Ipoteka Bank Raises $400 Mln Through Eurobonds
Ipoteka Bank OTP Group has placed two tranches of Eurobonds – US$300 mln with a five-year maturity and UZS 1.2 trillion (US$100 mln) with a three-year maturity. The deal was announced on 10 October in Tashkent during a presentation at the InterContinental Hotel, where the management outlined the objectives of the issuance and the bank’s future development plans. Kursiv Uzbekistan reviews how the bank intends to allocate the funds, how it managed to reduce borrowing costs, and what its growth strategy for the next four years looks like.
Rates and Background
The coupon rate of 6.45% on the dollar-denominated bonds is the lowest since 2021 among issuers in the CEEMEA region with comparable credit ratings and issuance volumes. The soum-denominated Eurobonds were placed at a record-low rate of 17.5%. Yields on both tranches were reduced by 37.5 basis points from the initial guidance. The rate on the soum bonds is only 2% higher than the risk-free rate on Uzbekistan’s medium-term government bonds. Typically, non-state entities in the country face significantly higher premiums, with rates reaching up to 29%.
The bank’s management attributes this reduction in borrowing costs to growing investor confidence in Ipoteka Bank and the strong demand for its securities. Demand for the dollar bonds exceeded supply by 2.8 times, while the soum bonds were oversubscribed by 3.4 times.
The transaction was arranged by global institutions including J.P. Morgan, Citi, Société Générale and OTP Bank, with support from Bank of China and Mashreq.
In an interview with Kursiv Uzbekistan, Sandro Rtveladze, Chairman of the Management Board of Ipoteka Bank OTP Group, said that around half of the placement volume came from US pension funds and asset management companies, approximately 30% from European investors, and the remainder from participants in other regions. According to him, the bank does not expect high secondary market liquidity for these bonds, as institutional investors generally prefer to hold such reliable instruments for the long term.
Irakli Elashvili, Deputy Chairman of the Management Board of Ipoteka Bank, noted the strong interest of international investors in Uzbekistan’s unique economic transformation, as well as the European-level standards of transparency and operational excellence that Ipoteka Bank continues to demonstrate.
In his speech, he added that the bonds were listed on the Vienna Stock Exchange, and the proceeds will be channelled into Uzbekistan’s thriving economy and the bank’s continued growth.
Moving to the Next Level
Hungary’s OTP Group acquired a controlling stake in Ipoteka Bank in June 2023. Since then, the total loan portfolio of Uzbekistan’s banking sector has grown by 34% through to May 2025 (nearly two years), while Ipoteka Bank’s portfolio expanded by 6.5%.
«Following the acquisition, significant investment was directed towards building the necessary infrastructure — decision-making systems, a call centre, and a processing centre. OTP typically refrains from aggressive growth until all core infrastructure is in place. Around US$50 mln has been invested over the past two years,» Rtveladze told Kursiv Uzbekistan.
He emphasised that the bank is now entering its next phase. The proceeds from the bond issuance will primarily be used to expand corporate lending (small and medium-sized enterprises) and retail banking.
In the third quarter of 2025, the bank recorded positive financial results not only under IFRS but also under NAS, achieving a net profit of UZS 102.5 bn. This reflects the ongoing changes as the bank continues to clean up non-performing assets, enhance business processes, and shift into a growth phase.
Long-Term Goals and the Path of Transformation
In his address on 10 October, Sandro Rtveladze stressed that the bank’s current stage of development represents a natural continuation of the fundamental transformation that began immediately after joining Hungary’s OTP Group. According to him, the bank’s strategy spans six years and comprises three key cycles, each lasting around two years.
«The first cycle focused on improving infrastructure and lending processes. Over the past two years, we have invested tens of millions of dollars solely into IT infrastructure. The second stage begins now — it is centred on strengthening the bank’s position in the transactional services market. The third cycle will complete the transition towards becoming a ‘primary bank’ — the one clients use most frequently, combining innovative services and ecosystem-based solutions,» he explained.
Rtveladze highlighted that successful transformation is a long-term process requiring substantial investment and patience. Equally important, he said, is the team itself. Over the past two years, Ipoteka Bank’s workforce has undergone significant renewal, with around 500 new specialists joining, including 100 expatriates from ten different countries.
«Transformation is not just about fixing processes,» he noted. «It is about changing corporate culture, introducing innovation, and reshaping the fundamental approach to business.»
The executive added that the stage of ‘process correction’ has already been completed, and the bank is now entering a full-scale transformation phase that lays the groundwork for long-term impact.
«In Uzbekistan, some sectors are growing by 50–60% a year, so we must be able to adapt quickly,» he said. «We are building systems that can rapidly adjust to new realities and the challenges that come with a fast-growing economy.»
Another hallmark of OTP Group’s approach is its adaptive strategy. As Rtveladze explained, the bank reviews its priorities every six months and adjusts its strategy as needed to respond swiftly to market developments.
