S&P affirms and withdraws Kazakh Zaman-Bank JSC ratings

S&P affirms and withdraws Kazakh Zaman-Bank JSC ratings

Baku, Azerbaijan, Nov.28

By Elena Kosolapova - Trend:

Standard & Poor's Ratings Services affirmed its CCC+/C long- and short-term counterparty credit ratings and kzB- Kazakhstan national scale rating on Joint Stock Company Zaman-Bank, the rating agency said Nov.28.

Then the rating agency subsequently withdrew the ratings at the bank's request, the message said.

At the time of the withdrawal, the outlook was stable, S&P said.

"The ratings on Zaman-Bank reflected the bb- anchor that starts our rating analysis on financial institutions operating in Kazakhstan," the message said. "The ratings also reflected the bank's "weak" business position, "very strong" capital and earnings, "weak" risk position, "below average" funding and "adequate" liquidity, as our criteria define these terms."

S&P said that their assessment of Zaman-Bank's business position as "weak" reflected the bank's narrow regional franchise, very small market share, limited customer base, and only basic management and risk-control functions that would make it very vulnerable in the event of business expansion. With total assets of Kazakhstani tenge (KZT) 14.9 billion (about $82 million) as of Sept. 1, 2014, Zaman-Bank ranks No. 36 among Kazakhstan's 38 banks, with a market share of 0.1 percent by assets, said the message.

"Our assessment of Zaman-Bank's capital and earnings as "very strong" reflects the bank's low asset growth and conservative capitalization policy compared with that of other small rated Kazakh banks, and our belief that the bank would maintain very high capital ratios in the next two years," the rating agency said. "We forecast that our risk-adjusted capital (RAC) ratio for Zaman-Bank would weaken from 42 percent at year-end 2013, but stay above 30 percent in 2014-2015. The bank's profitability is modest and volatile, in our view. The financial results for the first nine months of 2014 were boosted by the reversal of provisions."

The assessment of Zaman-Bank's risk position as "weak" reflected very high individual, regional, and industry concentration risk in the lending book, the message said. According to the estimates of S&P, the 20 largest loans accounted for about three-quarters of the loan book as of Sept. 30, 2014. About two-thirds of total loans were to small companies operating in the trade, agriculture, and food industries in the Ekibastuz and Pavlodar regions, S&P said.

Nonperforming loans (NPLs; more than 90 days overdue) accounted for 4.5 percent of Zaman-Bank's total loans, as reported by the regulator, as of Sept. 30, 2014, and are in line with those of other small Kazakh banks, the message said. Loan loss reserves to customer loans were adequate, in our view, at 7 percent of total loans, and fully covered NPLs as of Sept. 30, 2014, the agency said.

"We assessed Zaman-Bank's funding as "below average," reflecting the very high reliance on shareholder deposits and equity as the main funding sources," the message said.

External deposit funding is low, given the bank's limited franchise, said the agency.

The agency assesses Zaman-Bank's liquidity is "adequate," with liquid assets accounting for 23 percent of total assets as of Sept. 30, 2014.

"At the time of the withdrawal, the outlook was stable, reflecting the balance between our expectation that the bank will maintain very strong capitalization and the bank's persistently vulnerable risk profile, marginal competitive position, and concentrated funding over the next 12 months," the rating agency said.

For any questions or feedback, follow the author on Twitter: @E_Kosolapova

Subscribe to Trend in Google News! Subscribe
Tariffs for renewable energy drop in Kazakhstan
Tariffs for renewable energy drop in Kazakhstan
Japanese Noritsuisu Co. Ltd preparing to launch new project in Uzbekistan
Japanese Noritsuisu Co. Ltd preparing to launch new project in Uzbekistan
Kazakhstan’s mining company opens tender on spare parts for truck
Kazakhstan’s mining company opens tender on spare parts for truck
Loading Bars
Latest
14th batch of Sputnik V vaccines delivered to Iran Embassy in Moscow
Tariffs for renewable energy drop in Kazakhstan
GD leaders address supporters, promise Georgia's development
Opening of Fuzuli Int'l Airport landmark event for Azerbaijan and dev't of region- Russian expert
Japanese Noritsuisu Co. Ltd preparing to launch new project in Uzbekistan
Kazakhstan’s mining company opens tender on spare parts for truck
Uzbekistan to build its first digital control system substation
Turkey unveils its economy sectors attracting foreign investors
Azerbaijan reveals TOP-10 banks in terms of income for 3Q2021
Azerbaijan’s TOP-10 banks in expenditures terms for 3Q2021 revealed
TBC Bank to financially support Georgian farmers
Kazakhstan draws up national project for energy complex dev’t by 2025
Kazakhstan discloses deterioration degree of local power grids
Cairo-Moscow flight returns to airport due to suspicious message in cabin
Norwegian Air to lease 13 Boeing planes
McDonald's sales soar on higher prices, newer menu items
Iran supports development of constructive relations with Azerbaijan - FM
Iran’s PMO declares volume of essential products available in ports
TOP-10 Azerbaijani banks in terms of net profit for 3Q2021
Azerbaijan inks new deals with several states on investment in its Alat FEZ - ministry
Kazakhstan increases mobile internet speed in September
IMIDRO reveals data on iron ore concentrate production in Iran
Renaissance Capital forecasts inflation in Georgia to slow down
Azerbaijan talks possible vaccination of adolescents prone to catching COVID-19
Kazakhstan considering introducing carbon tax
India, Kyrgyzstan hold first strategic dialogue, discuss Afghanistan
Uzbekistan Railways modernizing railway carriages to increase passenger traffic
Japanese TEPCO plans to continue investment in Georgia's energy sector
Iran’s Bahar Azadi gold coin price rebounds
Iran`s TEDPIX on the rise after week of decline
Teva Pharm Q3 profit misses estimates, to sell $4 bln in bonds
OPEC ready to strengthen co-op with Turkmenistan
Kazakh Energy Ministry working on building nuclear power plant
Uzbek Ministry of Finance to cancel fees for purchase of used cars in 2022
Indian Railways changes policy, PSUs to now compete in open market for tenders
Turkey's leather exports to Iran up in value for 9M2021
Azerbaijan confirms 2,300 more COVID-19 cases, 1,248 recoveries
Azerbaijan shares data on number of vaccinated citizens
Georgia and Spain eye to launch direct flights between capitals
Azerbaijan, WB ink new loan agreement
Iron ore concentrate production by giant Iranian companies up
Turkmenistan starts experimental growth of papaya in Mary region
IMF revising India's growth forecast is 'gross under estimation': N K Singh
Turkish KOSGEB talks interest in implementing projects in Azerbaijan's Karabakh
Decarbonization of economy to transform Kazakhstan’s fuel and energy complex – minister
Kazakhstan's trade indicators with EAEU member states for 8M2021 unveiled
Kazakhstan records decrease in renewable energy tariffs
Bank Keshavarzi Iran provides loans for construction of greenhouses
State Grain Fund of Azerbaijan transferred to jurisdiction of State Reserves Agency
Azerbaijani President Ilham Aliyev congratulates President of Czech Republic
Iran resumes rice imports
Israel government foreign currency bonds to trade on Tel Aviv bourse
Putin, Finnish president to discuss bilateral cooperation, global issues — Kremlin
Uber partners with Hertz to offer 50,000 Tesla rentals to U.S. ride-hail drivers
Turkmenistan and Iran to expand trade ties
Equinor slightly reduces equity production of liquids and gas
Nar upgrades another sale and service center (PHOTO)
Achieving carbon neutrality in Kazakhstan requires big investments - minister
Amount of loans issued by Bank Keshavarzi Iran increasing
Azerbaijan’s liberated lands to soon become example of modern production for entire region – Erdogan
Iran reveals COVID-19 data for October 27
Equinor expects 2% increase in 2021 liquids and gas production
Iran, Uzbekistan seek to boost ties both regionally and internationally
Iran`s Raisi reaffirms will to boost ties with Turkmenistan
AIIB helps strengthen healthcare infrastructure in India
Turkmenistan, Iran discuss issues on boosting transport communication
Turkmenistan, Iran interested in intensifying contacts in regional, int’l structures
Kazakhstan, Kyrgyzstan consider resumption of passenger rail transport
Amount of addressed state social benefits proposed to raise in Azerbaijan
Iran determined to pay off gas debt to Turkmenistan – Iranian minister
2nd ICD – CIBAFI Webinar Discussed the Emergence of Cryptocurrencies and its Potential for the Growth of Islamic Finance Industry
Georgia, Poland to co-op in railway sector under EU-funded project
Kazakh gold extracting venture opens tender to buy spares
Equinor’s non-current assets drop in Azerbaijan
Saudi Arabia licenses 44 companies to open regional headquarters in Riyadh
Central Bank of Iran unveils details of oil exports
Reps of Turkish National Defense University visit Azerbaijani military educational institutions (PHOTO)
Azerbaijan may increase need criterion next year
India among top 10 in the world for cliate technology investments: report
Turkmenistan launches production of filament lamps
Azerbaijan to increase budget financing of healthсare sector in 2022
Turkmenbashi complex of oil refineries open tender for construction of hydrogen production unit
Equinor reduces liquids output from Azeri-Chirag-Gunashli
Activity of most filling stations in Iran resumed
Turkmenistan increases imports of Turkish leather goods
Turkey discloses cargo traffic via local ports from US in 9M2021
Iran shares data on electricity generation of Manjil Wind Power Plant
Turkey-Azerbaijan trade turnover for 9M2021 revealed
SOCAR announces planned works at Baku Oil Refinery
Kazakhstan slightly increases raw sulfur production volumes
BSTDB reveals portfolio of signed operations in Azerbaijan (Exclusive)
Turkey announces growth in foreign trade turnover
Georgian bureaucratic expenditures need to be cut - IDFI
Saudi Energy Minister says carbon offsets can help with emissions goal
Azerbaijan plans to increase living wage
Businessmen in Karabakh to be exempt from certain taxes, fees - ministry (PHOTO)
TAP deploying new solutions to ensure efficient and secure operations
Azerbaijan's state budget spending on science to grow in 2022
TAP consortium to open tenders in digitalization area
Iran’s NIDC discloses number of oil-gas wells drilled in country
All news