Russian Alfa Bank is going to sell its subsidiary in Kazakhstan

Alfa Bank Kazakhstan is negotiating with investors about the sale, the bank reported.

According to Andrei Timchenko, executive director of the bank, the financial organization is doing everything needed to stabilize and improve the situation Alfa Bank Kazakhstan has found itself in. Now the bank is negotiating its sale. More than ten investors are examining the entity’s books; they are going to take a decision very soon.

«No doubt, we can reach a deal and change shareholders in a couple of weeks or even sooner,» he said.

In addition, Alfa Bank wants to sell its loan portfolio to other Kazakhstani banks. Timchenko estimates a possible deal of $223.5 million which will help the bank improve its current position and allow clients to withdraw or transfer their money.

As of March 1, 2022, (data from the National Bank of Kazakhstan), Alfa Bank Kazakhstan was ranked 11th with $2 billion of assets among 22 other banks in Kazakhstan. The loan portfolio for that day was about $1.2 billion or 62.1% of all the bank’s assets. It is 9 p.p. higher than the average rate in the sector (53.1%).

The share of NPL in Alfa Bank is lower, though, by 3 p.p. than the average rate in the sector (3.48%). Moreover, the bank has created provisions for $51.2 million or four times more than NPL ($13.7 million).

Last year Alfa Bank Kazakhstan increased its assets by 19.4% or $328.9 million. The loan portfolio of the bank grew by 58.5% or $460.8 million. In terms of providing loans, Alfa Bank is ranked second (+27.9%) out of 13 AQR participants. At the same time, the rate of NPL in Alfa decreased last year by $4.2 million.

Net revenue of the bank reached $72.9 million in 2021; this takes the fifth result after Halyk Bank, Kaspi, Sber and Forte. This is 32% growth ($17.6 million) if compared to the 2020 result.

On April 6, 2022, the U.S. and the EU imposed blocking sanctions against Sber and Alfa Bank subsidiaries in Kazakhstan. Also, sanctions have been imposed against the key shareholders of Alfa Bank Mikhail Fridman, Pyotr Aven and German Khan. In order to deflect the hit from at least 50% of the bank’s shares, the owners have changed their shares like this: Andrei Kosogov with 40.96% (earlier he owned just 3.7% of shares), Mikhail Fridman 32.86%, Pyotr Aven 12.4%, UniCredit S.p.A. 9.9% and the Mark Foundation for Cancer Research 3.87%. German Khan and Alexey Kuzmichev have withdrawn as shareholders of ABH Holdings SA in Luxemburg.