One such player that has already thrown its hat into the ring is TBC Bank, Georgia’s largest lender. CFO Giorgi Shagidze agrees that the bank’s hard-won experience in its home market will give it a competitive edge in Uzbekistan. “The current reform drive in Uzbekistan resembles that of Georgia,” he told Euromoney.
“We went through this and gained very strong knowledge and capabilities that we can bring to the Uzbek market. We can act as a catalyst for the Uzbek banking sector.” TBC plans to enter Uzbekistan with Space, a mobile-only brand launched by the bank in Georgia last summer – although Shagidze says the Uzbek version will have a physical presence in the form of “next-generation” branches.
He adds that the lender, which is expected to launch early in 2019, will steer clear of Uzbekistan’s complex corporate sector and focus on retail, micro and SME customers. “We’re taking a very asset-lite, scale-based approach,” he says.
Shagidze declines to be drawn on growth targets for TBC’s Uzbek subsidiary but note that the stock of retail lending in the country is low even by central Asian standards, at just 5% of GDP.
“Given the current reform momentum, we think the market will grow fairly fast,” he says. He admits that persuading Uzbeks to engage with the banking system will be a challenge but says that, again, TBC’s background will stand it in good stead. “There was a time when people in Georgia wouldn’t use banks for savings, but that has largely changed, partly thanks to our efforts,” he says.
“If we can leverage that experience and combine it with local expertise, we will be in a very strong position.”
TBC will face international competition in the form of Kazakhstan’s Halyk Bank, which is also expected to open an Uzbek subsidiary this year. The Kazakh market leader was forced to abandon an earlier venture in the country following the introduction of capital controls but is keen to return.