MOODY'S ASSIGNS BA2 RATING TO ALLIANCE BANK'S (KAZAKHSTAN) SENIOR UNSECURED NOTES ISSUE; STABLE OUTLOOK
08.06.05 11:08
/REUTERS, London, June 8, 05/ - Moody's Investors Service has assigned a
Ba2 long-term rating to the upcoming issue of senior unsecured notes by
Alliance Bank. The amount of the issue is expected to be US$150 million
with a tenor of three years. The rating is subject to reviewing the final
documentation on the issue. The outlook for the rating is stable. The bank's
existing Ba2 (stable outlook) long-term foreign currency deposit rating, Not-
Prime short-term rating and E+ (positive outlook) financial strength rating
remain unchanged.
The Ba2 rating is based on the bank's fundamental credit quality, which
factors in a limited degree of support from the Kazakhstani authorities in
case of need, given the bank's strengthening franchise and increasing
importance to the national banking system. Moody's notes that, while the
predictability of such support is still relatively low, this is nevertheless
captured in the bank's Ba2 rating.
Under the terms of the bond issue, Alliance Bank must comply with certain
covenants, such as negative pledge, limitation on payment of dividends,
limitation on mergers and sale of assets and maintenance of a minimum BIS
Capital Adequacy Ratio of 10%.
Alliance Bank is headquartered in Almaty, Kazakhstan, and reported total
assets of US$922 million and capital of US$123 million under IFRS at 31
December 2004. Following three years of rapid growth, Alliance Bank ranked
sixth-largest by assets and fifth-largest by capital in Kazakhstan as at year-
end 2004, with shares of the system's total assets and shareholders' equity
at 4.5% and 6.0%, respectively.
[2005-06-08]