Nazarbayev Promised To Prevent Qazkom Collapse

Kazakhstan: Banking System Undermined by Expensive Credit

President of Kazakhstan Nursultan Nazarbayev has promised to prevent collapse of Qazkom Bank, formerly known as Kazkommertsbank (KKB). Head of state said about the government’s intention to support the largest bank of Kazakhstan in an interview with Bloomberg.

As the newspaper notes, KKB is experiencing problems due to the high level of arrears and capital deficiency, which were the result of poor management in the past.

According to Nazarbayev, Kazakhstan government sees two ways of the bank supporting: either shareholders will find the funds to increase its assets, or bank to ask for state support.

According to the president, the bank can rely on the state support.

“We have to get it to working condition. We won’t allow a bank collapse. (…) Now we are talking about the bank rehabilitation”, – said the head of state.

Qazkom is one of the largest banks in Kazakhstan and Central Asia. Bank’s shares are listed on Kazakhstan Stock Exchange (KASE). Global depositary receipts, the basic asset of which is the bank’s shares (GDRs) are listed on the London Stock Exchange (LSE).

Financial performance

Indicator As of 04/01/16 As of 01/01/16
Authorized capital 234,560.00 mln. KZT 234,520.00 mln. KZT
Equity capital 397,657.00 mln. KZT 373,268.00 mln. KZT
Total assets 5,157,659.00 mln. KZT 5,094,335.00 mln. KZT
Net income 18,451.00 mln. KZT -18,435.00 mln. KZT
Book value of common share 487.53 KZT 456.92 KZT
Book value of preferred share 180.91 KZT 176.43 KZT
ROA 0.36% -0.36%
ROE

KKB is controlled by local businessman Kenges Rakishev, a son-in-law of Nazarbayev’s long-time confidant, Deputy Prime Minister Imangali Tasmagambetov. Rakishev gained a foothold in Kazkom in 2014 when it bought BTA Bank, a twice-defaulted nationalized lender. Over the past year he built a 71 percent stake as founder Nurzhan Subkhanberdin reduced his position.

Shareholders as of 10/01/16

Shareholder Number of common shares Percentage holding1 Type of securities Additional information
Central Asian Investment Company (CAIC) 70,074,945 8,79% Common shares CAIC controls 113,155,954 common shares of the Bank, including those shares owned by Mr. Subkhanberdin and transferred to CAIC under trust management (43,081,009 common shares) and or 14.19% of the common equity
Mr. Nurzhan Subkhanberdin 47,800,962 5.99% Common shares Mr. Subkhanberdin directly and indirectly via CAIC controls 13.66% of the common equity
Mr. Kenges Rakishev 344,777,652 43.23% Common shares  Mr. Rakishev directly and indirectly via Qazaq Financial Group controls 71.31% of the common equity
JSC Qazaq Financial Group 223,922,790 28.08% GDRs2  and common shares
Samruk-Kazyna National Wealth Fund 85,517,241 10.72% Common shares
Minorities 25,413,637 3.19% GDRs  and common shares
Total: 797 507 2273 100%    

Kazkommertsbank have taken control over BTA Bank (Kazakhstan) in 2015 after banks merger.

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