Halyk Bank Says Has Considered Merger With Kazkommertsbank

Kazakhstan's State-Run 'Bad Bank' To Buy Assets From KKB - Cenbank

(Reuters) – Nov 18 Halyk Bank, Kazakhstan’s No.2 lender by assets, said on Friday a merger with top-ranked Kazkommertsbank (KKB) had been considered but said “there can be no certainty that this will lead to commencement of negotiations”.

Commenting on a Reuters report of talks, the bank said in a statement: “Indeed, during 2016 within the framework of general discussions a number of scenarios of banking sector developments were considered, which in our view cannot be treated as conducting negotiations.”

Two sources told Reuters this week that the two banks, which have combined assets of $27 billion, were in talks about a potential merger. Halyk declined to comment at the time.

If a merger takes place, the combined bank would be four times the size of the No. 3 lender by current assets but the merger could involve the write-down of bad assets belonging to Kazkommertsbank, one source who is close to Halyk Bank has said.

Halyk, listed in London and Almaty, has a market capitalisation of $1.7 billion, while domestically listed KKB’s market capitalisation is about $540 million.

Halyk said on Friday that it “would only contemplate undertaking such transactions if they were to be entered into on a commercial basis on arm’s length terms in accordance with international standards and if transactions take into account interests of shareholders and other stakeholders of Halyk Bank”. (Reporting by Olzhas Auyezov; editing by Christian Lowe and Jason Neely)

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