Ex-finance Minister Shares Forecast On Possible Tenge Devaluation

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Bolat Zhamishev, Chairman of the Board of the Development Bank of Kazakhstan (DBK) has given his outlook on possible devaluation of the Kazakh national currency, Kazinform correspondent reports.

“Generally speaking, we do not see any expectations or drastic changes of exchange rate dynamics. The national currency is now strengthening. It is not improbable it will stream back and lead to a certain period of devaluation, but altogether we do not think there is any train wreck waiting to destroy this dynamics”, Zhamishev told a briefing in Central Communications Service.

He explained that the DBK does not forecast rate movement of the national and other currencies but monitors the dynamics and factors that can make a big difference. The bank take actions to exclude any complications in the activity of the financial institution and its loaners in case of possible drastic change of exchange rates.

“At the present time, we do not finance the projects, as we did before (they were included in the portfolio), which cannot confront currency risks. Nevertheless, they were financed in foreign currency. In 2015 and 2016 we had to restructure a part of the loans and turn the bank requirements from the foreign currency to KZT. That is to say we are now geared to our capability of providing a relatively cheap loan in foreign currency but we do it only for those enterprises which are export-oriented or able to confront currency risks. This is how we meet the challenges devaluation can cause.”, the chairman explained.