Samruk-Kazyna, the Kazakh sovereign wealth fund, confirmed
yesterday that it will not bail out beleaguered BTA bank, which
it controls, if it fails to reach agreement with creditors.
Samruks hardball stance piles the pressure on
BTAs lenders to come to an amenable conclusion to talks
on restructuring $15 billion worth of debt.
Samruk is willing to support BTA up to a point,
said Marcia Favale-Tarter, an independent advisor to the
chairman of Samruk and the government on their financial
restructuring strategy. But there is no magic purse of
Favele-Tarter told Emerging Markets that Samruk,
which owns 75% of BTA, was supportive of the debt
restructuring, but that they would not help the bank beyond
Samruks stance, which puts the onus on the banks
142 lenders to keep it afloat, was supported by BTA chairman
Anvar Saidenov, who acknowledged that a full debt guarantee
from the Kazakh government or Samruk would have been very
attractive outcome for creditors.
But Saidenov argued that it was not the governments
responsibility to account for all of BTAs debt, adding
that the bank was private when it took on its debt and
borrowed so much.
Samruks position could spell the liquidation of BTA if
lenders are unwilling to play ball a risk compounded by
the complexity of negotiations.
The number of creditors and financial instruments involved
is one of the main concerns for lenders involved in the debt
talks, and their unwillingness to accept steep haircuts may
also be a stumbling block. Grigori Marchenko, Governor of the
National Bank of Kazakhstan, yesterday described the success of
the restructuring plan as a big if.
But some analysts have been supportive of Samruks
stance, as it could swing the outcome in BTAs favour.
You cannot just expect Samruk to pour $12 billion of the
countrys reserves into BTA, said Luis Costa,
emerging markets analyst at Commerzbank in London. That
would just be too good to be true for bondholders and
However, Costa urged BTAs management to present a
restructuring plan quickly, saying that lenders were
hungry for information and its just taking far too
A London based capital markets banker involved in the talks
told Emerging Markets that Samruks position was
a threat from BTA to the creditors to act in BTAs
interest, which could see it eventually reach a
Saidenov acknowledged that the vast number of creditors
involved in discussions would complicate talks, but said that a
solution could be reached without the consent of the whole
There are many different instruments and a great
number of creditors, but there is no need for the consent of
100% in restructurings, it can be 50% or 75% in certain
cases, he said.