BTA Still Seeks Debt Talks After Restructuring Isn’t Passed
Kazakh lender BTA Bank said it will push ahead with talks to restructure its debt for the second time in as many years even after a shareholders meeting today failed to gain enough votes to begin the process.
The results of the meeting in Almaty are “certainly not an impediment to achieving restructuring and the bank will continue to take all the necessary steps,” BTA said in a statement. Majority owner Samruk-Kazyna, the Kazakh sovereign-wealth fund, couldn’t back any resolutions on the agenda as an insufficient number of depositary-receipt holders voted, it said.
Samruk-Kazyna “is committed to an orderly and consensual restructuring of the bank,” according to a separate statement e-mailed by the fund. It “supports the establishment of a steering committee to negotiate the terms of the restructuring of a certain part of the bank’s financial debt.”
Samruk-Kazyna took over BTA in February 2009, two months before the central Asian nation’s largest lender at the time defaulted on $12 billion of debt. BTA missed a $166 million coupon payment at the start of the month on its July 2018 dollar bonds, according to data compiled by Bloomberg.
Debt Moratorium
Today’s general shareholders meeting was convened to discuss non-payment of interest on bonds and a “moratorium on certain payments” to BTA’s creditors, excluding depositors, according to an earlier statement on the bank’s website.
In order for Samruk-Kazyna to support the moves, two-thirds of the holders of BTA’s London-listed global depositary receipts needed to vote in favor of the resolutions, BTA said today. Just under 18 percent of the GDR holders voted, representing 2.7 percent of the lender’s common stock, it added.
Samruk-Kazyna, which has a stake of about 81.5 percent, said it’s “disappointed that a majority of the bank’s GDR holders have not been able to give their voting instructions.” Still, the fund plans to participate in restructuring talks once a steering committee is established “with a view to having the bank emerge as a viable entity post-restructuring.”
It reiterated a pledge to exclude depositors and their interest payments from any restructuring.
Fitch Ratings downgraded BTA’s long-term issuer rating one level to “restricted default” on Jan. 20, citing the bank’s failure to pay its coupon by a Jan. 18 deadline.
BTA said Fitch’s decision was fair, calling restructuring “a necessary step to guarantee the continued normal functioning of the bank,” according to a statement the following day.
BTA’s Chief Executive Officer Askhat Beisenbayev warned Jan. 17 that the lender planned to skip the coupon payment because it has an “acute need to restore capital” and faces the risk of a run on deposits.
The bank is making a presentation to creditors tomorrow in London.
To contact the reporter on this story: Svetlana Antoncheva in Astana at santoncheva1@bloomberg.net;
To contact the editor responsible for this story: Hellmuth Tromm at htromm@bloomberg.net
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