Kazakh banks are attempting to recover after a period in which the economy has been hit by devaluation and low to zero growth, a slump resulting from falling oil prices and stubbornly low commodity prices, on which the Kazakh economy is heavily dependent. Structural failings such as high levels of non-performing loans (NPLs) and an overbanked sector have exacerbated the banks’ problems, but now Michael Eggleton, CEO at Almaty-based Eurasian Bank, says: “We are seeing some light after an exceptionally difficult period.”
Marc Holtzman, CEO of Kazkommertsbank (Kazkom), the country's second largest bank by Tier 1 capital, says a team of bankers and government officials is tackling the bad loans problem, and bankers are in complex discussions with the newly appointed prime minister, Bakhytzhan Sagintayev, and first deputy prime minister Askar Mamin. It is understood a resolution based on the Spanish model of a publicly owned ‘bad bank’ will be implemented in the first half of 2017.
