Kazakhstan Wants Foreign Companies to Bank Locally
The Kazakh government plans to introduce a requirement for foreign companies working in the oil-rich Central Asian country to keep money with local banks, Prime Minister Karim Masimov said on Thursday.
Global confidence in Kazakh banks has been shaken by the defaults of three local lenders this year, including BTA , once Kazakhstan's largest bank.
Analysts say it will take years for banks to regain full access to international capital markets.
The planned measure could boost the banking system's liquidity -- at the cost of foreign firms.
'I think that foreign companies working in Kazakhstan should keep a part of their resources in Kazakh banks,' Masimov told a business conference, adding that local subsidiaries of global banks such as Citigroup and HSBC would also be considered Kazakh.
'I personally think this is an honest and fair position,' he said.
Masimov provided no details of the proposed regulation. Kazakhstan has attracted billions of dollars in foreign investment since gaining independence in 1991, mostly into its oil and gas sector, according to Reuters.