Press room

3 June 2021, Almaty. Standard & Poor's International Rating Agency (the “Agency”), affirmed the ratings of JSC Halyk Bank (the “Bank”) at "BB/B" level, forecast "Stable" and national scale rating of the Bank "kzA+"  based on the stable indicators of operating activity.

In particular, the Agency experts explained that despite the volatile environment and difficult epidemiological situation associated with the spread of COVID-19 in 2020 the Bank demonstrates a significant improvement in asset quality and steady progress in reducing the volume of NPLs. The Bank managed to reduce the portfolio of distressed assets both in absolute and relative terms. This has largely been achieved due to the Bank's proactive approach to distressed assets taken over by the Bank following its acquisition of Kazkommertsbank in 2017. Provisioning of distressed assets still amounted to 60%, which is, according to Standard & Poor's, a satisfactory level, given the volume of collateralization of the Bank's assets. In this regard, Standard & Poor's revised its assessment of the Bank's risk position from “moderate” to “adequate”.

The Bank demonstrates a stable ability to generate profit, and despite the difficult market conditions, the Bank's ROE has remained above 22% for the last 5 years. S&P believes that thanks to its dominant market position, efficient cost management and gradual success in resolving problem loans accumulated in previous years, the Bank's ROE is likely to remain above 15% in the next 12-18 months, even if the Bank starts to increase the amount of provisions within problem loans.

Experts note the Bank's high cost efficiency, with a "non-interest expense/operating income" ratio of less than 30%, which is better than that of comparable Kazakhstani and foreign banks, and they expect this trend to continue in the future.

S&P considers the Bank's funding performance to be "above average" for comparable Kazakh banks, reflecting the Bank's diversified deposit base and the largest market share in Kazakhstan - 34%. The Bank's established reputation as a national savings bank and the fact that it is considered the most reliable during periods of domestic market volatility have a positive impact on its performance. Usually, when other banks experience deposit outflows, the Bank's deposit volume grows

S&P estimates the Bank's liquidity indicators as "strong". The Agency expects that the Bank will maintain large liquidity reserves during the next years. According to Agency experts' estimates, liquid assets currently account for 46% of the total assets of the Bank, and it will not decrease to less than 40% in the next two years.    

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JSC Halyk Bank is a leading financial group in Kazakhstan, operating in various segments, including retail, SME and corporate banking, insurance, leasing, brokerage and asset management. The Bank has been listed on the Kazakhstan Stock Exchange since 1998, on the London Stock Exchange since 2006 and on the Astana International Exchange since October 2019

As of 31 March 2021 the Bank assets amount to KZT10,389.6 billion, making it the leading credit institution in Kazakhstan. The Bank has the largest customer base and branch network – 600 branches and offices across the country. The Bank operates in Georgia, Kyrgyzstan, Russia, Tajikistan and Uzbekistan.

PR Service of JSC Halyk Bank

Tel. +7 727 259 0301, +7 727 3301719 | pr@halykbank.kz | www.halykbank.kz