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Syndicated loan to boost Kazkommertsbank
EBRD and commercial banks provide $300 million term loan facilityboost Kazkommertsbank
In one of the biggest syndicated loans to a Kazakh bank to-date, the EBRD and
a syndicate of commercial banks are providing Kazkommertsbank (KKB) with a
$300 million EBRD A/B loan facility. The term of the loan is 7 years for the A
loan and 5 years for the B loan which is the longest tenor ever achieved for a
Kazakh bank.
The A loan of $100 million will be for the EBRD’s own account, while the B
loan of $200 million has been fully underwritten and syndicated by Calyon and
Sumitomo Mitsui Banking Corporation Europe Limited.
The loan will be used for on-lending to retail customers for residential
mortgages and privately-owned mid-sized corporate customers outside the
construction, oil and gas sectors. Being the longest term for a syndicated
loan provided to a Kazakh bank, the transaction will set a new maturity
benchmark in the market and allow Kazkommertsbank to further diversify and
secure its funding sources.
The strong growth of the Kazakh economy (10.6 per cent in 2006) is also
reflected in a rapid development of the country’s financial institutions.
Kazkommertsbank is Kazakhstan’s biggest bank and has been working with the
EBRD since 1996. The bank is now increasingly focusing on smaller corporate
clients where considerable growth can be expected over the next years.
Kurt Geiger, EBRD Business Group Director Financial Institutions, said the
loan will facilitate KKB’s efforts to finance a wide range of customers. It
will also contribute to the diversification of the country’s economy by
specifically targeting the funds for on-lending to privately owned mid-sized
companies.
Andrey Timchenko, Managing Director of Kazkommerstbank, said the transaction
is a significant breakthrough in the Kazakh market considering the terms and
maturity of the financing. The loan demonstrates the strong interest of
international commercial banks in the Kazakh market and their readiness to
take longer exposure to KKB. This will support Kazkommertsbank’s long term
business strategy to strengthen its position in the SME and retail segments.
To-date, the EBRD has invested more than €1.5 billion in Kazakhstan. In the
financial sector alone, the EBRD currently has investments with 10 banks in
Kazakhstan and 4 non-banking institutions.
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