Uzbek Banks Report Strong Q1 2026 Earnings Amid Expanding Assets and Rising Competition

As of the first quarter of 2026, major players in Uzbekistan's banking sector—including Octobank, Tengebank, Kapitalbank, Milliybank, and Hayotbank—have released their financial reports, revealing robust income growth, asset expansion, and intensifying market competition.

Asset Growth and Income Diversification Drive Sector Momentum

Bank assets reached 15.52 trillion Uzbek soums during the quarter, marking a notable increase compared to the start of the period. Investment portfolios constituted the largest asset share, totaling 6.71 trillion soums, underscoring banks’ strategic focus on investment instruments as a core revenue source.

Income streams demonstrated significant diversification. Interest income amounted to 238.3 billion soums, while non-interest income surged to 1.2 trillion soums, indicating a dynamic shift towards fee-based services and other non-traditional banking revenues.

On the expense side, interest costs stood at 176.9 billion soums, with non-interest expenses at 1.04 trillion soums. Operating costs accounted for 111.6 billion soums, of which 73.8 billion soums were allocated to employee compensation. Tax payments to the state budget totaled 110 million soums within the reporting period.

Highlight on Individual Bank Performance and Financial Health

"Tengebank’s net profit soared to nearly 34 billion soums in Q1 2026, a multi-fold increase compared to the 920.9 million soums in the same period of the previous year."

Tengebank reported a dramatic increase in net profit, reaching about 34 billion soums, compared to just 920.9 million soums in Q1 2025. This performance builds on prior years, with 2025 net profits at 54.9 billion soums and 36.2 billion soums in 2024. Despite relatively stable interest income, the bank faced a negative net interest result of -5.3 billion soums due to increased provisions for potential credit and leasing losses. However, its commission income surged from 12.8 billion soums to 57 billion soums, driving overall profitability.

By early March, Tengebank's loan portfolio grew by 8.4% year-over-year to 4.5 trillion soums, although the share of non-performing loans increased from 2.3% to 3.4%, highlighting emerging credit risk concerns.

Milliybank also posted strong results, with net profits reaching 603.2 billion soums, up 28.9% compared to the same quarter last year. Interest income grew 15% year-over-year to 4.7 trillion soums, though interest expenses stood at 2.5 trillion soums. Operating expenses rose by 26% to 673.1 billion soums, including 372.2 billion soums on employee wages. The bank contributed 22.5 billion soums in income tax during the quarter.

Kapitalbank reported a net profit of 324.8 billion soums, with assets rising to 58.23 trillion soums. Credits and leasing operations represented the largest asset segment at 36.6 trillion soums, remaining the main growth driver. Interest income totaled 1.85 trillion soums with non-interest income close behind at 1.64 trillion soums. Expenses included 1.07 trillion soums in interest costs and 648.6 billion soums in non-interest costs, with operating expenses at 715.7 billion soums—269.8 billion soums of which covered employee salaries.

Hayotbank recorded a net profit of 14.6 billion soums amid asset growth to 7.43 trillion soums. Loans and leasing formed the major component with 5.63 trillion soums. Interest income reached 332.5 billion soums, complemented by non-interest income of 87.2 billion soums. The bank's interest expenses were 253.5 billion soums; non-interest expenses stood at 22.2 billion soums, and operating costs totaled 66.8 billion soums, with 41.6 billion soums allocated to staff wages.

Earlier reports also covered the performance of other banks such as SQB, KDB Bank, Universalbank, Turonbank, and Openbank, portraying a comprehensive view of Uzbekistan's evolving banking landscape.

The steady growth in assets, diversification in income streams, and cautious risk provisioning suggest Uzbek banks are adapting to a competitive and digitally evolving financial market. The rise in commission income highlights the sector's move toward fee-based services, possibly including digital payments and fintech partnerships, which are increasingly crucial in the global digital economy.

Based on reporting by Deutsche Welle.