Kazakhstani banks report increase in assets

As of April 1, 2023, the combined assets of 21 commercial banks in Kazakhstan grew by 2.2% and reached $100.5 billion. According to the Agency for Regulation and Development of the Financial Market (ARDFM) in Kazakhstan, a 2.7% increase ($1.1 billion) in liquid assets is the key driver of this growth.

Since January 1, 2023, the banking sector’s assets have grown by 1% or $1.1 billion. As of April 1, these highly liquid assets accounted for a third of all assets ($29.7 billion). Thanks to these assets the banks can meet their liabilities. As of April 1, their liabilities grew by 2.3% to $86 billion.

In March, banks reported a 1.2% increase in equity capital ($12.4 billion). Since January 1, 2023, this rate has grown by 8.7%. The banking sector has also reported a coefficient of equity adequacy at 22.6% and fixed capital at 19.5%. These figures are significantly higher than the requirements. So, potential risks of the sector are fully covered, according to the ARDFM.

The agency said that the quality of the loan portfolio of Kazakhstani banks is stable. In March, the number of nonperforming loans (NLP 90+) was about 3.4% of the loan portfolio ($1.8 billion) while banking provisions for nonperforming loans reached 80.6%.

As the ARDFM reported, the country’s banking sector issued $50.8 billion worth of loans for businesses in March, which is 1.1% more than in February and 1.5% more than in January. The amount of loans nominated in tenge has grown by 1.4% to $47 billion while loans in foreign currency declined by 2.5% ($3.7 billion) due to regular payouts by clients.

In March, entities reported 0.3% more loans than in February ($18.6 billion). As of April 1, 2023, businesses, including small businesses, received $21 billion of loans, which is 0.8% more than in February and 0.5% less than in January. Medium-sized and small businesses and big companies account for $13 billion (+1.6%) and $7.8 billion (-0.6%) in loans, respectively.

Individuals also showed a bigger appetite for loans. In March, they received $31.9 billion (+1.6%) in loans (+3.3% since January 2023). This growth was driven by an appetite for consumer loans ($17.3 billion or +2%). On the other hand, mortgages dropped by 0.3% to $10.5 billion in March.

In March, Kazakhstanis deposited 3% more money than in February ($67.2 billion), including $32.8 billion by entities (+4.3%) and $34.3 billion by individuals (+1.8%), although the weighted average interest rate on deposits has changed neither for entities (14.5%) nor for individuals (13.5%).

«In March 2023, deposits nominated in the national currency tenge grew by 3.7% to $47.3 billion while deposits nominated in the US dollar rose by 1.3% to $19.9 billion. As a result, the dollarization rate decreased and was 29.8% as of April 1, 2023. For comparison, in January 2023, it was 31.6%,» the agency said.

As of April 1, 2023, there were 21 commercial banks in Kazakhstan, including 12 banks with foreign stakeholders and eight subsidiaries of foreign banks.