Kazakhstan Bank Merger Makes Progress As More Terms Agreed
The planned takeover of Kazakhstan’s Kazkommertsbank by rival Halyk Bank moved a step closer on Friday as the two lenders agreed some key terms.
They included an agreement for Halyk to buy the stakes of Kazkommertsbank’s two biggest shareholders for a notional amount of 1 tenge ($0.0032) each, the central bank said in a statement.
The banks signed a provisional agreement to merge in March, a deal supported by the government and central bank to strengthen the country’s ailing banking sector.
Halyk is also due to inject capital into Kazkommertsbank after the latter sells 2.4 trillion tenge ($7.5 billion) of bad loans to Kazakhstan’s state-run “bad bank”.
However, the two sides have yet to decide on the size of the capital injection, despite months of talks, and the central bank said on Friday that the amount had still to be determined.
The former Soviet republic has struggled to recover from the 2008/09 global financial crisis and its banking sector has been beset more recently by bad loans since the sharp slide in the oil price, Kazakhstan’s main export.
Kazkommertsbank’s two biggest shareholders are businessman Kenges Rakishev and sovereign wealth fund Samruk-Kazyna, with a combined 54 percent stake. (Reporting by Olzhas Auyezov; Editing by Jack Stubbs and Susan Fenton)