USD/KZT 453.35  +2.32
EUR/KZT 492.02  +4.55
Fitch assigns Halyk Bank's upcoming eurobond expected 'BB+' rating

ASTANA. April 18. KAZINFORM - Fitch Ratings has today assigned HSBK (Europe) B.V.'s upcoming USD-denominated issue of unsecured senior notes an expected Long-term 'BB+' rating. The final rating is contingent on the receipt of final documents conforming to information already received. Proceeds from the issue of the notes will be deposited with Kazakhstan's JSC Halyk Bank ("Halyk"). Halyk will unconditionally and irrevocably guarantee the timely and full repayment of the notes in the trust deed between Halyk, HSBK (Europe) B.V. and the trustee, Deutsche Trustee Company Limited. HSBK (Europe) B.V. is a Netherlands-domiciled subsidiary of Halyk. Halyk is rated Foreign Currency Issuer Default (IDR) 'BB+', Local Currency Issuer Default 'BBB-' (BBB minus), Short-term Foreign Currency 'B', Short-term Local Currency 'F3', Individual 'C/D', and Support '3'. The Outlook on the Foreign Currency IDR is Positive and Outlook on the Local Currency IDR is Stable, Kazinform refers to Fitch Ratings press service. The obligations of Halyk under the guarantee will rank at least equally with claims of other unsecured and unsubordinated creditors of Halyk, save those preferred by relevant (bankruptcy, liquidation etc.) laws. Under Kazakh law, the claims of retail depositors rank above those of other senior unsecured creditors. At end-December 2006, retail deposits accounted for around 24% of Halyk's total liabilities, according to the bank's audited IFRS financial statements. Covenants limit Halyk's common stock dividend payments to 50% of net income in any particular year and also specify that the terms of all transactions of more than USD5m must be concluded on a market basis. The issue is subject to a cross default clause, which becomes applicable should an aggregate principal amount of overdue financial debt or guarantee exceed USD10m. Halyk shall not permit its total capital adequacy ratio calculated in accordance with applicable local regulations to fall below the minimum ratio of 10% pursuant to such regulations. Halyk retains a leading position in terms of its retail customer base and branch network. At end-January 2007, the bank ranked fifth with a 10% share of the system assets, although the latter has been declining gradually due to the more aggressive growth of medium-sized players. Following the December 2006 IPO, institutional and individual investors now hold a 29% stake in the bank. Almex Group, beneficially owned by the daughter and son-in-law of President Nazarbayev, retains a 64% stake.


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