Big step by National Bank of Kazakhstan to boost EBRD financing in tenge

By Svitlana  Pyrkalo

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The European Bank for Reconstruction and Development (EBRD) and the National Bank of the Republic of Kazakhstan (NBRK) have agreed on the steps that will significantly enhance the EBRD’s local currency financing capability.

The institutions have signed two facilities which will enable the EBRD to source up to US$ 1 billion in tenge from the NBRK for on-lending to Kazakh financial institutions, municipalities and corporates.

The two facilities will be an amended repo agreement for US$ 400 million equivalent and a swap framework agreement for US$ 600 million equivalent, the latter being provided over a three-year period.

The agreements were signed during the Astana Economic Forum by the NBRK Governor Kairat Kelimbetov and EBRD Managing Director Olivier Descamps.

Mr Descamps said: “This step by the National Bank of Kazakhstan is extremely important for the EBRD and for Kazakh businesses which will benefit from our financing in tenge. Our strategic priorities in Kazakhstan focus on diversification, development of the regional infrastructure and strengthening the role of the private sector. These priorities require us to lend more to local businesses in local currency. Today’s agreements open the door for us to significantly increase and improve our lending in tenge.”

NBK Governor, Mr Kelimbetov, said: “Thanks to today’s agreements, the EBRD will be able to increase lending for projects with Kazakh banks, non-banking financial institutions and corporate clients. This will be especially important for micro and SME clients who need protection from foreign exchange risk.”

Since the beginning of its operations in Kazakhstan, the EBRD has invested close to US$ 6.5 billion in the country’s economy, with more than half of the Bank’s projects supporting the private sector.

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