/IRBIS, Aug 6, 01/ - Today the National Securities Commission of
Kazakhstan (NSC) published results of activity in second quarter 2001 and
review of securities market development in the same period.
The full text is presented at the Internet site of NSC:
http://www.nsc.kz/strategy/reports/.
BONDS MARKET
In second quarter 2001, the NSC registered single emission of corporate
bonds, bonds of Astana-finance OJSC (Astana) for a total of KZT1,464,000.0
th. Bonds are denominated in US dollars.
REGULATING ACTIVITY
The government approved tax legislation proposals of the NSC amending
Tax Code of the Republic of Kazakhstan on June 12, 2001. Among
amendments are cancellation of fees for registration of securities and
movable collateral (including securities); interest income from bonds are
excluded from amount of the annual income figure; expenses incurred during
repayment of interest over corporate securities are to be excluded from
annual gross income; the list of financial institutions exempted from VAT was
enlarged with companies subjected to licensing and whose activity do not fall
into category of professional securities market participants; amendments
clarified notions of "dividends" and "interest rate on securities."
On July 11, 2001, the parliament approved the law "On amendments and
modifications into legal documents of the Republic of Kazakhstan regarding
securities market." According to new amendments, the Stock Exchange will
only coordinate changes into stock exchange trades regulation with its
supervision authority. The previous order was submission on approval. The
same order was set for internal regulating documents of the Central
Depository and other self-regulating organizations of professional market
participants.
The NSC continued development of following laws:
- "On protection of investors rights on the securities market" (under
coordination with interested government departments and bodies)
- "On amendments and modifications into government regulation regarding
securities market and joint-stock companies" (coordinated with interested
government departments and bodies and submitted for examination to the
government of Kazakhstan)
- "On electronic document and electronic digital signature" (coordinated
with interested government departments and bodies and submitted for
examination to the government of Kazakhstan)
- "On joint-stock investment and unit investment funds" (being under
revision regarding proposals of TACIS CIS technical assistance program
"Consulting and development of investment funds in Kazakhstan")
- new versions of law: "On joint-stock companies" (under coordination with
interested government departments and bodies, submitted to the
Government and President Administration)
- new versions of law: "On securities market" (under developemnt).
MODIFICATIONS IN INSTITUTIONAL INFRASTRUCTURE
No significant changes were registered in number of broker-dealers, pension
assets management companies, custodians, training centers, etc.
Number of registrars decreased by 2. In mid-term outlook, number of
registrars could fell further due to development of transfer-agent network,
growing importance of the organized securities market, changes in nominal
holding regulation and expected requirements set for financial adequacy of
registrars.
In second quarter, ABN AMRO Asset Management received a license on
securities portfolio management, one license was recalled. Thus, as of July
01, 2001 there are three companies possessing such licenses, of which two
are combining this activity with pension assets management, and the left one
with broker-dealer activity.
CHANGES ON THE OTC AND ORGANIZED MARKET OF SECURITIES
Volume of deals on the over-the-counter (OTC) corporate securities market
depends on number of IPO or initial public offerings (99.2%).
The official listing of Kazakhstan Stock Exchange (KASE), category "A" has
not recorded any significant changes. Instrument of two companies were
excluded from the listing because of redemption: Almaty Kus OJSC and NSE
Kazakhstan Temir Joly. At the same time, two new instruments were
admitted: bonds of Kazakhtelecom OJSC and preferred shares of AMB
OJSC. Besides, common shares of Astana-finance were transferred from "B"
to "A" category.
Following initial offering auctions were held at KASE: preferred shares of
AMB OJSC (KZT95,614.0 th.) and bonds of East-Kazakhstan municipal
authority (KZT499,995.1 th.).
In the total volume of corporate deals, secondary market deals (excluding
repo sector) amounts to 52.6% and repo deals - 47.4%.
Volume of secondary deals in corporate securities increased 18.5%
compared to first quarter and equaled KZT5,272.7m. The portion of
secondary deals with CS in total volume equals 62.1%.
Compared to first quarter, volume of secondary deals with government
securities (GS) excluding repo deals increased 27.7% and reached
KZT70.7bn. Repo deals fell down 17.5% and equaled KZT116.8bn.
In the sector of trades over bonds of international financial organizations
(IFO) volume of deals equaled KZT26.2m and fell by 95.0%.
From July 01, 2001 KASE has applied new capitalization estimation
methodology. The shares capitalization figure is now estimated using total
market value of companies included only into official listing.
ACCUMULATIVE PENSION SYSTEM
Pension assets in second quarter 2001 increased 11.7% and reached
$985.9m. the portion of private accumulative pension assets increased from
63.5% to 65.4% amounting to $645.2m.
The portion of GS in portfolio of the State Accumulative Pension Fund
(SAPF) equaled 77.1% or $259.8m, the rest was invested into bonds of
international financial organizations and deposits of second tier banks - 3.1
and 19.8% correspondingly.
The portion of GS in private funds portfolios equaled 63.4% or $399.9m.
The portion of CS in portfolio of private funds equaled 26.2%, foreign issue
securities - 4.3%, bonds of IFO - 0.8%, deposits - 5.3%.
The share of PAMC investments into total volume of corporate securities
equals 52.5%.
With a view to transparent disclosure of information regarding activity of
pension system, the NSC and the Pension Asset Regulation Committee
(PARC) under the Ministry of Labor and Social Security developed disclosure
and publishing rules for pension funds and pension assets management
companies. The rules #793 and #23-P were approved by joint resolution of
NSC and PARC on March 11, 2001. First consolidated report was published
on June 28, 2001 in RESPUBLIKA and on June 30, 2001 in EGEMEN
KAZAKHSTAN.
INSTRUMENTS
Equity market indicators changed insignificantly due to tactics of investors.
Number of joint-stock companies with existing emissions of shares equals
2,893, number of valid emissions - 3,212 (compared to 2,822 and 3,162 as of
April 01, 2001).
KASE listing includes shares of 48 joint-stock companies. Their market
capitalization equaled $1,869.8m. Volume of deals reached $42.5m
(including repo deals) or 62.0% of total volume with corporate securities.
At the same time, KASE listing includes 16 emission of corporate bonds of
15 issuers. Market capitalization equaled - $245.9m, volume of deals -
$26.1m (including repo deals) or 38.0% of total volume with corporate
securities.