The FINANCIAL - Bank TuranAlem: largest single transaction for the Kazakh issuer

Bank TuranAlem: largest single transaction for the Kazakh issuer

Bank TuranAlem: largest single transaction for the Kazakh issuer

The FINANCIAL -- JPMorgan and Standard Chartered Bank announced completion of securitization (emission) for Bank TuranAlem for the amount of $750 mlln. This emission is made by a specialized financial company BTA DPR ("emission") and is a first issue in the international market of borrowings in accordance with Bank’s program on bonds issue secured by Diversified Payment Rights (DPR). Three of four emissions under the program are insured.

This securitization is the largest single transaction for the Kazakh issuer.
ABN AMRO Bank N.V. and Standard Chartered Bank were co-agents to keep the register and together with JPMorgan stood as organizers of this transaction. Each of the bond issues of 2007-А, 2007-В, 2007-С and 2007-D series is insured by dedicated insurers which guarantee a duly repayment of the principal debt and accrued interest.


Series Amount S&P/Moody's Insurer Maturity Mid term

2007-A US$200 mln. AAA / Aaa FGIC 2015 5.6 years
2007-B US$200 mln. AAA / Aaa MBIA 2015 5.6 years
2007-C US$200 mln. AAA / Aaa Ambac 2015 5.6 years
2007-D US$150 mln. BBB- / Baa3 NA 2015 5.6 years


Bank representatives said, DPR securitization program is an important supplement to BTA’s efforts to enter into international market of investments which gives the Bank an access to cheaper international funding sources. Transaction structure as well as availability of dedicated insurers were crucial factors for successful transaction completion and let the Bank to place its bonds at the price which is considerably lower than current prices for BTA risk.

“This transaction clearly shows BTA’s adherence to its strategy on diversification of funding sources. The Bank has attracted totally new investors and what is more important – showed its ability to continue the program of external attractions despite the current situation in the world markets”, bank reported.

According to BTA, transaction funds will be used for common corporate aims and will not be sent to financing current outstanding amounts as BTA will not repay the loans in short-term perspective.

BTA succeeded in completion of the transaction given the capital market experienced strong psychological pressure after S&P’s reports on possible review of country’s ratings and bank’s rating outlook. This confirms great confidence of investors in Bank TuranAlem in general.
Actually, GDP growth in the fist half of 2007 amounted to 10,2%, nominal salary growth up to 28%. In January-August 2007 investments into share capital totaled to some 1783,7 bln. KZT.
As at September 01, 2007 according to non-audited consolidated balance, the Bank’s assets grew by 50,91% up to 24 659 mln. USD, loan portfolio by 76,74% - up to 18 695 mln. USD.

With that, Bank’s liabilities grew by 45,62% up to 21 562 mln. USD including customers’ deposits by 48,14% up to 6 161 mln. USD. Bank’s capital grew by 102,09% up to 3 097 mln. USD. Bank’s net income totaled to 373 mln. USD which made an increase by 73,64% versus to the analogous period of the last year. Capital adequacy ratio is К1 – 14.30%, К2 – 15.81%.

“For the period beginning with the August crisis in the global markets the Bank took several measures to increase financial discipline: a thorough analysis of existing loan agreements and facilities. The emphasis was made on cashless financing under BTA guarantees with foreign banks. The Bank made a great job with major borrowers”, company said.

The bank together with customers refinanced some projects through foreign banks. Swap operations with the National Bank of the Republic of Kazakhstan and short-term in the interbank market.

As the result the volume of past due loans amounted to less than 1% of the loan portfolio volume, share of 10 major borrowers comprised 14,9% of the bank’s portfolio.

The Bank has a good liquidity. Liquid assets totaled to 19.73% of the assets.

Bank successfully repaid a bridge loan for the amount of 600 mln. USD in the middle of September and was able to reach agreement on step-by-step refinancing of the half of this amount with the maturity period up to 10 years. The Bank also made regular interest repayments on early issued Eurobonds with different maturities for the total amount of about 41,6 mln.USD.
Till the end of the year the bank shall repay around 30 mln. USD on its internal liabilities.




Ads on Banks