Credit FAQ: How Tsesnabank's Cleanup Changed Our Views About Bank And Sovereign Ratings In Kazakhstan

The recent cleanup of Kazakhstan-based Tsesnabank, which was the country's second-largest commercial bank by asset size as of mid-2018, was an important precedent for the banking sector, with material implications for our ratings on domestic banks. Here, S&P Global Ratings answers investors' questions about the ratings on Tsesnabank (TSB) and explains the implications for our views about bank and sovereign creditworthiness in the country. (See the box at the end of the article for how events at TSB played out.) We progressively lowered the ratings on TSB from B+/Negative/B to 'SD' over the past five months, and thereafter raised the ratings to 'B-/Stable/B'. During that period, the bank had tried to sustain its credit quality, withstand deposit outflows, and received

...March 11, 2019 The recent cleanup of Kazakhstan-based Tsesnabank, which was the country's second-largest commercial bank by asset size as of mid-2018, was an important precedent for the banking sector, with material implications for our ratings on domestic banks. Here, S&P Global Ratings answers investors' questions about the ratings on Tsesnabank (TSB) and explains the implications for our views about bank and sovereign creditworthiness in the country. (See the box at the end of the article for how events at TSB played out.) We progressively lowered the ratings on TSB from B+/Negative/B to '##' over the past five months, and thereafter raised the ratings to 'B-/Stable/B'. During that period, the bank had tried to sustain its credit quality, withstand deposit outflows, and received significant extraordinary government support in various forms (including a loan buyout of about Kazakhstani tenge (KZT) 1,054 billion or 2% of the country's GDP)....

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