BTA suspends lending operations in the wake of 20% currency devaluation

BTA has suspended its lending operations in the wake of the 20% currency devaluation, Tengrinews.kz reports, citing the Bank’s Press Service. According to the Bank, suspension of consumer lending and mortgage program is a temporary measure. The Bank elaborated they need to reconsider lending conditions following the currency devaluation. “After respective decision are taken, which is by February 28, the Bank will resume its lending operations to solvable borrowers”, the Press Service said. Starting from February 11, 2014 Kazakhstan’s Central Bank decided to stop supporting the tenge exchange rate, decrease currency interventions and stop interference with shaping the tenge exchange rate. BTA is a Kazahstan-based bank, 3rd in terms of assets as of August 1, 2013. Established in 1991, the bank was bailed out by the Government back in 2009: Samruk –Kazyna Sovereign Wealth Fund purchased 75.1% in the Bank. Following the Government’s bail out, BTA defaulted on $12bn of debt and agreed a restructuring that saw foreign creditors take a $7bn haircut. A second restructuring for another $11bn was concluded late 2012. KazKommertsBank and BTA are to merge before the end of the year, Tengrinews.kz reported February 6. That day KazKommertsBank said that the lender and entrepreneur Kenes Rakishev would buy 46.5% in BTA each from Samruk-Kazyna Sovereign Wealth Fund. KazKommertsBank would pay about $465 million for its share. The two banks are to merge following the deal.