Kazakhstan to offer BTA to Sberbank in Q2 – owner

Jan 23. Reuters. MOSCOW

* BTA owner says debt restructuring talks “going well”
* Fund says “active talks” on BTA sale with Sberbank in Q2
* State welfare fund says BTA final debt deal by April 1

Kazakhstan to offer BTA to Sberbank in Q2 - ownerKazakhstan’s national wealth fund said on Saturday it will hold detailed talks on selling indebted BTA bank to Russia’s Sberbank in the second quarter after final approval of a landmark debt restructuring deal.

The fate of BTA, once Kazakhstan’s largest bank, and its deal to restructure $10 billion in debt are key to investor perceptions of Central Asia’s biggest economy, which has been battered by the global economic crisis.

The bank struck a deal with creditors to restructure the debt in December and hopes to sign legal documents with creditors by the end of January, said the head of Samruk-Kazyna state welfare fund, which controls BTA.

“The restructuring is going well,” the fund’s head, Kairat Kelimbetov, told reporters on the sidelines of an economic conference in Moscow.

“By the end of January we plan to sign the full cycle of legal documents on those agreements with all creditors and by April 1 we hope to have a full creditors’ meeting to define their views on the documents,” he said.

“And, accordingly, after that – so in the second quarter – we will have the active phase of negotiations with Sberbank,” he said, adding that preliminary talks would take place one the sidelines of the World Economic Forum in Davos.

BTA, once the success story of the Caspian nation’s booming economy, has become a symbol of the economic woes of Kazakhstan’s banking sector, which went on a debt-fuelled spending spree before the credit markets dried up in mid-2007.


BTA was taken over the Kazakh state welfare fund in February, but defaulted in May, sending shockwaves through emerging markets and prompting a sell of in Kazakh assets.

Kelimbetov, a former economy minister who is well respected in foreign banking circles, said it was too early to talk about how much state owned Sberbank – Russia’s national savings bank – could pay for a stake in BTA.

“It is too early to talk about this as it depends on how successful and swift the talks will be with creditors,” Kelimbetov said. “Then the full model of the restructuring will be clear.”

Under the agreement reached in December, BTA would issue more than $3 billion in fresh debt and give creditors a 15 percent stake in the bank as part of the deal.

Kelimbetov declined to give reporters exact details of the haircut creditors would accept, but said that after the restructuring Samruk-Kazyna would own 85 percent of BTA.

He said the fund would be ready to talk about selling the entire stake to Sberbank, which holds more than half of Russia’s retail deposits and has an ambitious strategy to generate 5 percent of net income outside Russia by 2014.

“We are ready to listen to any offer from Sberbank – starting from 85 percent and lower,” he said, adding that no other companies had shown a keen interest in buying a stake.

Kazakhstan’s economy, which boomed with annual growth rates of over 10 percent annually from 2000 to 2007, nosedived sharply as the economic crisis cut the inflow of cheap money and slashed prices for oil and metals, two of Kazakhstan’s key exports.

The economy of Kazakhstan, which covers an area more than four times the size of France, is set to grow by about 1.5-2.0 percent in 2010 after growth of 1.1 percent in year-on-year terms in 2009, according to government forecasts.