S&P Affirmed National Maritime Shipping Co. Kazmortransflot (JSC) Governance Score At 'CGS-4+'

/Standard & Poor's, Moscow, May 04,09/ - Standard & Poor's Governance Services said today that it affirmed its corporate governance score (CGS) at CGS-4+'on the Kazmortransflot (JSC) (KMTF), a national maritime shipping company of Kazakhstan. "KMTF demonstrates positive developments in several areas, including board procedures and overall transparency," said Standard & Poor's governance analyst Elena Pastoukhova. "However, we also note recent precedents of shareholders taking an hierarchical approach to decision-making at KMTF, which represents a step backward in terms of building strong governance practices." The overall CGS on KMTF is the result of four component scores on the global scale of 1 (low) to 10 (high). For each component the score is shown in brackets: - ownership structure and external influences 5 (lowered from 5+); shareholder rights and stakeholder relations 5 (lowered from 6) - transparency, disclosure, and audit 4+ (raised from 4) - board structure and effectiveness 4+ (raised from 4) Standard & Poor's has identified several weaknesses in the company's governance system, including: There is a lack of checks and balances on the board level. Independent directors have limited ability to influence board decisions. The slow decision-making process within the shareholder group of companies may cause significant delays in strategic decisions by KMTF. Due to considerable debt before NC KMG, KMTF is highly dependent on its parent in terms of debt financing. Consequently, KMTF has limited independence in its financial policies. The internal audit function was transferred to the parent level in 2008. This is viewed negatively from the perspective of the ability of internal audit to function in the interests of all stakeholders. There is a relatively low level of on-going disclosure. Additionally, the Website has only a Russian version and IFRS financials are published without notes. There are drawbacks in general shareholder meeting procedures. In 2008 the annual general shareholder meeting was conducted with a three month delay. The main strengths of corporate governance practices at KMTF are: The two current shareholders of KMTF, state-owned fund Samruk-Kazyna and its 100% subsidiary NC KMG, support the development of KMTF. Although KMTF provides services to related entities, there are no indications that their terms are unfair to KMTF. The shareholders of KMTF encouraged the company to develop strong governance practices in several areas, including the board procedures. An international reputable firm audits KMTF's financials. An audit committee chaired by an independent director with relevant experience supervises the audit process. The board and its committees are fairly active. There are two highly professional independent directors on the board. The opinions expressed are the independent opinions of S&P's Governance Services, a department of Equity Research Services, and do not reflect the opinions of other areas of Standard & Poor's. Standard & Poor's Corporate Governance Scores, GAMMA scores and other analytic services are performed as entirely separate activities in order to preserve the independence and objectivity of each analytic process. Information on Corporate Governance Scores and GAMMA scores, including the related report "Corporate Governance Score: KMTF JSC" is available at www.governance.standardandpoors.com. Alternatively, call one of the following Standard & Poor's numbers: Moscow (7) 495-783-4000/40. Contact: Elena Pastoukhova, Moscow (7) 495-783-40-94; Svetlana Borodina, Moscow (7) 495-783-40-40; Oleg Shvyrkov, Moscow (7) 495-783-40-45; GROUP E-MAIL ADDRESS Governance@standardandpoors.com [2009-05-04]