Agency of Republic of Kazakhstan for Regulation and Development of Financial Market withdraws license of Capital Bank Kazakhstan to carry out banking and other transactions and activities in securities market

/KASE, June 25, 2021/ – The Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market has published on its website a press release dated June 25, 2021 with the following content: quote In accordance with the resolution No. 74 of the Board of the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market (hereinafter – the Agency) dated June 24, 2021, a decision was made to revoke the Bank's license to conduct banking and other transactions and activities in the securities market, issued by the Agency. The grounds for revoking the license, in accordance with subparagraphs 7), 15), 16) of paragraph 1 of Article 48 of the Act of the Republic of Kazakhstan "On Banks and Banking Activities in the Republic of Kazakhstan", were: – systematic (three or more times within twelve consecutive calendar months) violation of prudential standards and (or) other mandatory standards and limits; – systematic (three or more times within twelve consecutive calendar months) failure to comply with supervisory response measures; – failure of a major participant of the Bank to comply with the requirements of the authorized body for additional capitalization; – assignment of the bank to the category of an insolvent bank. The size of the Bank's assets as of the date of revocation of the license amounted to 38.5 billion tenge, the loan portfolio – 33.9 billion tenge, including 30.4 billion tenge, or 89.8 % of the Bank's loan portfolio was represented by non- performing loans overdue for more than 90 days. The size of the Bank's liquid assets is 149 million tenge, while the volume of outstanding customer payments exceeds 15.0 billion tenge. In connection with non-compliance with prudential standards, the Agency took 29 supervisory response measures in relation to the Bank and drew up 67 protocols on administrative offenses. In 2020, the Bank's shareholder presented an Action Plan to improve the financial condition of the Bank. As part of the implementation of this Plan, under the strengthened control of the Agency, the Bank during 2020 and 2021 reduced the Bank's liabilities to depositors in the amount of 31 billion tenge. As part of the implementation of the Plan, obligations to socially significant institutions (schools and hospitals) and a significant part of obligations to the quasi-public sector were also fully paid off. However, the measures taken by the Bank and its shareholder did not lead to stabilization of the Bank's financial position. The Bank continues to violate prudential standards and does not fulfill its payment and transfer obligations to the Bank's clients. Deposits of 99% of the Bank's depositors, individuals, are covered by the guarantee of Kazakhstan Deposit Insurance Fund in full. By order No. 206 of the Chairman of the Agency dated June 24, 2021, a temporary administration was appointed, to which the powers of all management bodies of the Bank were transferred. The provisional administration will operate until the appointment of the Bank's liquidation commission. Sholpan Tokseitova, an employee of the Agency, was appointed the head of the provisional administration. From June 25, 2021, all operations on bank accounts of customers and the Bank itself have been terminated, except for cases provided for by the legislation of the Republic of Kazakhstan. The Agency, in accordance with the procedure established by the legislation, will apply to the court with an application for the compulsory termination of the activity (liquidation) of the Bank. From the date of initiation by the court of the case on the forced liquidation of the Bank, creditors' claims against the Bank may be presented only in liquidation proceedings, with the exception of claims related to the current costs of maintaining the Bank and other cases established by the legislation of the Republic of Kazakhstan. For all questions of interest, you can contact the temporary administration of Capital Bank Kazakhstan JSC by phone +7 (727) 331 66 77. External Communications Department of the ARDFM: +7 (727) 2701090 e-mail: PRESS@finreg.kz gov.kz, finreg.kz unquote [2021-06-25]