Fitch revises outlook on Kazakhstans ratings to stable from negative.

By bne IntelliNews December 18, 2009
Fitch affirmed Kazakhstan s long-term foreign currency issue rating at BBB- and long term local currency IDR at BBB and revised outlooks on both ratings to stable from negative. At the same time, Fitch affirmed short-term foreign currency IDR at F3 and the country ceiling at BBB. Fitch considers that Kazakhstans crisis-hit banking system remains a source of risk however, Fitchs base assume is that further cost for the sovereign of clearing up the risk will be containable at the current rating level. Moreover, higher oil prices, and capital inflows are boosting official reserves, strengthening Kazakhstan s balance sheet and further supporting the stable outlook. Fitch noted that Kazakh banking system has still to exit a crisis that broke with the dislocation of global capital markets in summer 2007. The ratio of non-performing loans (more than 90 days overdue) to total loans hit 19.7% in October 2009, up from 5.2% at end-2008. The system's aggregate capitalisation became negative in May 2009 on official figures, as problems at two large failed banks (BTA and Alliance ) were recognised. An improvement in the balance of payments is supporting the national currency KZT at its re-pegged level of about KZT 150 for USD 1, after devaluation in February, which reduces risks facing the banking sector, where some 51% of loans are FX-denominated. Kazakhstan 's official reserves rose to a record USD 23.3bn by end-November, up 17% ytd. Fitch forecasts general government debt at 13% of GDP at end-2009 and the general government is projected to remain a net creditor to end-2011. Continued evidence of stabilisation in the banking system and recovery in the broader economy, combined with consolidation of the external finances, would support the ratings.

Read in IntelliNews Pro
Get IntelliNews Pro

Related Articles

Kazakhstan in talks with McDonald's.

Kazakhstan is in talks over McDonald's enter to the Kazakh market, President of the Eurasian Franchising Association, Beknur Kissikov has said. He added that the main reasons that McDonald's is ... more

Kazakhstan to establish institute for energy and energy effectiveness.

Kazakhstan will establish institute for energy and energy effectiveness, deputy PM and Minister of Industry and New technologies Aset Isekeshev has informed. The new entity should start operating ... more

Kazakhstan to diminish oil products imports from Russia.

Kazakhstan plans to diminish oil products imports from Russia, according to Kuandyk Kulmurzin Director of oil industry development department in Oil and Gas Ministry. He explained that the reason ... more

Follow Us On

Most Read

  1. Ukraine's birth rate plummets to 300-year low as country’s population collapses
    8 days ago
  2. EU finally boosts defence investment into arms production as Ukraine runs out of ammo
    1 month ago
  3. Don't mention the "D" word - Ukraine
    6 days ago
  4. The 'wet-bulb' set to kill hundreds of thousands of people if temperatures and humidity levels continue to rise
    3 days ago
  5. Europe unlikely to tackle Russian LNG imports anytime soon
    3 days ago
  1. Russia could pay off its entire external debt tomorrow, in cash
    26 days ago
  2. Speculation swirls of “Men in Blue” in Crocus City Hall terrorist attack linked to FSB
    1 month ago
  3. Albanians campaign on social media to keep bus bridge created in freak accident
    1 year ago
  4. BRICS announce a blockchain-based payment system to create a common currency
    29 days ago
  5. Saudi Arabia to scale back plans for Neom city
    16 days ago

Reports

Dismiss