Grigory Marchenko: the main thing is to tell the truth and always keep promise

Mar 21. Kazpravda. Almaty

By Dinara Yusupova

Grigory Marchenko: the main thing is to tell the truth and always keep promiseAll investors’ contributors will remain in their property in full and will be kept on individual accounts, as before, said during the online press conference Chairman of the National Bank Grigory Marchenko to the apprehensions about the merge of the SPFs in a single pension fund.

Responding to the questions, the head of the National Bank of Kazakhstan also explained that “the procedure to transfer private pension assets to the single pension saving fund is already regulated by the law, and will be implemented in a short time. It does not require the elimination of private pension funds, because, under the law, pension funds are recorded separately from own assets of the SPF. The existing pension funds will keep their own assets and will have a further opportunity to continue their activities as investment portfolio managers or voluntary pension fund”.

He also explained that the system of state guarantees for the safety of pension savings extends to the pension savings in private pension funds and will also extend to the accumulations in the SSPF.

– As for the return to the solidarity pension system, in the past, we saw its insolvency in 1998 when the pension system of Kazakhstan was in crisis: chronic, multiple non-payment of pensions, reaching $ 500 million, and 5-6 months lags in time – he recalled. – The purpose of the pension reform in 1998 was to protect the incomes of pensioners and also to promote private sector’s growth and development of capital markets in the country. Also the funded pension system of the country was designed to solve a number of problems: to ease social tensions, to gradually release the budget from the burden of pension payments, to encourage citizens’ interest to earn more legally. The SSPF will save the system of individual retirement accounts of depositors. Therefore, it is not a solidarity system, where the load of the retirement benefit falls on the working population.

The participants of the conference were also interested in: monetary policy of the NBK, control inflation, the stability of the currency market, the issuance of commemorative coins and even the budget of the National Bank. Responding to the question about the NB budget its chairman said that the NB does not use money of taxpayers.

– Revenues of the central bank are formed mainly at the account of investment income from the management of gold and foreign assets and service of the Government – said the banker. – In this case the National Bank is not engaged in commercial activities. In general, the financial independence is an important factor in the independence of central banks from government and other public bodies. Due to the fact that central banks are not funded from the budget, they can independently develop and implement the monetary policy of the state. Only such status allows central banks to effectively achieve their goals by providing low inflation, thereby protecting the impairment income and savings, return on investments in production.

Speaking about the position of the national currency, Grigory Marchenko said that the confidence of Kazakhstani citizens in tenge is growing, and cited the following figures: in the last three years the population’s share in the deposits in foreign currency decreased from 56.6% (December 2009) to 39.1% in January 2013. The growth of deposit base testifies the stable growth of trust from the public and business in the banking system.

He also said that now the main indicators show the stability of the banking sector in Kazakhstan. He characterized the appetite of Kazakh banks for risk as moderate; the banks continue to lend to the corporate sector, as well as the population. At the same time the banker agreed, that the echoes of the financial crisis, in particular high level of problem assets, still prevent banks to proceed to their sustainable growth. G. Marchenko also noted the trend of changes in the structure of banks’ funding, especially the banks which have reoriented to the domestic sources. And the results of stress tests showed that the adequacy of banks’ capital is at an acceptable level. The situation in the banking sector is stable, again stressed the head of NBK.

He also answered the personal questions. In particular, to the question about his primary habit he said: it is to “tell the truth and always keep promises.”

The full text of the conference is placed on the site of the forum –