Kazakhstan to consider Foreign Borrowing Caps - Kelimbetov
Kazakhstan will decide in May or June whether to introduce caps on foreign borrowings as the country seeks to increase oversight over its banking sector, the head of Kazakh state holding and investment company Samruk-Kazyna Kairat Kelimbetov said last week.
“Under a concept proposed [by the government and regulators] external borrowings will be monitored closely and limited,” Kelimbetov told journalists.
The regulators will monitor not just the amount of foreign borrowing but also its allocation, Kelimbetov said, to discourage excessive lending in bubble-prone sectors like real estate or finance.
Kelimbetov also said that the restructuring of BTA Bank’s debt was expected to be completed this summer. Analysts see the debt restructuring of Kazakhstan’s once largest bank as a precondition to resolving the ongoing malaise in the country’s banking sector.
BTA’s restructuring is also expected to pave the way to its takeover by Russian largest lender, the state-owned Sberbank.
“The creation of mutual Russo-Kazakh bank will be the most concrete example of integration and cooperation between the two countries,” Kelimbetov said.
Kelimbetov said he expects Kazakhstan’s banking sector to regain its pre-crisis luster by 2012-13.
“I expect that real prices for the banking assets in Kazakhstan will return to multiples of two, three, four to book value — the prices we saw before the crisis — in 2012-2013,” he said, according to SRI.