FITCH ASSIGNS ALLIANCE BANK'S EUROBOND EXPECTED "B+" RATING

/REUTERS, London, June 8, 05/ - Fitch Ratings, the international rating agency, has today assigned the upcoming issue of notes of Alliance Bank of Kazakhstan ("Alliance") an expected Long-term "B+" rating. The assignment of the final rating is contingent on receipt of final documentation conforming materially to information already received. Alliance is rated Long-term "B+" with a Stable Outlook, Short-term "B", Individual "D" and Support "4". The terms and conditions of the notes specify that they will rank at least pari passu with the claims of other unsecured creditors, save those preferred by relevant (bankruptcy, liquidation etc.) laws. Under Kazakh law, the claims of retail depositors rank above those of other senior unsecured creditors. At end-2004, retail deposits accounted for 21% of Alliance's total liabilities, according to the bank's International Financial Reporting Standards accounts. Covenants limit dividend payments to 50% of net income in any particular year, and also specify that the terms of all transactions of more then USD 2 million must be concluded on a market basis. Alliance also commits to maintaining a total BIS capital adequacy ratio of 10%, and a cross default clause becomes applicable in case of overdue indebtedness in excess of USD 10 million. The terms and conditions of the notes contain a negative pledge clause, which allows for a degree of securitisation by Alliance. In the event of such a securitisation, Fitch notes that the nature and extent of any over- collateralisation would be assessed by the agency for any potential impact on unsecured creditors. Noteholders will benefit from a put option should one of the bank's credit ratings be downgraded as a result of an asset sale by, or a merger of, Alliance. At end-2004, Alliance was the sixth largest bank in Kazakhstan with a market share of approximately 4.5% of total sector assets. [2005-06-08]