Kyrgyzstan buffs up its appeal
Local regulators keen to attract new entrants; Aversion to banks exacerbated by AUB affair
Kyrgyzstan’s banks are small, almost exclusively foreign-owned and invariably cautious to the point of paranoia. The local authorities are eager for newcomers to dip their toes into this pond, arguing that the post-Soviet economy will boom. But most newcomers that take up the invitation find a market that is deeply hostile to financial institutions, with potential clients much more inclined to invest in gold or put their money under the bed rather than use a bank deposit.
"The country is under-banked. There are financial assets worth some $5 billion waiting to be absorbed by banks that decide that they can take the political risk"
Almas Chukin, Kazyna Capital Management
The latest foreign bank looking to set up a branch in Kyrgyzstan is China’s State Bank, says deputy chairman of the National Bank of Kyrgyzstan Zayir Chokoev. Banks should not be deterred by perceived hostility, says Almas Chukin, the Kyrgyz-born chairman of Kazyna Capital Management, a Kazakh investment company. He believes there are opportunities for financial institutions. "The country is under-banked," he says. "There are financial assets worth some $5 billion waiting to be absorbed by banks that decide that they can take the political risk."