Which Kazakh banks have been awarded high ratings from world agencies?
The banking sector of the Republic of Kazakhstan demonstrates stability and positive dynamics, despite the pandemic and the global crisis, Standard.kz reports, citing Finprom.kz. While many industries have faced unprecedented challenges, Kazakhstan's banks remain resilient. By the end of October this year, the assets of second-tier banks of the Republic of Kazakhstan amounted to 36 trillions tenge, an increase of 19.2% compared to the same period last year.
At the same time, the portfolio of individuals' deposits continues to expand. By November, the amount of household deposits had already reached 12.6 trillion tenge, which is 20.6% more than in October 2020. Over the past five years, the amount of deposits has been growing by an average of 11.5% per year.
According to the KFGD study, the most important factors for Kazakhstanis when choosing a deposit are:
• the size of the remuneration rate;
• convenient mobile banking;
• reputation of the bank;
• assessments of rating agencies.
If the first three criteria are obvious, and two of them are to a large extent subjective, then the fourth, most important, is worth explaining. The bank's credit rating shows how the bank is able to meet its obligations to clients, and is awarded not within the Republic of Kazakhstan, but by international independent agencies such as Moody’s, Standard & Poor’s and Fitch Ratings.
Otbasy Bank and Halyk Bank have the best ratings among the TOP-10 STBs of the Republic of Kazakhstan in terms of the amount of deposits.
Recall that Otbasy Bank specializes in the system of housing construction savings, and such a high rating, which confirms the stability of the financial institution, is an extremely important indicator for those who plan to become the owner of their own home with the help of the bank's programs.
In August this year, the rating agency Moody's upgraded the high rating of Otbasy Bank from Baa3 to Baa2, with a “Stable” outlook. In March this year, the Fitch rating agency improved the bank's rating from BBB− to BBB, as a result of which Otbasy Bank became the only financial institution with a country rating among the second-tier banks of the Republic of Kazakhstan.
The upgrade of the bank's rating reflects its increased systemic importance after receiving a new status of a national development institution, strengthening of market positions in the local mortgage lending segment, as well as the opinion of rating agencies on increasing the government's ability to support the bank's depositors, if necessary. However, Otbasy Bank is unlikely to need extraordinary capital support in the medium term, given its robust asset quality and strong capital cushion. The bank's funding is low cost and long-term. A moderate cushion of liquidity is sufficient for the bank to comply with contingent liabilities in relation to the issuance of mortgage loans in the coming years.
Halyk Bank, in turn, shows good results: the financial institution's credit rating has increased from Baa3 to Baa2 from Moody's, from BB to BB + from S&P and from BB + to BBB− from Fitch. Sberbank, Kaspi Bank and Alfa-Bank are also included in the TOP-5 STB of the Republic of Kazakhstan according to the best ratings from world agencies.