Nov. 23 (Bloomberg) -- Temirbank, a unit of Kazakhstan’s BTA Bank, plans to restructure 211.8 billion tenge ($1.42 billion) in debts after becoming the fourth Kazakh lender to default this year.

Temirbank missed debt payments on Nov. 6 and Nov. 9, according to a statement released today. The default followed the “substantial deterioration” of Temirbank’s loan holdings, which pushed regulatory capital below the required minimum and could have cost the bank its license, the bank said.

“The regulator has agreed not to withdraw the banking license on condition that Temirbank takes urgent steps to secure its satisfactory recapitalization and other steps by the end of December,” Temirbank said in the statement. The state’s National Wellbeing Fund Samruk-Kazyna will become Temirbank’s majority shareholder after the restructuring.

Kazakh banks are restructuring more than $20 billion of debt after Temirbank joined BTA Bank, Alliance Bank and AO Astana Finance, which defaulted in April and May after credit markets froze and the property bubble burst. Kazakhstan, Central Asia’s biggest energy producer, has spent $19 billion to prop up its banking system and economy since the end of 2007.

Samruk-Kazyna acquired a 75.1 percent stake in BTA in February and will gain control of Alliance after its debt restructuring is complete. The fund also owns 26.5 percent of Astana Finance. Temirbank is Kazakhstan’s 10th-biggest bank.

Finance Minister

Kazakhstan Finance Minister Bolat Zhamishev said today that there probably won’t be any more “surprises” regarding defaults as other banks meet regulations.

The “banking sector today, as far as we know, is not going to produce any surprises of this kind,” Zhamishev said at a conference in New York. “We don’t have any signs of weakness in the banking sector.”

The Financial Supervision Agency and the Specialized Financial Court of Almaty have approved plans to restructure Temirbank’s debt. The ruling suspended any claims against Temirbank and prohibits foreclosure on the bank’s property, according to the statement.

The restructuring will involve international bond guarantees and domestic bonds, some trade finance transactions and certain related-party obligations, the Almaty-based bank said in the statement. Spokesman Arken Abdugali declined to give a further breakdown of the debt to be restructured.

Widening Losses

Temirbank had a 10-month net loss of 110.8 billion tenge ($745 million), compared with a loss of 389 million tenge in the same period last year, according to figures compiled under Kazakh accounting standards and posted on the Financial Supervision Agency’s Web site. The bank’s assets dropped to 205 billion tenge as of Nov. 1 from 301 billion tenge.

The bank’s liabilities exceeded its assets by 61.2 billion tenge as of Nov. 1, the regulator said.

BTA Bank owns 55.6 percent of Temirbank, according to the Kazakhstan Stock Exchange. BTA creditors face losses of as much as 82.25 percent under a proposal to restructure $10.3 billion of debt. The Almaty-based bank aims to reach a preliminary agreement with a creditors committee by Dec. 7.

To contact the reporter on this story: Nariman Gizitdinov in Almaty at ngizitdinov@bloomberg.net

Last Updated: November 23, 2009 12:57 EST