Issues of Bank Solvency in Uzbekistan: A Model-Based Comparative Analysis of Selected Banks

Banking system in developing and transition economies prone to vulnerability due to rapid systemic changes and reforms. Developing market principles penetare the banking system from different corners of transition background. Banking system of Uzbekistan is a central component of development-oriented transition reforms since separation from former Soviet Union. Progressive reforms and changing landscape in the global financial system bear considerable challenges for commercial banks, especially solvency and liquidity. Solvency has become a hard-to-solve issue in both developed and developing economies, while transition economies, including Uzbekistan, have a different scenario to tackle the problem. This article empirically analysed the solvency of selected banks through assessing the distance to bankruptcy via Altman's Z-score and Enyi's RSR models. Model estimations showed contrary financial positions in selected banks. Altman's model estimations revealed that selected banks are insolvent, while RSR model found banks financial healthy.