Struggling crisis

/KASE, October 22, 08/ - The National Bank of the Republic of Kazakhstan made a decision to increase the charter capital of Kazakhstan Deposit Guarantee Fund from KZT30 bn. to KZT100 bn., Anvar Saidenov Chairman of the Board of the National Bank informed at the press conference in Almaty. The decision has been made in accordance with an order of the President of Kazakhstan Nursultan Nazarbaev, in accordance with which the maximum sum of individuals' deposits in commercial banks of the republic guaranteed by the state in case of force-majeure will be increased to KZT5 m. This norm will be effective three years. The decision will come into effect after approval of corresponding changes into current legislation of the republic. In addition, Chairman of the Board of the National bank of Kazakhstan informed that a decision on reduction of minimum reserve requirement (MRR) for commercial banks for liquidity support purposes will be made Friday at the Board meeting. According to his words, MRR is being discussed currently: "Banks have suggested, like this has been done Russia, to reduce norms to 0.5 %. We will not make such a radical decision. This instrument is flexible enough, and if we consider, that reduction has not produced the required effect on support of liquidity, then we can make a change fast enough". At that, according to Saidenov, MRR will be made softer in such a manner as to release approximately KZT200-400 bn. for commercial banks. The Minister for Economy and Budget Planning of the Republic of Kazakhstan Bakhyt Sultanov informed that implementation of measures on state support of economy will allow for the Kazakhstan government stabilizing market situation and reaching mid-term macro economical indicators planned for the three years, informed information agency Interfax-Kazakhstan. According to the message B. Sultanov informed that the government is expecting international rating agencies to adequately consider the measures taken. According to Sultanov, in 2007-2008 for purposes of support of social and economical stability in the country $10 bn. more will be released from the National Fund and $5 bn. - at the expense of monetary and credit policy of financial agencies. [2008-10-22]