Bloomberg News

Kazakhstan Discusses Merger Between Temirbank, Alliance Bank

February 07, 2012

(Updates with Bakhmutova’s comment in fourth paragraph.)

Feb. 7 (Bloomberg) -- Kazakhstan’s sovereign wealth fund Samruk-Kazyna is discussing a possible merger of state- controlled lenders AO Temirbank and AO Alliance Bank, said Yelena Bakhmutova, the fund’s deputy chief.

Samruk-Kazyna, which holds government stakes in the banks, is considering options to “boost the lenders’ effectiveness, including the possibility of their functioning as a united financial institution,” Bakhmutova said in an interview with the Interfax news service in comments confirmed by the Astana- based fund’s press service.

Temirbank, Alliance Bank and BTA Bank, the country’s biggest at the time, were brought under state control in 2009, when credit markets froze and Kazakhstan’s property bubble burst. The banks issued new bonds and offered shares and cash to creditors in 2010 after writing off and extending payments on some of their debt. BTA is seeking to restructure its debt for the second time.

“Talks with Alliance and Temirbank creditors must be held before any decisions are made,” Bakhmutova said.

The government owns 81.48 percent of ordinary shares in BTA, 67 percent in Alliance and 79.9 percent in Temirbank, according to the Kazakhstan Stock Exchange website.

Samruk-Kazyna abandoned the possible sale of Temirbank because of the low chances of finding a buyer amid difficulties faced by leading financial companies, Bakhmutova said.

Kazakh state officials held talks on selling a stake in Alliance to the European Bank for Reconstruction and Development in April last year, which would have made it the first of the country’s defaulted banks to attract an international institutional investor, people familiar with the talks said at the time.

--Editors: Paul Abelsky, Alan Crawford

To contact the reporter on this story: Nariman Gizitdinov in Almaty at ngizitdinov@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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