EBRD has purchased 35% of insurance company Kazkommerts Policy (Kazakhstan)

/REUTERS, Almaty, Oljas Auezov, January 22, 03/ - European bank of reconstruction and development (EBRD) has purchased 35% block of shares of Kazakhstan insurance company Kazkommerts Policy and expressed hope that that measure would give impulse to one of less developed segments of Kazakhstan financial market. Purchasing, agreement about which was signed in Almaty on Tuesday, became the first direct EBRD's investments into shareholders equity in Central Asia and the bank's first project in the sphere of insurance in this region. "We optimistically evaluate perspectives of insurance sector development in Kazakhstan. We will participate in this company and negotiate with authorities about how to improve this market", - said director of EBRD on non-banking financial institutions Jonnathan Vullet at the briefing. European bank, which was founded in 1991 in order to promote to shifting of post-communist states of Europe and former USSR to market's principles of economics, will invest $2.5 m into the project, said Vullet. In December Kazkommerts Policy registered additional shares issue for KZT53.846 m (about $350,000) at the face value, which was purchased by EBRD. In the project's description, which has been placed on EBRD's site, it is said that the banks is ready to pay up to $1.5 m for shares. EBRD wants to invest the remaining funds into further increase of the company's capital. Before the issue the company's authorized capital was KZT100 m and shareholders' equity as of October 1 of 2002 was equal to KZT298 m. The only company's shareholder was Kazkommertsbank - the largest bank in Kazakhstan. Vullet expressed hope that the first project with EBRD's participation in the sphere of insurance would raise interest of the largest world insurance companies in Kazakhstan. "I think, it will be right signal for large insurance companies", - he said. KAZAKHSTAN IS WAITING FOR GIANTS For long time Kazakhstan has been calling foreigners to this market, however still successfully. In Reuter's interview in the end of December of last year the National Bank's head Grigory Marchenko concerned it with worsening of situation at the world insurance services market after events of September 11 of the year 2001 in the USA and expressed hope that in this year already some of international giants would appear in Kazakhstan. He also mentioned about EBRD as an intermediary. "We wants not just let them in (foreign insurance companies), but we want call them. We negotiated with all large western companies either directly or with the help of EBRD or IFC. Some (companies) were interested", - said Marchenko. "External (for Kazakhstan) reasons will gradually disperse, and I think in 2003 already the situation will start changing, and at least one company will come to this market", - hopes the National Bank's head, who estimate gap of Kazakhstan insurance sector from "the best in CIS" banking sector at five-seven years. "At our insurance market there is quantitative growth, everyone can see it - 40% a year. But the occurred no qualitative improvement. In order to have qualitative improvements we have to wait for five-seven years. But it is better - to wait for six years, and may be more, or do it in 2003-2004 due to coming of competitors?" - said Marchenko. Similar situation was told on Tuesday by managing director of Kazkommertsbank Eldar Abdrazakov. "Insurance market is about 5 years behind the banking one", - he said, having characterized it as "the market of insurance brokers". [2003-01-22]