Baku, Azerbaijan, Dec. 23
By Ali Mustafayev – Trend:
S&P Global Ratings has affirmed its 'BB/B' long- and short-term issuer credit ratings on Halyk Savings Bank of Kazakhstan (Halyk Bank). The outlook remains negative.
S&P has also affirmed 'kzA' Kazakhstan national scale rating on Halyk Bank.
“At the same time, we placed our 'B+' long-term issuer credit rating and 'kzBBB-' Kazakhstan national scale rating on Kazkommertsbank JSC (KKB) on CreditWatch with positive implications. We affirmed the 'B' short-term issuer credit rating on KKB," S&P said in a message Dec. 23.
The rating actions follow Halyk Bank's announcement on December 15 that its board of directors has approved the merger of KKB into Halyk Bank. The merger is expected to be finalized in the second half of 2018, subject to regulatory approvals and finalization of a number of corporate governance procedures.
“We believe that Halyk Bank’s financial profile will remain largely stable after possible capital outflows from minority shareholders during the upcoming group reorganization. Minority owners now hold 19.95 percent of Halyk Bank’s overall share capital. Under Kazakhstan's regulation, Halyk Bank has an obligation to buy out the stakes of minority shareholders that vote against the merger."
The rating organization sees Halyk Bank's business position as strong. This assessment balances the bank's leading share of Kazakhstan's banking market, sound business diversification, and experienced management team with a proven track record of stable performance through the economic cycle, against risks related to the integration of KKB, which is still burdened by legacy problem assets.