The European Times 

National Bank Chairman Reports Impressive Banking-Sector Growth Rates 

Zina Mukaevna Asankojoeva, Chairman of the National Bank of the Kyrgyz Republic, discusses recent developments in the country’s banking sector. 

Zina Mukaevna Asankojoeva, Chairman National Bank 

European Times: Can you give an overview of the Kyrgyz Republic’s banking sector? 

Zina Asankojoeva: There are now 22 commercial banks in the Kyrgyz Republic, in 14 of which foreign capital is represented, and we have an extensive network of more than 860 bank branches located in all regions of the country. Foreign banks in our market include subsidiaries of such banks as UniCredit Group (Italy), Halyk Bank (Kazakhstan) and Kazkommertsbank (Kazakhstan), as well as a branch of the National Bank of Pakistan. Overall, foreign participation in the capital of the Kyrgyz banking system totals 36% of all paid-up nominal capital. All banks are universal and provide a full range of services. 

European Times: What about banking assets and returns? 

Zina Asankojoeva: The Kyrgyz banking sector is stable and steadily developing, and has established a safety cushion to deal with potential internal and external shocks. Banking assets total around €1.3 trillion and grew by 16.5% in 2012, while the deposit base grew by 24.7% and the total loan portfolio grew by 14.2%. These growth rates demonstrate the great capacity of our banking system. Our non-banking financial segment, specifically micro-financing institutions, is also growing rapidly. 

European Times: What are some of the National Bank’s current projects? 

Zina Asankojoeva: One of our current projects is to develop a new banking code, which should be finalised in 2013. The code will strengthen the legal framework for banking in the country, eliminate any inconsistencies and contradictions, institute clearer legislation, and define legal relationships in the banking sector. We have almost finished a big initiative to bring Kyrgyzstan’s payment system up to international standards. The National Bank is also one of the key players in the government’s programme to increase the share of non-cash payments and settlements, and we are playing a leading role in combating money-laundering and terrorism-financing. 

European Times: What are the National Bank’s priorities for the next five years? 

Zina Asankojoeva: Our main goal, as the country’s central bank, is to maintain inflation at single-digit levels in the medium term through following an appropriate monetary policy. Other key tasks include developing financial markets, promoting increased competition in the banking sector, and strengthening our financial sector overall. 

European Times: Why should international financial-sector investors choose the Kyrgyz Republic? 

Zina Asankojoeva: Our country’s legislation meets international standards, including the possibility for free movement of capital and a lack of restrictions on the volume of foreign-currency transactions and conversion deals. We have relatively small requirements of around €10 million for initial capital formation, and the Kyrgyz Republic offers quite high returns on investment.