A new investor of Valyut-Transit-Bank JSC intends to invest $50 m. in its capital; a change of its name is expected; in three years this financial institution wants to enter LSE

/INTERFAX-KAZAKHSTAN, Almaty, November 28, 06, title of IRBIS/ - A new investor of Kazakhstan commercial Valyut-Transit-bank (VTB) - company BPA International is going to invest $50 m. in its capital. This contribution will be fulfilled within the planned extra issue of shares, informed Steve Johnson, a chairman of the Board of directors of VTB, who represents BPA International. "The state completely supports us. We constantly hold meetings with AFS (the state agency for financial supervision. - IF-K), communicate with the National bank. By the end of January we plan to complete negotiations about stabilization of the situation in the bank, and as a part of our agreement with the state we enter into a commitment on capital injection into the bank in the amount of USD50 m.," he said in the interview to the agency Interfax- Kazakhstan, newspaper Panorama and Business & Power. "We would not agree to bear such a risk, if we did not have confidence that we can stabilize the situation with the bank and the bank overcomes the crisis," noted S. Johnson. According to his information, issue of shares is planned to be fulfilled at the beginning of next year. "If everything is according to plan, it is supposed to happen in the middle of January," he said. According to his words, as a result of this issue either company BPA International or he himself - S. Johnson, will become the biggest shareholder of VTB. Currently he formalizes documents to get the status of the big participant of VTS from AFS. S. Johnson informed that Talgat Yermegiyayev, current big shareholder of the bank, who owns 28% of shares, intends to sell his share. At present time S. Johnson owns 32.4% of shares of VTB, which he bought from the investment group Seymar. Besides, Nurzhan Bekshenov, an entrepreneur, owns the share holding in the amount of 9%. The rest number of shares belongs to a big group of physical and juridical people. S. Johnson called the present staff of shareholders of VTB "temporary". "We plan to conduct restructuring of the capital. We also have particular doubts about some previous issue of shares - how much legal they were. Correspondingly our opinion is that it is necessary to clear the situation with the corporatization, and therefore, currently we work with legal experts on this issue," said the interlocutor. Besides, S. Johnson again emphasized that VTB reckons on getting the stabilization loan from the National bank of the republic. "We hope that the state will render an assistance to us in the form of the stabilization loan. Currently a scheme, according to which we will be given the stabilization loan, and a scheme, by which we will be able to legally invest money, which we want to invest, in bank's capital, are at the stage of agreement with the state bodies," he said. As it was reported, earlier S. Johnson stated that VTB needs a large amount of money, which is necessary to the bank for top-priority projects, including repayment of debts. Thereupon, he came out with an offer to give the bank the stabilization loan in the amount of KZT10 bn. (current 127.94/$1). Meanwhile, representatives of AFS claimed that before the issue about giving the loan to VTB is considered shareholders and investors of the bank must invest adequate funds in its capital, and the leadership - to present a corresponding plan of actions on correction of the situation in VTB. In AFS it was also emphasized that the volume of unexecuted obligations from bank's side is very significant. Thereupon, S. Johnson informed that the new leadership of VTB at present time agrees with big creditors upon postponement of debt payments. "We get a serious support from all financial institutions of Kazakhstan. All financial institutions - not only banks, but also pension funds, state institutions - creditors of Valyut-Transit sign agreements with us about restructuring of credits for amore long time. Actually, according to entered engagement, financial institutions give us a year for solution of current problems," told the interlocutor. Thus, according to his information, by today several corresponding agreements have been signed on postponement of debt repayments until the end of 2007, and some until the end of 2008 for a total of KZT12 bn. In the meantime, bank intends to agree with clients upon postponement of debt payments for a total of KZT18 bn. "None of financial institutions refused to us, which is an additional confidence indicator for us," he stressed. Besides, continues S. Johnson, the leadership of VTB conducts work on return of assets, which were illegally taken out of the bank by its former owner Aytbaky Belyalov, who writes himself Andrey Belyalov and is now under house arrest. Along with this, he imparted, a process of return of credits, which were illegally given by the bank, has started. "We talk about KZT40 bn, according to which we submitted a claim on return," remarked S. Johnson in this connection, having reminded that on these facts of "illegal entrepreneurship and fraud" the General Prosecutor's office has opened a number of criminal cases. "We cooperate with the General Prosecutor's office on return of bank's branch network. First positive results have been already obtained, although we as the management of the bank actually work only one month. We have returned funds that were spent on construction of bank's headquarter in Astana not quite in legal way. These are first $18 m., which we could return to the bank," he remarked. Current leadership is to discharge obligations of the bank, firstly to its investors, by means of funds, which it is going to gain from sale of a part of the branch network, non-core assets, in particular, of an accumulative pension fund and Lombard business. "We already carry on negotiations with different Kazakhstan banks, which are interested in the acquisition of these assets," said the interlocutor. Thus, according to his data, it is planned to gain about $16 m. from sale of the pension fund, Lombard business - about $60 m., and the value of the part of the branch network, which is planned to be sold, is estimated by bank's leadership at the least at $100 ь. S. Johnson at that stressed that the whole process on sale of property and bank's assets will be transparent. "And in the future we plan to carry on business very openly and according to western standards," he added. The interviewee told that bank's leadership negotiated with the International financial corporation about inclusion of VTB in its program of corporate management development and plans to complete negotiations with EBRD about possible partnership. "We want to become the partners of EBRD," stated S. Johnson. "We are not going to sell shares to EBRD. We plan to borrow it as the partner for the technical help," he specified, having not excluded, however, in the perspective the possibility of addressing of VTB to EBRD for attracting credit resources. S. Johnson also informed that in the coming week the leadership of VTB is going to come to an agreement with AFS about a program on work with bank's investors, payment on clients' deposits. According to his information, the total volume of deposit portfolio of the bank is KZT21 bn. Talking about plans for the future, S. Johnson informed that bank's activity will be oriented on the work exactly with retail clients. "We intend to work primarily with physical people, to occupy with autocrediting, mortgage crediting. We will try to minimize bank's corporate portfolio until possible. We have already started developing products, which we will offer to clients next year. The idea is that the name Valyut-Transit must vanish, and beginning from the new year a new bank with the new name, a new approach, new ideas must appear," he told. Thus, informed the interviewee, on December 7 of current year a meeting of shareholders of VTB is planned, on which it was outlined to adopt a decision on the change of bank's name and about transfer of its juridical address from Karaganda to Almaty. Relative to the more long-term perspective S. Johnson informed "in 3 years it is planned to bring the bank to the London stock exchange" (LSE). BPA International offers services of financial consulting in the commercial banking, has specialists in financial and trading services for the market development support of countries with the transition economy. The company is introduced in Great Britain, UAE, Ukraine, Slovakia, Czechia, Kazakhstan. [2006-11-28]