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Banking

Kazakh banks still queasy after a borrowing binge

Kazakhstan’s banks have built up onerous debt repayments after a splurge of Eurobond issuance. Are they facing a liquidity crunch?

The biggest face onerous debt repayments in unpropitious domestic circumstances after a splurge of Eurobond issuance. With little activity about, only Halyk seems to be flourishing. Elliot Wilson reports from Almaty.

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ON THE SURFACE at least, rumours about the demise of Kazakhstan’s debt capital markets appear to have been greatly exaggerated. In early April, Halyk Bank, the country’s third-largest lender by market capitalization, surprised many by launching the first Eurobond issuance by a Kazakh lender since July 10 2007.

The $500 million five-and-a-half-year bond, underwritten by JPMorgan and UBS, came at a hefty premium, with a 9.5% yield. It attracted strong ratings – a BB+ by Standard & Poor’s and a Baa3 investment grade by Moody’s – and showed that Halyk Bank at least has access to global debt markets.

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