Tag Archives: banking

Kazakh and Azeri VTB change directors

MARCH 14 2016 (The Conway Bulletin) – The Azeri and Kazakh subsidiaries of Russian bank VTB changed their directors. In Azerbaijan, Vugar Ismayilov left his post of deputy chairman after seven years. In Kazakhstan, Mikhail Oseyevski substituted Mikhail Yakunin as chairman after Mr Yakunin left the bank to join the Russian National Commercial Bank, formerly owned by the government of Crimea, now property of the Russian government.

ENDS

(News report from Issue No. 272, published on March 18 2016)

Editorial: NPLs in Kazakhstan

MARCH 11 2016 (The Conway Bulletin) – Women banging pots, blowing whistles and wearing grey capes in the streets of Almaty last January alarmed observers.

They were protesting about mortgages and how difficult it was to repay these loans after a devaluation of the tenge. In other words, this was yet another alarm bell about non-performing loans in Kazakhstan.

The country was battered with toxic loans in the aftermath of the Global Financial Crisis of 2007/8 and some banks, directly or indirectly, asked for help from the government.

And the government has only just started to offload these banks — think BTA and Kazkommertsbank’s merger last year.

Now, though, new data suggests that there may be another round of dodgy debt to deal with. This time the government needs to act early to stop borrowers from tipping the fragile banking system into the red again. It has the funds and it now also has the experience. This time round, there are few excuses for the Kazakh government and the Central Bank.

ENDS

(Editorial from Issue No. 271, published on March 11 2016)

S&P downgrades Kazakhstan’s Baiterek

FEB. 26 2016 (The Conway Bulletin) – Ratings agency Standard & Poor’s downgraded the credit ratings for Baiterek Holding from BBB-/A-3 to BB+/B. S&P said “the likelihood of extraordinary government support to the consolidated Baiterek group [is] almost certain”. It said its negative outlook mirrors that of the agency’s latest assessment of Kazakh sovereign credit. Baiterek’s subsidiaries include the Development Bank of Kazakhstan and the Investment Fund of Kazakhstan.

ENDS

(News report from Issue No. 270, published on March 4 2016)

Moody’s downgrades Uzbek Khamkorbank

FEB. 26 2016 (The Conway Bulletin) – Rating agency Moody’s cut Khamkorbank’s long-term local currency deposit rating to B2 from B1. In February, the Uzbek Central Bank suspended the bank’s licence to trade foreign currencies for six months. The World Bank’s IFC and the Netherlands’ state-owned FMO own stakes in Khamkorbank.

ENDS

(News report from Issue No. 270, published on March 4 2016)

Business comment: Commodity slump hits richest

MARCH 4 2016 (The Conway Bulletin) — “Net worth” might not be hard data, but it’s still a decent indication of just how hard the economic downturn and the fall in commodity prices have hit Kazakhstan.

The owners of Kazakh miner ENRC lost a total of $1.8b in net worth in 2015, according to Forbes’ 2016 Billionaires list, showing the economic collapse that has hit Kazakhstan.

Aleksander Machkevich, Patok Chodiev and Alijan Ibragimov, the “Kazakh Trio,” lost around $600m each in 2015.

ENRC de-listed in London in November 2013 after disputes in the board and fraud investigations. The Kazakh Trio owns Eurasian Resources Group, a Luxembourg- based holding that owns ENRC.

Mr Ibragimov is the only member of the Trio registered in Kazakhstan.

Other members of the exclusive Kazakh billionaire club who have seen their fortunes dip include Dinara Kulibayeva, President Nursultan Nazarbayev’s daughter, and her husband Timur Kulibayev, each valued at $2b in 2015, down from a valuation of $2.1b in 2014.

Kazakhstan’s richest man, Bulat Utemuratov, fell 57 places in Forbes’ ranking. Mr Utemuratov is now the 771st richest man in the world, at $2.3b.

Finally, Forbes said that Vladimir Kim, who owns one-third of KAZ Minerals, saw his net worth decline from $1.8b to $1.5b.

Overall, the top five business people in Kazakhstan are worth $1.5b less than last year, that’s a 14% cut.

If the depreciation of the tenge has badly hit ordinary consumers and savers in Kazakhstan, the commodity slump remains the biggest headache for the high-flying business people.

ENDS

(News report from Issue No. 270, published on March 4 2016)

Uzbekistan suspends Khamkorbank

FEB. 16 2016 (The Conway Bulletin) – Uzbekistan’s Central Bank said it had suspended commercial lender Khamkorbank’s licence to trade in foreign currencies for six months due to unspecified violations of banking rules. The World Bank’s IFC and the Netherlands’ state-owned FMO both own stakes in Khamkorbank, 14.5% and 15% respectively.

ENDS

(News report from Issue No. 268, published on Feb. 19 2016)

Azerbaijani bank declares bancruptcy

FEB. 8 2016 (The Conway Bulletin) – Texnikabank became the fourth commercial bank in Azerbaijan to declare bankruptcy since the Central Bank started to withdraw licences from those banks it considers to be too small or weak. The Central Bank has previously said that people with savings of up to 30,000 manat ($19,000) will be fully compensated if their savings bank goes bankrupt. In January, Azerbaijan withdrew the licence for at least eight banks to operate because they fell below the required minimum capitalisation limit. Those banks have been choosing whether to merge or to go bankrupt since then.

ENDS

(News report from Issue No. 267, published on Feb. 12 2016)

Stock market: Bank of Georgia, Tethys, Centerra

FEB. 5 2016 (The Conway Bulletin) — Bank of Georgia shares were up 6.9% this week, closing at £18.14 on Thursday. The bank has followed a downward trend since the beginning of the year, but news of the merger between its corporate banking and investment management departments lifted its shares.

BGEO Group, the holding that owns Bank of Georgia, said it is confident that the move will boost returns and reduce risk.

Tethys Petroleum shares jumped by 19.7% to 2.25p off the back of stable oil prices, leading an upbeat crowd of oil and gas companies involved in the region. Only Nostrum continued the slump.

Among miners, Centerra Gold posted a significant jump of 7.2% to 6.73 Canadian dollars after the Mongolian parliament unblocked negotiations over ownership and licences linked to one of their gold mines in the north of the country.

ENDS

(News report from Issue No. 266, published on Feb. 5 2016)

Kazakh bank sells shares

FEB. 5 2016 (The Conway Bulletin) — Kazkommertsbank, one of Kaza- khstan’s largest lenders, said it sold the 99.4% stake it owned in BTA Bank to Kenes Rakishev, Nurzhan Subkhanberdin and other minority shareholders. The total cost of the transaction amounted to around 6.1m tenge ($16,200). Mr Rakishev and Mr Subkhanberdin now each own 49.18% in BTA. Both are also major shareholders in Kazkommertsbank.

ENDS

(News report from Issue No. 266, published on Feb. 5 2016)

Kazakh mortgage holders protest

FEB. 2 2016 (The Conway Bulletin) – Around 50 mortgage holders protested in Almaty because they said it was not possible to repay their debt after a devaluation of the tenge. This was the third protest by mortgage holders against banks this year, a rare sustained level of public discontent in Kazakhstan. The tenge has lost around 50% of its value. Last year, the Kazakh government gave banks $130m to refinance mortgages but protesters have said that more needs to be done. Analysts have said that one of the biggest issues the Kazakh government faces is growing consumer debt.

ENDS

(News report from Issue No. 266, published on Feb. 5 2016)