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Successful Completion of the Main Stage of Negotiations Between JSC BTA Bank and Its Creditors

22.12.2009

JSC BTA Bank is pleased to announce that it has successfully completed the main stage of negotiations with its creditors by signing in London, on December 7 the Principal Commercial Terms Sheet of the Financial Restructuring of the Bank.

"We made a great step towards renovation of the financial institution by signing this document which testifies absolute consent on all commercial terms between the Bank and its creditors - said Anvar Saidenov, the Chairman of the Management Board of JSC BTA Bank. - Now we may easily state that the period of ambiguity for the bank is in the past. At present new complex tasks are in front of us the decision of which would allow reestablish key positions of BTA Bank in the market”.

In accordance with the signed document, depending on the category of the creditor within the restructuring, suggested options for creditors are arranged into four, main packages – so called Senior Debt as well as two packages of Junior Debt.

Senior Package 1 will include claims on a major portion of Bank’s bonds, loans and part of trade finance debt for the amount of US$ 7.7 billion. This debt Package will be restructured by paying out funds of US$ 946 million, by issuance of eight-year tenor debt instruments with 70% discount and fifteen-year tenor subordinated debt instruments. In addition, creditors will receive 8.7% of the bank’s shares.

The claims of export-credit agencies, liabilities of BTA to other official government sector organizations and also part of other liabilities due to Non-ECA Eligible Trade Finance creditors will be included into the Senior Package 2. Total amount of liabilities restructured within the Senior package 2 amounts to US$ 1.6 billion. This package envisages issue of special debt instrument – so called Original Issue Discount Instrument (OID). In addition to OID creditors under this package will be offered 15-year tenor subordinated debt instruments in the amount of US$ 105 million, and 1.8% of the bank’s shares.

Moreover the creditors of the abovementioned packages (Senior Package 1 and 2), will receive part of the proceeds which the Bank would get from the collection of bad assets, including those through the court.

Senior Package 3 will include liabilities related to trade finance in the amount of US$ 700 million. This package considers refinancing of liabilities through a new 2-year tenor Revolving Committed Trade Finance Facility (RCTFF).

Senior Package 4 is designed for Islamic Finance Creditors (US$ 250 million). This package considers repayment of debt through cash in the amount of US$ 54 million, i.e.21.5% of principal restructured.

Two additional packages – Junior Package 1 and 2 are designed for Kazakh pension funds and holders of subordinated and perpetual bonds of the Bank. The pension funds are offered subordinated debt instruments of KZT 28 billion or US$186 million equivalent (denominated in Tenge) with a twenty-year tenor. The holders of subordinated and perpetual bonds (total amount of US$ 1.1billion) will receive 4.5% of shares of BTA.

The restructuring of BTA Bank will result in formation of additional regulatory capital in the amount of US$ 11.13 billion by reduction of debt and conversion of the part of the debt into the share capital. This will be reached by the joint efforts of creditors and the National Welfare Fund ‘Samruk Kazyna’ (SK) as the principal shareholder of the Bank. NWF Samruk-Kazyna will convert US$ 4.5 billion debt of BTA into share capital. Following the restructuring, Samruk Kazyna will own 85% of the Bank’s shares and the creditors – 15%.

As of the date of completion of restructuring, the amount of debt instruments of BTA to the creditors will equal to US$ 4,564 million, and US$ 797 million will represent subordinated debt.

The Restructuring Plan of BTA with options offered to the creditors has to be presented for approval at the creditors meeting by 23 March 2010.

Media Contacts:
+7(727) 312 2426, 2664797, 2505378
e-mail: pr@bta.kz
www.bta.kz