings are based on its b3 BCA, reflecting strong capital and liquidity levels. However, the bank does not receive any government support uplift due to its private ownership and small market share of 0.4 percent by total assets in Uzbekistan. The bank’s niche business model, which heavily relies on remittance payments and short-term corporate deposits, along with its aggressive growth strategy and key-man risk, were cited as the main factors constraining its rating.
Octobank maintains a highly liquid asset structure, with 80 percent of its total assets held in liquid form as of year-end 2024, significantly reducing its exposure to credit risk compared to local peers. The bank’s securities portfolio, primarily consisting of bonds issued by the Government of Uzbekistan and the Central Bank of Uzbekistan (CBU), accounts for 31 percent of total assets. Meanwhile, cash and cash equivalents and funds due from banks make up 28 percent and 20 percent, respectively.
Despite its limited loan portfolio, Octobank has maintained low levels of problem loans, with Stage 3 loans accounting for less than 3 percent of total gross loans as of the end of 2024. These loans are well-secured by tangible collateral. Moody’s expects the bank to expand its loan portfolio significantly over the next 12-18 months as it seeks to diversify its revenue streams.
Moody’s highlighted Octobank’s strong capital adequacy, which remains a key strength. As of year-end 2024, the bank’s Moody’s adjusted tangible common equity (TCE) to risk-weighted assets (RWA) ratio stood at 29.3 percent. Octobank’s regulatory capital ratios are also well above the required thresholds, with a Tier 1 ratio of 38 percent and a total capital adequacy ratio of 48.3 percent, compared to the regulatory minima of 10 percent and 13 percent, respectively. These levels provide a substantial buffer against potential credit and market risks while supporting the bank’s expected rapid growth over the coming months.
