On 10 December the commercial
bank Halyk Bank (Halyk Savings Bank of Kazakhstan – Қазақстан Халық Жинақ Банкі
АҚ), the country’s second-largest bank in terms of assets, communicated to the
Kazakhstan Stock Exchange (KASE) that, having obtained the approval of the national
financial supervisory authority (KFN), the bank intends to carry out a 1:10
split in its common stock, increasing the number of its common shares from
2,400,000 to 24,000,000 shares. The bank
intends to carry out the split after the close of the trading day on the
exchange on Friday, 14 December.
On 11 December it
was announced that Halyk Bank had officially informed the Kazakhstan Stock
Exchange that on 6 December the rating agency Moody’s had updated its
ratings for Halyk Bank and the Eurobonds issued by the bank. In its updated credit opinion Moody’s assigned
to Halyk Bank a bank financial strength rating (BFSR) of D-, a global local
currency (GLC) deposit rating of Ba2, and an outlook of “Stable”.
Sources:
Press release about stock split: АО "НАРОДНЫЙ СБЕРЕГАТЕЛЬНЫЙ
БАНК КАЗАХСТАНА" НАМЕРЕНО 14 ДЕКАБРЯ ПОСЛЕ ЗАКРЫТИЯ ТОРГОВ НА KASE
ОСУЩЕСТВИТЬ ДРОБЛЕНИЕ СВОИХ ПРОСТЫХ АКЦИЙ В ПРОПОРЦИИ 1 К 10 (2012-12-10 18:00 )
Press release with link to Moody’s Investors Service
credit opinion report in English (8 pages) accompanied by transmission cover
page from Halyk Bank in Russian (1 page): АО "Народный сберегательный
банк Казахстана" сообщило о подтверждении агентством Moody's Investors
Service рейтинговых оценок банка и его еврооблигаций (2012-12-11 17:56 )
On 10 December the
troubled commercial bank BTA Bank («БTA Банкi» АҚ) issued a communiqué
informing its creditors and all other interested parties that the bank’s
application for approval of a restructuring plan is due to be
considered at a hearing of the Specialized Financial Court of Almaty (Специализированный
финансовый суд города Алматы (далее – СФСА)) on 12 December at 10:00, on the
fifth floor of the court’s premises at 34 Markova Street, Almaty.
Source:
АО
"БТА Банк" (Казахстан) сообщило о судебном слушании для утверждения
плана реструктуризации банка (2012-12-10 18:09 )
Also on 10 December,
the management of Nurbank («Нұрбанк» АҚ), Kazakhstan’s thirteenth-largest bank
in terms of assets (with total assets as of 30 Sept. 2012 of 269 bln KZT, i.e.,
€ 1.40 bln), announced that it had succeeded in selling off 47.3 bln KZT (€ 241
mln) of bad and doubtful assets to outside firms unrelated to the bank.
In its press
release, Nurbank stated that this is the largest sell-off of troubled assets to
be carried out to date by a bank in Kazakhstan, and that it differs from the
usual way of handling troubled assets in Kazakhstan’s banking sector in that it
did not involve the transfer of troubled assets to specially established
subsidiaries (SPVs) but instead consisted in the sale of the assets to
collection firms unrelated to the bank.
Source:
АО
"Нурбанк" (Казахстан) сообщило о продаже своих безнадежных и
сомнительных активов корпоративного портфеля на сумму 47,3 млрд тенге
(2012-12-10 16:18 )
Finally, on 10
December the National Bank of Kazakhstan Kazakhstan
The banking sector remains
vulnerable and credit growth is moderate. While liquidity and capitalization are high and profitability is
showing signs of improvement, non-performing loans (NPLs), at over 30 percent
of total loans, remain extremely elevated. Credit growth is constrained by
limited lending opportunities against the backdrop of stricter prudential
regulations. Moreover, credit is concentrated in selected small- and
medium-sized banks, while large banks continue to deleverage. BTA’s second
proposed debt restructuring has been agreed by the creditors. The restructuring
will need to be complemented by a viable business plan, including measures to
strengthen the bank’s risk management and to minimize contingent liabilities to
the state.
Efforts to address the
stock of NPLs are progressing, but with limited impact so far. Currently, the policies comprise of three
instruments: sale of some non real-estate bad loans to the National Bank of
Kazakhstan’s (NBK) problem loans fund (PLF), transfer of loans to bank-run
Special Purpose Vehicles (SPVs), and writing off loans without tax consequences
(currently applied through December 2013). The PLF has started to buy loans on
a pilot basis and some banks have begun to set up SPVs. The package of measures
is a step in the right direction. However, many obstacles remain and progress
has been slow: according to the authorities the measures will take at least 2-3
years to fully resolve the problem. Obstacles reflect difficulties in
implementing the required legal and tax reforms, banks’ unwillingness to sell some
of their assets in the expectation of a price recovery, and the complexity of
the loan restructuring process. In view of the risks to financial stability and
economic growth, the authorities should: (i) do their utmost to expedite the
process by addressing remaining constraints and encouraging banks to take
speedy action; (ii) ensure realistic valuation of assets transferred to SPVs
and prevent circumvention of prudential regulations; and (iii) re-assess the
PLF’s design depending on its performance.
Looking ahead, it is
essential to avoid a recurrence of the problem. In this context, the authorities have introduced
several prudential regulations and plan to adopt elements of Basel III in 2013,
while banks report a strengthening in their risk management and lending
practices. Nevertheless, further work is urgently needed to strengthen bank
supervision, in particular to bolster on-site inspection and ensure that banks
have viable business plans. Moreover, macro prudential surveillance and the
infrastructure for minimizing credit risk need to be enhanced, in particular by
strengthening banking sector liquidity and indirect credit risk assessments,
the Early Warning System, and the credit registry. The IMF stands ready to
provide technical assistance in these areas, including through an
already-assigned long-term expert on NPLs within the NBK.
[...]
Sources:
Official IMF text: Republic of Kazakhstan
– Concluding Statement of the 2012 IMF Staff Visit (2012-12-10)
National Bank of Kazakhstan
Mark Pleas
[contact]
