kazakhstans-banks-pursue-risky-strategies

Kazakhstan's banks pursue risky strategies

Fitch Ratings says the aggressive growth strategies employed by Kazakhstani banks may pose credit risks.
The aggressive growth strategies of Kazakhstani banks are giving rise to heightened credit and structural risks, argues Fitch Ratings in a report issued yesterday.

Fitch points out that expansion seems likely to remain rapid, at least in the short-term, based on revised forecasts collected from rated banks. This growth will test the banks' credit risk management capabilities and any significant deterioration of asset quality could result in negative actions on banks' Individual ratings, says Fitch.

Relatively new retail lending and loans to the potentially cyclical construction and real estate sectors are the main growth drivers, with exposures to Russian borrowers also substantial at certain banks, says Alexei Kechko, associate director in Fitch's financial institutions group....
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