BTA Bank held a Press Conference05.05.2009 / Press-service
On April 30, Anvar Saidenov, Chairman of the Board of BTA Bank has commented the current situation in the bank related to the temporary stop of principal payments on its external debt as well as answered mass media questions.
We have announced earlier that since April 20 we are stopping all our payments on main debt obligations - said Anvar Saidenov. This includes eurobonds, syndicated and bilateral loans. Along with that we continue to meet scheduled payments of interest. This relates to the fact that accelerated repayments raised by two creditors based on covenants on change of the control and rating decrease. One of those creditors is Morgan Stanley.
The total amount of obligations to be discharged made up USD 550 mn. Together with shareholders we believe that if accelerated repayment would be met then the precedent of unequal attitude towards creditors will take place that might lead to risk in receiving accelerated notices from the rest of creditors, which we will not be able to realize.
Alongside with this, as Mr. Saidenov has underlined, in the view of liquidity the situation is stable and the are no risks in serving customers’ orders, in realizing their transactions and in providing depositors’ interests.
The Bank continues to stable implement public programmes to support economic situation. As of April 29, BTA Bank has drawn down the third tranche for SME support. Moreover, BTA Bank’s investment into SME amounted at KZT23.760bn whereas the government financing was KZT 22bn. As for refinancing of mortgage loans BTA Bank has drawn down KZT 9bn compiling 32,3% out of allocated means to BTA Bank. According to Anvar Saidenov, 75% out of total amount for this program Bank is planning to draw down by the end of May.
Answering the questions of journalists regarding the negotiations with creditors, Anvar Saidenov has underlined the following:
- The further foreign debt repayment proposal will be presented admittedly by mid of May after we discuss it with financial advisors of the Bank. A. Saidenov also added that the bank has received a proposal on some centralization or optimization of the negotiation process. Thus, it’s possible that creditors will be united within the frame of one large or a few committees.
Commenting the issue of given to BTA a “D” rating which means default, the Chairman underlined that there is a clear-cut distinction between default and bankruptcy. – Many people put an “equal” sign between these two terms. Meanwhile, “bankruptcy” – this is insolvency of a debtor to satisfy in full claims of creditors while “Default” means – breach of payment liabilities by the borrower. This is a legal definition, which has nothing in common with general idea that “default” is something close to “bankruptcy”. Once again, the situation in the bank is stable, all obligations are being realized so far. Besides, the public real sector economy support program has been successfully completed. As a result, BTA Bank has drawn down more funds than it were planned earlier.
Journalists also raised an issue of renaming the banks in Moscow and Kiev which are a part of BTA Group.
- BTA Bank (Kazakhstan) intends to prove through the court the illegality of decisions made by Ukraine and Russian BTA Banks’ Shareholders Meetings – commented A.Saidenov. – This is more the issue of a legal dispute therefore we have adequately reacted both to the shareholders meetings’ decisions and to the issue how the BTA Bank’s share is being considered in Ukraine and Moscow BTA Banks. It is a question of how and in what way the BTA share is estimated and whether the shareholders meetings’ decisions are legally acceptable. We have sent legal suits (claims) to Ukraine and Moscow through our advisors. The regulatory bodies were also informed by us on these events both National bank of Ukraine and Center bank of Russia.
According to the Chairman, the issue of BTA Bank’s shareholders claim to Kazakhstan in the amount of USD 3bn will be also a subject of discussion at international courts.
BTA Group is a leading banking network in the CIS.
The network of BTA’s partner banks extends to Russia, Ukraine, Belarus, Georgia, Armenia, Kyrgyzstan and Turkey. BTA’s representative offices operate in Russia, Ukraine, China, UAE and the UK.
The bank has one of the largest branch networks in Kazakhstan (22 branches with 274 service locations) along with an extensive chain of ATMs (787) and self-service terminals (160). BTA serves about 1.2 million retail and 130,000 corporate customers.
For media contacts:
BTA Bank, Brand Office
Public Relations Department,
Tel.: +7 (727) 266-47-99
Fax. +7 (727) 250-12-55