Samruk-Kazyna sells its stakes in four banks at a loss

February 27, 2014

ALMATY. Interfax-Kazakhstan

Samruk-Kazyna Sovereign Wealth Fund, a shareholder of the four banks – Alliance Bank, Temir, KKB and BTA Bank, is taking a loss on its sale of shares.

“The fund invested in the banks total nearly 332 billion tenge. The sale of the shares in BTA, Temir and partially Alliance Bank will bring more than 200 billion tenge. Another 70-80 billion tenge we will gain from selling our interest in Kazkommertsbank,” said the head of Samruk-Kazyna Umirzak Shukeyev in Astana on Thursday.

“The crisis was so deep, so it’s naive to assume that every penny will be returned back. We cover all the losses with our own funds and leave the National Fund intact and out of it,” said Shukeyev.

In 2009, the government adopted a crisis response program to support the national economy, which also included bailing out the five banks. Currently Fund Samruk Kazyna is the major shareholder of the four banks, which had faced liquidity shortage problems, and accordingly it owns 67% of shares in Alliance Bank, 18.3% in Kazkommertsbank, 79.88% in Temirbank and 97.26% in BTA Bank. Earlier Samruk Kazyna pulled out of Halyk Bank as its shareholder.

Earlier Kazkommertsbank and Kazakh businessman Rakishev were reported to have reached a final agreement to purchase a 46.5% equity stake each in BTA Bank from Samruk-Kazyna. A purchase price of 72.075 billion tenge or approximately $465 million is to be paid by Kazkommertsbank for a 46.5% stake (184.8 tenge/$1). The implied cost of BTA Bank’s total equity was estimated at approximately $1 billion or 0.5 of its inventory value as of September 30, 2013. Kazkommertsbank will pay in cash 31 billion tenge at a closing date and 41.075 billion tenge no later than on July 1, 2017.

After closing the deal Samruk-Kazyna will retain a 4.26% stake in BTA Bank but will hand over it to Kazkommertsbank under its management to supervise BTA Bank.

After closing the deal Samruk-Kazyna will retain a 4.26% stake in BTA Bank but will hand over it to Kazkommertsbank under its trust management to supervise BTA Bank, and the two banks are to be merged.

In December 2013, National Welfare Fund Samruk-Kazyna closed a deal to sell a 16% stake in Alliance Bank to Bulat Utemuratov, a Kazakh businessman. After the deal, Samruk-Kazyna will still hold a controlling stake of 51% in Alliance Bank in common and preference shares. The deal is subject to the regulator’s approval, which is expected to be obtained in the first quarter of 2014.