Reserve requirements
Required reserves are funds deposited by commercial banks in a special account at the Central Bank. The Central Bank sets mandatory reserve requirements for commercial banks' liabilities in national and foreign currency. Required reserves are formed only in the national currency regardless of the currency of commercial banks' liabilities.
Averaging mechanism is applied in the formation of required reserves. That is, banks that comply with the procedure for calculation and formation of required reserves set by the Central Bank, as well as those that met the requirement for the average amount of required reserves in the previous period, have the right to apply the averaging ratio (the ratio varies between 0 and 1). The averaged part of the required reserves is held on correspondent accounts of commercial banks at the Central Bank.
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Reserve Requirement Ratios (from July 1, 2024) |
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Type of liabilities |
Reserve requirement normatives |
|
Deposits of legal entities and individuals in national currency |
4 percent |
|
Deposits of legal entities and individuals in foreign currency |
14 percent |
|
Averaging ratio |
1,0 |
Reserve Requirement Ratios (from 1994)
Commercial banks are required to maintain liquidity on their correspondent accounts at the Central Bank for 28 and 35 calendar days (based on the settlement period) at a level not lower than the averaged amount of their required reserves. This mechanism allows effectively managing the overall liquidity of the banking system and reducing short-term fluctuations in money market interest rates.
By changing the reserve requirement ratios, the Central Bank influences the credit activity of commercial banks and interest rates.
The Regulation "On Required Reserves of Commercial Banks Deposited with the Central Bank of the Republic of Uzbekistan"
