Factor Analysis-Based Model for Rating the National Financial Security

Rating the national financial security is a pressing concern in economic science and real-world application, as it necessitates a comprehensive assessment of various factors influencing the stability and resilience of the financial system. This paper proposes the utilization of factor analysis to identify the most significant elements influencing a country's financial security level. Twelve macroeconomic indicators are determined to be crucial components of financial security and form the basis of a linear regression model for rating the financial security index. The model is tested and used to create a financial security rating for ten CIS countries. A detailed analysis of the index is conducted using the Republic of Uzbekistan as an example. Positive and negative factors impacting the country's financial system development are identified, enabling the government to prioritize areas for stimulating economic growth and enhancing living standards. The developed model is recommended for periodic monitoring of a country's financial security, enabling comparisons with leading nations. The study results can serve as a foundation for formulating effective measures to reinforce the country's financial security and ensure sustainable development amidst global challenges and uncertainties.