Moody's announces rating impact of revised policy on foreign-currency ceilings for financial institutions in Kazakhstan
30.05.06 21:56
/REUTERS, May 30, 06/ - Moody's Investors Service published today the
results of an examination of financial institution ratings in Kazakhstan
in light of the revision of its rating methodology for assigning foreign
currency country bond ceilings.
In November 2005, Moody's published a Request for Comment, entitled
"Revised Policy with Respect to Country Ceilings". Based on supportive
market responses Moody's decided to revise its methodology for
assigning foreign currency country bond ceilings.
The revised methodology resulted in upgrades to the foreign currency
bond ceilings of a number of countries. The higher ceilings reflect
Moody's view that in many countries, even if the government were to
default on its own foreign currency debt, the probability of a foreign
currency moratorium is less than 100%. For a detailed discussion of
Moody's new policy please refer to Moody's Rating Methodology entitled
"Revised Foreign-Currency Ceilings to Better Reflect Reduced Risk of a
Payments Moratorium in Wake of Government Default", published on
May 24, 2006.
Most of the foreign currency debt and foreign currency issuer ratings that
are now being upgraded were previously constrained at the old foreign
currency debt ceilings. This constraint reflected Moody's earlier view of
the risk that such obligations could be captured by a foreign currency
payments moratorium in the event the government defaulted on its own
foreign currency debt. Following the upgrades, a number of these ratings
(those below the new foreign currency debt ceiling of the issuer's or its
parent bank's domicile) are no longer constrained by this risk. Other
ratings are being upgraded to the new ceiling but remain constrained by
the moratorium risk still reflected in the revised ceilings.
Today's rating actions have no impact on any foreign currency deposit
ratings. The revision to Moody's methodology applies only to the foreign
currency ceiling for bonds and notes. Existing foreign currency country
ceilings for bank deposits are not affected. Moody's foreign currency bank
deposit ceilings will continue to be more directly related to government
foreign currency bond ratings, reflecting the risk that a freeze on foreign
currency bank deposits is more likely to be imposed in the event of a
government bond default even in the absence of a generalized foreign
currency moratorium.
Below is a list of affected financial institutions in Kazakhstan including
the rating changes resulting from the application of the methodology. The
parent company is listed, with the rated entity in parentheses, the rated
class of debt, the change in the rating, and the rating outlook.
- Development Bank of Kazakhstan -
Issuer Rating (foreign currency) - upgraded to Baa1 from Baa3; Outlook
changed to Stable (STA) from Under Review for Upgrade (RUR)
Senior Unsecured Debt Rating (foreign currency) - upgraded to Baa1
from Baa2; Outlook changed to STA from Positive (POS)
- Kazkommertsbank (Kazkommerts International B.V.) -
Senior Unsecured Debt Rating (foreign currency) - upgraded to Baa1/P-2
from Baa2/P-3; Outlook remains STA
Subordinated Debt Rating (foreign currency) - upgraded to Baa2 from
Baa3; Outlook remains STA
- Bank TuranAlem (TuranAlem Finance B.V., BTA Finance Luxembourg S.A.) -
Senior Unsecured Debt Rating (foreign currency) - upgraded to Baa1
from Baa2; Outlook remains STA
Subordinated Debt Rating (foreign currency) - affirmed at Baa2/STA
Junior Subordinated Debt Rating (foreign currency) - affirmed at
Baa3/STA
- Halyk Savings Bank of Kazakhstan (HSBK (Europe) B.V.) -
Senior Unsecured Debt Rating (foreign currency) - upgraded to Baa1
from Baa2; Outlook remains STA
London
Adel Satel
Managing Director
Financial Institutions Group
Moody's Investors Service Ltd.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Moscow
Andrey Naumenko
Vice President - Senior Analyst
Financial Institutions Group
Moody's Eastern Europe
Telephone: +7-495-771-7146
Facsimile: +7-495-937-8290
[2006-05-30]