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Kazakhstan's BTA bank has been granted a permanent injunction against legal actions or proceedings in the U.S. that violate the terms of its restructuring plan agreed last month, Tengrinews.kz reports citing the bank's press-service. The injunction issued by the United States Bankruptcy Court for the Southern District of New York on January 3 blocks any enforcement of debts against the bank or its property in the United States. But at the same time it does not prevent enforcement of any rights granted in relation to the restructuring plan. Earlier the plan received a similar protection in the United Kingdom - High Court of England and Wales issued the permanent injunction on 19 December 2012. Thanks to these two rulings the restructuring plan has obtained permanent protection of the courts in both the United Kingdom and the United States and the actions inconsistent with the restructuring plan are now prohibited in both countries. BTA drew a line in its second restructuring late last month, on December 28. The move involved restructuring of $11.1 billion of debts resulting in recapitalization of $10 billion. Holders of 2018 Notes and Recovery Units were given an option to exchange all or a part of their entitlements for new 10-year notes of the bank. As a result the creditors received cash in the amount of USD 1,618 million and new notes in the amount of USD 750 million. Besides, BTA issued 597,286,607,949 common shares distributed in the form of Shares or GDRs, pursuant to the conversion of USD 1,189 million of deposits from Samruk-Kazyna and USD 19 million of the Bank’s subordinated debt into equity. Further, the bank has received a USD 1,592 mln. subordinated loan from Samruk-Kazyna (denominated in tenge) relating to the new notes and RCTFF. In the other words, as part of the deal, $1.21 billion of debt was converted into common stock and $9.04 billion of debt was exchanged for $1.62 million in cash and $750 million in new bonds. Subsequent to the restructuring, the bank's Tier 1 capital climbs to 21.8% and the bank plans to the above 10% regulatory minimum in line with Basel 2 requirements. “It will make 212.2 billion tenge, which is equivalent to $1,456 million and, as promised, the capital adequacy will be fully restored, in particular, the level of the first-tier capital by basic standards has been stacked at over 10 percent. It turns out in the reports that the first-tier capital will comply with the adequacy by climbing to over 21.6 percent. Considering the achieved restructuring, in the nearest 4 years BTA Bank’s capital adequacy will be at a reasonable level, considering the regulator’s requirements planned to be introduce in 2013 under Basel-3 requirements,” deputy chairman of Samruk-Kazyna Yelena Bakhmutova said in December before approval of the restructuring by Almaty Financial Court on February 28. Kazakhstan's Samruk-Kazyna, BTA bank's controlling shareholder, supported the restructuring by converting deposits into equity, increasing its shareholding in the bank from 81.3% to 97.3%, accepting an increase in the coupon on its bonds held as an asset by the bank, and through a $1.592 billion interest-bearing loan subordinated to the new notes. BTA is now Kazakhstan's third-largest bank by assets. Kazakhstan government took over BTA three years ago as part of Kazakhstan's anti-crisis program because the bank was encountering financial difficulties and failing to meet capital adequacy level requirements. The first restructuring of the bank’s debt followed shortly after. It was completed in September 2010. As a result, the bank’s debt was cut down from $12 to $3.7 billion. The payment periods were changed from 1-5 years to 8-20 years. However the bank's financial situation continued deteriorating, and its estimated capital shortfall made $3.9 billion at the end of 2011. The second restructuring was triggered by BTA's default on its $166 million bond coupon in January 2012. The steering committee was formed in February to represent stakeholders in the bank's second restructuring.
Kazakhstan's BTA bank has been granted a permanent injunction against legal actions or proceedings in the U.S. that violate the terms of its restructuring plan agreed last month, Tengrinews.kz reports citing the bank's press-service.
The injunction issued by the United States Bankruptcy Court for the Southern District of New York on January 3 blocks any enforcement of debts against the bank or its property in the United States. But at the same time it does not prevent enforcement of any rights granted in relation to the restructuring plan. Earlier the plan received a similar protection in the United Kingdom - High Court of England and Wales issued the permanent injunction on 19 December 2012.
Thanks to these two rulings the restructuring plan has obtained permanent protection of the courts in both the United Kingdom and the United States and the actions inconsistent with the restructuring plan are now prohibited in both countries.
BTA drew a line in its second restructuring late last month, on December 28.
The move involved restructuring of $11.1 billion of debts resulting in recapitalization of $10 billion.
Holders of 2018 Notes and Recovery Units were given an option to exchange all or a part of their entitlements for new 10-year notes of the bank. As a result the creditors received cash in the amount of USD 1,618 million and new notes in the amount of USD 750 million. Besides, BTA issued 597,286,607,949 common shares distributed in the form of Shares or GDRs, pursuant to the conversion of USD 1,189 million of deposits from Samruk-Kazyna and USD 19 million of the Bank’s subordinated debt into equity. Further, the bank has received a USD 1,592 mln. subordinated loan from Samruk-Kazyna (denominated in tenge) relating to the new notes and RCTFF.
In the other words, as part of the deal, $1.21 billion of debt was converted into common stock and $9.04 billion of debt was exchanged for $1.62 million in cash and $750 million in new bonds.
Subsequent to the restructuring, the bank's Tier 1 capital climbs to 21.8% and the bank plans to the above 10% regulatory minimum in line with Basel 2 requirements.
“It will make 212.2 billion tenge, which is equivalent to $1,456 million and, as promised, the capital adequacy will be fully restored, in particular, the level of the first-tier capital by basic standards has been stacked at over 10 percent. It turns out in the reports that the first-tier capital will comply with the adequacy by climbing to over 21.6 percent. Considering the achieved restructuring, in the nearest 4 years BTA Bank’s capital adequacy will be at a reasonable level, considering the regulator’s requirements planned to be introduce in 2013 under Basel-3 requirements,” deputy chairman of Samruk-Kazyna Yelena Bakhmutova said in December before approval of the restructuring by Almaty Financial Court on February 28.
Kazakhstan's Samruk-Kazyna, BTA bank's controlling shareholder, supported the restructuring by converting deposits into equity, increasing its shareholding in the bank from 81.3% to 97.3%, accepting an increase in the coupon on its bonds held as an asset by the bank, and through a $1.592 billion interest-bearing loan subordinated to the new notes.
BTA is now Kazakhstan's third-largest bank by assets. Kazakhstan government took over BTA three years ago as part of Kazakhstan's anti-crisis program because the bank was encountering financial difficulties and failing to meet capital adequacy level requirements.
The first restructuring of the bank’s debt followed shortly after. It was completed in September 2010. As a result, the bank’s debt was cut down from $12 to $3.7 billion. The payment periods were changed from 1-5 years to 8-20 years.
However the bank's financial situation continued deteriorating, and its estimated capital shortfall made $3.9 billion at the end of 2011.
The second restructuring was triggered by BTA's default on its $166 million bond coupon in January 2012. The steering committee was formed in February to represent stakeholders in the bank's second restructuring.
