Bloomberg News

Kazakhstan’s Alliance Bank Swung to Capital Surplus in 2011

April 11, 2012

State-run Alliance (ASBN) Bank, the first Kazakh lender to default in 2009, said it rebuilt a capital surplus last year and predicts profit will reach 2 billion tenge ($13.5 million) in 2012.

Alliance had a surplus of 1.32 billion tenge, the Almaty- based lender said in a statement today, citing consolidated data calculated in accordance with international financial reporting standards. Its capital shortage was 105 billion tenge in 2010.

Kazakhstan’s sovereign wealth fund Samruk-Kazyna holds the government’s 67 percent stake in Alliance and 79.9 percent in Temirbank after they were brought under state control in 2009. The fund is discussing a merger of the two lenders, which issued new bonds and offered shares and cash to creditors in 2010 after writing off and extending payments on some of their debt.

Net income was 39.9 billion tenge in 2011, compared with the 334 billion tenge it earned after undergoing a debt restructuring in 2010, Alliance the bank said. The bank forecasts profit of about 2 billion tenge this year, Chief Executive Officer Maksat Kabashev told reporters in Almaty today. Assets rose to 530 billion tenge from 428 billion tenge.

Bad Loans

Alliance plans to move as much as 50 billion tenge of bad loans to a subsidiary it plans to create in May to manage souring debt, Kabashev said. The transfer will help the lender collect non-banking income and allow the release of 50 percent of the provisions set aside to cover those loans, he said.

Kazakh President Nursultan Nazarbayev yesterday told government and central bank officials to stabilize Alliance and BTA, two of the defaulted lenders brought under state control in 2009. While Alliance’s future was discussed, the situation there is “quite normal,” central bank Chairman Grigori Marchenko said today. Talks on BTA were related to its second debt restructuring, Marchenko said, without elaborating.

Alliance plans to resume negotiations on selling a stake of as much as 25 percent to the European Bank for Reconstruction and Development, depending on the bank’s capital surplus, Kabashev said Jan. 11.

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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