Kazakhstan Said to Seek Sale of Alliance Bank Stake to EBRD

Kazakhstan wants to sell a stake in Alliance Bank to the European Bank for Reconstruction and Development, potentially making it the first of the Kazakh banks that defaulted during the financial crisis to attract an international investor, said three people familiar with talks.

An agreement on the sale may be reached as early as next month, said one of the people. The three people declined to provide details on the size of the stake or the price and asked not to be identified because the negotiations are private.

Alliance Bank, the first Kazakh lender to default in 2009, completed restructuring $4.5 billion of debt, reducing the amount owed to about $1 billion, the bank said on March 30 of last year. The state-owned National Wellbeing Fund Samruk-Kazyna holds 67 percent of Alliance’s ordinary shares after the reorganization. Alliance is the country’s sixth-largest lender by assets.

Samruk-Kazyna plans to consolidate state stakes in BTA Bank, Temirbank and Alliance Bank in a new management company, central bank Chairman Grigori Marchenko said on April 19. The three lenders defaulted in 2009 after credit markets froze and the country’s property bubble burst.

Alliance Bank narrowed its loss by almost 96 percent to 2.25 billion tenge ($15.5 million) in the first two months from 50 billion tenge in the same period last year, the Kazakh financial regulator said in March, citing unconsolidated data under Kazakh accounting standards.

“Alliance Bank is in talks with a potential investor,” Dmitry Shishkin, a spokesman for the Almaty-based lender, said today by phone, declining to name the buyer. Evgenia Evstegneeva and Tatyana Tyo, EBRD officials in Almaty, both declined to comment when called by Bloomberg News.