1. Retail Banking in Uzbekistan:
People’s Bank Case
Sakhi Annaklichev
Deputy Chairman
People’s Bank of Uzbekistan

2. Key Drivers of Retail Banking
Constant innovation in banking sector
Rapid advances in information technology
Evolving macroeconomic environment
Financial markets reforms
Increased competition from non-banking sector
Transformation from the “seller’s market” to the “buyer’s market”

3. Retail Banking: Features
Center Focus: Individual Customers
3 basic characteristics:
multiple products (deposits, credit/debit cards, investments and securities);
multiple channels of distribution
(call centre, branch, Internet and kiosk); and
multiple customer groups (consumer, small business, and corporate).

4. Profile of Retail Banking in Uzbekistan
Retail banking in Uzbekistan shows consistent growth
During 2011 retail loans grew by 42,35% and retail deposits by 32%
Retail loans level reached 1,7 trln. Soums in 2011, making up 17% of the total loan portfolio
Retail deposits size increased to 2,87 trln. Soums
Time deposits are gaining higher shares

5. People’s Bank Competitive Position
No. 5 by asset size
No. 4 by owners’ equity
No. 1 by retail deposits mobilized, with total market share of 23,5%
No.1 by retail client base
No.1 by number of branches

6. People’s Bank: At a Glance
Founded as a savings institution in 1875 in Tashkent
1995 – Reorganized from the Savings Bank of Uzbekistan into the State Commercial People’s Bank of Uzbekistan
Status: joint-stock holding company
Shareholders: Ministry of Finance (51%) and the Central Bank of Uzbekistan (49%)
Agent of the Government in implementing social projects and reforms (managing mandatory and cumulative Pension funds systems, distributing the growth of population welfares).

7. People’s Bank Mission
The mission of the People’s Bank determines the nature and meaning of the Bank, underlining its role as of a financial agent of the Government in the implementation of social objectives, as well as ensuring the growth of the welfare of the people and the economy as a whole.
People’s Bank possessing the largest network of branches in Uzbekistan. is always closer to each of a client in every city, district and village.

8. Facts about the People’s Bank
Standard & Poor's Ratings Agency affirmed 'B+' long-term and 'B' short-term counterparty credit ratings with Stable outlook.
As of 1 January 2012:
Total Assets = 1,62 trln soums
Deposits = 1,27 trln soums
Loans = 755 bln soums
Authorized capital 200,0 bln soums; paid up capital: 180,0 bln soums.

9. Facts about the People’s Bank
Today People’s Bank is a universal banking organization providing all kinds of banking services ranging from issuing loans and accepting deposits, issuing letters of credit and servicing individual cross border remittances.

10. Corporate Structure “Xalq Insurance” PEOPLE’S BANK “Xalq Invest”
“Xalq Lizing”
Retail Banking
Corporate Banking
Accumulated Pension System
Conductor of Social Programs
Regional Branches (14)
District Branches (175)

11. Distribution Channels of the Bank’s Retailing
Retail Banking
Regional/District Branches
(199)
Minibanks (271)
Savings offices (1963)
Specialized cash collecting/dispensing offices (1093)
Money order offices (191)
FX offices (260)
Mobile service points (72)

12. Bank’s Retail Operations
Microinsurance
Loan loss insurance
Property insurance
Debit Cards: “UZCART”; VISA
UzPaynet
Internet-banking
Mobile-banking
Demand
Time
Savings
Lottery deposits
Mortgage
Auto
Personal
Education
Others
Loans
Deposits
Insurance (Xalq Sugurta)
Retail Payment Systems

13. Main Figures

14. Main Figures

15. Modern Retail Services
«Uyali pul» - a complete solution that ensures a convenient and secure e-service retail bank customers using the Internet and mobile phones. The Bank offers a comprehensive solution that allows you to almost completely satisfy all customer needs in a remote service.
UZPAYNET - non-banking on-line payment system that provides people through its more than 25,000 agent points with services for making payments for utilities, cell and land-line phones, Internet and IP-telephony, and many other, in the real time mode 24/7

16. International Activities
In 2000 the People’s Bank became a Member of the World Savings Banks Institute the global representative of savings and retail banking.
WSBI represents savings and socially committed retail banks or associations thereof in 89 countries. WSBI works closely with international financial institutions and represents its members’ interests at an international level.

17. International Activities
Since 2003 the Bank has been actively involved in micro-financing project with German Savings Bank Foundation for International Cooperation. The Bank has utilized credit line of the Foundation as the result new jobs were created as a result of this project over 100 specialists of the People’s Bank were trained by the experts of financial institutions in Germany.
As part of cooperation between the Foundation and the People’s Bank several other projects are being currently implemented. Among them is the micro-insurance project, which is aimed at providing insurance in rural areas of the country.

18. International Activities
Areas of cooperation:
Short-term training courses for People’s Bank personnel:
savings
IT technology
micro-loans
treasury
card business
risk management
Technical assistance in developing International money transfer (remittances) from Korea – Uzbekistan – Korea

19. Challenges
Diminishing margins due to intense competition from non-traditional retailers and other new market players
Tightened Regulation: change in risk attitude, priority of safety and soundness, entrenching line of defense of bank clients
Policy issues: financial inclusion, consumer protection, access to finance, responsible lending, prevention of financial crime (AML)
Retention of customers
Concerns for safety with IT development

20. Perspectives
Rise in the middle class: ever increasing of the purchasing power, liberal attitude to personal debt
Building a unified IT environment:
“branchless” banking
e-banking
consolidation of various operations
Deepening of product development and differentiation

21. THANK YOU!