Kazakhstan to increase the requirements on capitals of pension funds

/IRBIS, March 13, 00/ - REUTERS informs, with the reference to the vice chairman of pension funds activities regulation committee, that the government mandated accumulative pension funds of Kazakhstan to increase their charter capital up to KZT180 mln ($1.27 mln) for open funds and KZT50 mln ($353.8 th.) for corporate funds. "We increased the requirements on pension funds, since pension assets are growing and it is a matter of their safety", said Eset Butin. He said the last charter capital requirements had been KZT90 mln for open funds, and KZT20 mln for corporate ones. The chairman of the committee Altynbek Umbetov said these measures could be explained and they were not administrative pressure. He said pension funds had to have enough capital to ensure the safety of the assets of the depositors, and he gave an example of the banks whose requirements are constantly increased by the National Bank of Kazakhstan. The chairman said the decision was made to increase the requirements on authorized capital, not shareholders' equity, since not all pension funds are profitable and it would be hard for them to capitalize on their income. Umbetov said they had made a decision to strengthen the funds due to their shareholders. He mentioned the possibility of merging some of the funds as the capitalization requirements increase with an increase in pension assets. Pension funds should be financially strong in order to compete with each other, he added. As of March 1, 2000 pension accumulations of the state and 15 private pension funds reached KZT70.527 bln ($500 mln), informs the committee.