Statement of "Kazkommertsbank" regarding the reasons for possible exclusion of eurobonds of "Kazkommerts international B.V." from the listing

/IRBIS, Sep.08, 99/ - "Kazkommerts international B.V." (Rotterdam, the Netherlands), established by "Kazkommertsbank" on September 01 to attract capital from international monetary markets, applied to Kazakhstan stock exchange with the proposition regarding exclusion of its eurobonds (official list of securities, category "A", XS0081674359, trade code KKGBe1) from stock exchange's trade lists. Today "Kazkommertsbank" gives reasons for possible exclusion of eurobonds of its sub-company "Kazkommerts international B.V." from the listing of Kazakhstan stock exchange. Exclusion of these eurobonds from the listing of KASE is due to current legislature requiring emitters of eurobonds to be resident companies of Kazakhstan. Consequently, certain difficulties are experienced both with inclusion and circulation of these bonds in domestic market and with taxation of non-residents' incomes on securities. Currently, eurobonds are handled mainly by Accumulation Pension Funds which have various preferential terms upon placement of pension assets. For legal entities and private persons these bonds almost unavailable. All these do not allow eurobonds to turn into liquid securities in domestic market of Kazakhstan. Due to the reasons mentioned above "Kazkommertsbank" issues internal bonds which will be available to all legal entities and private persons, to residents and non-residents of Kazakhstan, and will replace those eurobonds circulating mainly in international markets. At this time "Kazkommertsbank" consults with the National Securities Commission of Kazakhstan and with major eurobond holders - Accumulated Pension Funds. Opinions of some stock market participants about impossibility of retaining eurobonds in portfolios of Accumulated Pension Funds and their mandatory sale are premature. Based on verbal consultations held with management of the National Securities Commission, delisting of eurobonds will not mean their mandatory sale by Accumulated Pension Funds. By keeping eurobonds in portfolios pension assets Accumulated Pension Funds will certainly receive expected incomes. "Kazkommertsbank" considers possibility to buy back eurobonds from investors or exchange of non-resident sub-company eurobonds for domestic bonds of the bank.