APRIL 1 2014 (The Conway Bulletin) — The 20% devaluation of the tenge earlier this year will trigger an increase in bad debt, Roman Kornev, director of financial institutions at Fitch Ratings said. The Kazakh government wants to reduce the amount of non-performing loans on banks’ portfolios.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 178, published on April 2 2014)
APRIL 1 2014 (The Conway Bulletin) — Uzbekistan’s Central Bank ordered commercial banks to stop taking wire transfers from Russia’s Zolotaya Korona, threatening the country’s remittances lifeline.
Remittances are crucial to Uzbekistan. According to the World Bank, remittances from Russia account for roughly 16% of Uzbekistan’s GDP.
This figure, although, large still underplays the importance of remittances to the Uzbek economy.
They are an essential lifeblood to the much of the population, feeding entire families and beating away poverty.
It makes the unexplained announcement by the Uzbek Central Bank all the more puzzling. Zolotaya Korona, which means Golden Crown, is the most popular system for Uzbeks working in Russia to wire cash home.
Forcing users onto another system, creates an additional barrier.
A couple of days after issuing the ban, the Uzbek Central Bank said it banned Zolotaya Korona because it thought that it was in poor financial health.
Officials at Zolotaya Korona, which is based in the Siberian city of Novosibirsk, have declined to comment on the Uzbek Central Bank’s decision.
In January, around a dozen Azerbaijani banks cut their links to Zolotaya Korona. They said that deals with the Russian company just weren’t profitable enough.
In 2012, Armenia’s Central Bank banned Zolotaya Korona from operating there because it was stopping some people using its services.
Whatever the reason for the Uzbek Central Bank’s sudden ban on Zolotaya Korona, the poor in Uzbekistan will suffer.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 178, published on April 2 2014)
MARCH 25 2014 (The Conway Bulletin) — Halyk Bank, Kazakhstan’s second largest lender, said net profit rose by 3.5% to $398m in 2013, good news for the Kazakh finance sector. Importantly, also, Halyk Bank said the ratio of so-called non-performing loans had reduced slightly.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 177, published on March 26 2014)
MARCH 24 2014 (The Conway Bulletin) — The Uzbek government aims to stop cash leaving the country by forcing local companies to get written permission from the Central Bank before opening foreign bank accounts, media reported. Foreign companies have long complained that repatriating profits is a major problem for businesses in Uzbekistan.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 177, published on March 26 2014)
MARCH 17 2014 (The Conway Bulletin) — The International Monetary Fund (IMF) has thrown its support behind the Azerbaijani government’s order to banks to stop lending so much cash to consumers.. At a press briefing the IMF head in Azerbaijan, Raja Almarzoqi, said: “A decrease in the share of consumer loans would be beneficial.”
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 176, published on March 19 2014)
MARCH 6 2014 (The Conway Bulletin) — Looking to reduce bad loans, Kazakhstan’s Central Bank imposed tighter regulations on its banks’ lending. In a statement, the Central Bank said banks would be banned from lending to people whose repayments would equal half their monthly income. Nearly a third of all 90-day loans in Kazakhstan are overdue.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 175, published on March 12 2014)
FEB. 26 2014 (The Conway Bulletin) — British bank HSBC agreed to sell its banking assets in Kazakhstan to Halyk Bank for $176m.
HSBC Kazakhstan employed about 600 people and operated six branches in the country.
The deal is important for two reasons. Although left unsaid, HSBC’s move out of Kazakhstan feels like a fairly damming verdict on the Kazakh economy. After all, HSBC spent 15 year working in Kazakhstan.
Perhaps Kazakhstan is not as rosy economically as government ministers would like the public to think.
Secondly, Halyk Bank, the purchaser of HSBC’s banking assets, is owned by the Dinara Nazarbayeva and Timur Kulibayev, the daughter and son-in-law of Kazakh President Nursultan Nazarbayev.
HSBC has generally had a re-think across the globe on its banking strategy. It pulled out of Russia in 2011 after only two years.
For Halyk Bank, the deal is something of a coup. Halyk Bank refused to buy the government’s stake in debt-ridden BTA Bank at the end of 2013, showing its independent thinking.
For Kazakhstan’s banking sector, the deal marks another round in the consolidation process. It also leaves Citi as the only Western bank with a major presence. All eyes are now on Citi and how long it lasts.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 174, published on March 5 2014)
FEB. 20 2014 (The Conway Bulletin) — Kaspi Bank’s chairman, Mikhail Lomtadze, said customers withdrew 40b tenge ($216m) from their accounts after SMS messages wrongly claimed the Kazakh bank was going to collapse after the devaluation of the Tenge earlier this month. Mr Lomtadze said this equalled roughly a tenth of all the savings in Kaspi Bank.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 173, published on Feb. 26 2014)
FEB. 17 2014 (The Conway Bulletin) — ATF Bank, bought by Kazakh investors from Italy’s Unicredit in 2013, made a profit last year for the first time since 2007, media reported. ATF Bank said it made a profit of $9.7m in 2013. The bank is now officially owned by Galymzhan Yessenov, son-in-law of the Almaty’s mayor Akhmetzhan Yessimov.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 172, published on Feb. 19 2014)
FEB. 17 2014 (The Conway Bulletin) — Kenes Rakishev, closely linked to members of the Kazakh elite, officially became chairman of BTA Bank. In December, Mr Rakishev agreed a deal worth nearly $1b with Kazkommertsbank to buy a 93% stake in BTA Bank from the government. BTA Bank, whose former chairman is Mukhtar Ablyazov who allegedly embezzled billions from the bank, has a high proportion of non-performing loans.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 172, published on Feb. 19 2014)
