Kyrgyzstan's banking sector demonstrated steady growth in 2024. According to the National Bank, the assets of commercial banks increased by 32.8%, reaching 815.7 billion KGS. This growth reflects the expansion of financial intermediation and rising confidence in banking institutions.

By the end of the year, 21 commercial banks were operating in the country with a network of 304 branches, five of which offered services in accordance with Islamic finance principles.

The net profit of the banking system amounted to 31.1 billion KGS, which is 28.5% higher than the previous year's figure of 24.2 billion KGS. This result highlights the resilience of the banking sector and its ability to generate income even amid a changing macroeconomic environment.

Key trends: growth in assets and lending

A significant increase has been observed in the banking sector's loan portfolio, which grew by 32.2% to reach 340.7 billion KGS. Notably, consumer loans saw a remarkable increase of 77.8%, rising to 99.2 billion KGS. Mortgage lending also grew by 30.5%. This indicates a high demand for housing and active bank participation in its financing.

At the same time, Islamic financing is also demonstrating steady growth. Its volume increased by 49.3%, reaching 9 billion KGS, with the most significant growth observed in the mortgage segment (+213.9%) and in agriculture (+109.5%).

At the same time, consumer financing based on Islamic principles decreased by 37%, reflecting changes in the demand structure for credit products.

The liabilities of the banking sector have increased by 34.3% since the beginning of the year, reaching 684.9 billion KGS, while the deposit base has grown by 37.3%, totaling 592.4 billion KGS.

The growth in deposits has been driven by all categories of clients, but the most significant increases were shown by financial and credit organizations (+341.7%) and legal entities (+50.5%), indicating an increase in liquidity and trust in the banking system.

Financial stability and liquidity

Kyrgyzstan's banking system continues to demonstrate resilience despite an increase in the share of classified loans to 10.8% of the total portfolio. At the same time, the level of overdue debt has decreased by 0.5%, totaling 1.9%, which indicates sound risk management and effective debt collection efforts.

One of the key trends remains the reduction of dollarization. The share of foreign currency loans has decreased to 20.1% (-2 percentage points), while the share of foreign currency deposits has fallen to 42.9% (-2.7 percentage points), reflecting both a decrease in dependence on foreign currency and an increase in confidence in the national currency.

The financial stability of the sector is supported by an increase in capital. The net total capital rose by 24.8%, reaching 132.6 billion KGS, while the capital adequacy ratio remained at a comfortable level of 22%, almost double the minimum set by the regulator (12%). The liquidity ratio stood at 73.1% (compared to 77.4% the previous year) against a standard of 45%, confirming the high solvency of the banking system.