External debt of the Kazakhstan’s banking sector shrank by $30 billion

External debt of the Kazakhstan’s banking sector for the last three years has been reduced by almost $30 billion, PM Karim Massimov said when speaking at a sitting of the Nur Otan fraction September 20. “External debt of the banking sector reduced from $46 billion in December 2007 to $16.6 billion in March 2011. The debt figure shrank by $29.4 billion”, the PM informed. The PM reminded that back in 2008 three major banks – Kazkommerts, Halyk and Alliance – faced a tough period, with BTA “involved in fraudulent operations nearing default”. “Bankruptcy of these banks would have meant paralysis of the entire financial system and of the real sector of the economy (…) In the wake of the global financial crisis second-tier banks were provided with additional sources of liquidity, which allowed to inject $3.35 billion into the economy (…) the government purchased stakes in the major banks in exchange for financial support. To secure greater stability of the financial system, some banks underwent debt restructuring”. The PM reminded that over $10 billion had been allocated from the National Oil Fund in 2007 and 2008 to finance a wide range of anti-crisis measures.