Kazakhstan’s economic growth may be 6% of GDP in 2012, according to Standard & Poor’s analysts. Both corporate and banking sectors provide substantive support for economic development.
Kazakhstan’s economic growth may be 6% of GDP in 2012 with a stable sovereign credit rating. These projections were voiced by analysts from Standard & Poor’s international credit rating agency at a conference in Almaty. While speaking of the financial sector, S&P experts noted stable and improved quality of assets of second-tier banks. Experts predicted that although credit institutions will not show rapid growth, they will gradually move up to the level of 10-15% by the end of this year.

Natalia Yalovskaya, Associate Director, Financial Institutions, Standard & Poor’s
«We can now observe some interesting trends: the big banks are not growing because they are dealing primarily with their troubled assets where they channel their key resources for. It’s interesting that small banks that didn’t have major problems before the crisis are growing now, though they don’t yet play a big role in the market. So the most interesting trends occur in the middle segment. These are the banks that have a fairly good position in the market and have the resources to grow in the future.»

As for mobilizing funds for further development of businesses, analysts pointed to the growing interest of Russian investors and did not exclude the possibility of non-resident banks appearing in the country. Experts also noted that financial institutions dramatically changed their appetite for risks in lending, which may change the market structure in the future.

Natalia Yalovskaya, Associate Director, Financial Institutions, Standard & Poor’s
«Retail lending, i.e. consumer loans, mortgages, etc. were an important growth factor before the recession. Now we expect corporate loans to grow in the first place. And so far, it’s been an absolute and clear trend. Before the crisis, many banks wanted to grow through the retail sector. Now we see that banks are careful about this segment and will continue to work with the corporate segment. At the same time, specialized banks, which figured out how to work with the retail sector, are developing and showing good results.»

Investment ratings in the corporate sector remain high with national holding companies as well as production and service companies. The level of government support is the main factor in this respect.

Sergei Gorin, Leading Analyst, Infrastructure Finance Ratings, Standard & Poor’s
«All companies are subject to a large-scale investment program. This, in turn, creates a significant need for external capital and external borrowing. As a result, some companies have their debts growing, but then again, the ratings are high enough now, so it means that they are growing within quite tolerable limits.»

S&P analysts referred to an open access to external capital markets, high liquidity, and active interaction with the banking sector as additional incentives for companies to grow and maintain high ratings.
 

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