S&P Placed Four Kazakh Banks On CreditWatch Developing On Government Acquisition

/Standard & Poor's, Frankfurt, February 03, 09/ - tandard & Poor's Ratings Services said today it placed on CreditWatch with developing implications its long-term counterparty credit ratings on Kazakhstan-based BTA Bank J.S.C. (BTA) and its two subsidiaries Temirbank JSC and BTA Ipoteka Mortgage Co., and on Alliance Bank JSC (Alliance; see ratings list below). These rating actions follow the Kazakh government's announcement of its decision to acquire a 78% stake in BTA through an injection of $2.07 billion of new equity and a 76% stake in Alliance by buying shares from existing shareholders. Samruk-Kazyna National Welfare Fund and Alliance signed an agreement for the placement of a $200 million deposit with the bank. We believe that, given the status of BTA and Alliance as systemically important banks, further support would be forthcoming if needed to further stabilize their financial condition. "We remain concerned about the continuing downward pressure on the banks' stand-alone creditworthiness from asset quality deterioration, which is depleting their capitalization, as well as continuous funding and liquidity challenges," said Standard & poor's credit analyst Annette Ess. The Kazakh government expects its ownership of the banks to be temporary, but at this stage, the strategy and timing of the government's exit, which might be protracted, is unclear. With total assets of $29 billion at Sept. 30, 2008, BTA is the second-largest Kazakh bank. With total assets of $8.4 billion on Nov. 1, 2008, Alliance ranked fourth among banks in Kazakhstan. "We expect to resolve CreditWatch placement on obtaining further clarification of the banks' stand-alone creditworthiness, as well as further details of the government ownership, support, and strategy for these two banks and their subsidiaries," said Ms. Ess. We will continue to closely monitor the stand-alone ratings on the banks in the coming months, with a particular focus on the banks' asset quality, capitalization, and liquidity. RATINGS LIST Ratings Affirmed CreditWatch/Outlook Action To From BTA Bank J.S.C Long-Term Counterparty Credit Rating BB/Watch Dev BB/Negative Short-Term Counterparty Credit Rating B B BTA Ipoteka Mortgage Co. Long-Term Counterparty Credit Rating BB-/Watch Dev BB-/Negative Short-Term Counterparty Credit Rating B B National Scale rating kzBBB+/Watch Dev/ kzBBB+/--/-- Temirbank JSC Long-Term Counterparty Credit Rating B+/Watch Dev B+/Negative Short-Term Counterparty Credit Rating B B National Scale Rating kzBBB/Watch Dev/ -- kzBBB/--/-- Alliance Bank JSC Long-Term Counterparty Credit Rating B+/Watch Dev B+/Negative Short-Term Counterparty Credit Rating B B N.B. This list does not include all ratings affected. Primary Credit Analyst: Annette Ess, CFA, Frankfurt, (49) 69-33-999-157; annette_ess@standardandpoors.com Secondary Credit Analysts: Magar Kouyoumdjian, London, (44) 20-7176-7217; magar_kouyoumdjian@standardandpoors.com Ekaterina Trofimova, Paris, (33) 1-4420-6786; ekaterina_trofimova@standardandpoors.com Additional Contact: Financial Institutions Ratings Europe; FIG_Europe@standardandpoors.com [2009-02-04