kulibaev tim(SRI) - The government is ready to inject more funds into BTA Bank if required, Timur Kulibayev, head of the state-owned holding and investment company Samruk-Kazyna, said on Wednesday, Bloomberg reported.

 

"BTA Bank will certainly be supported by the government," Kulibayev told Bloomberg. He did not elaborate how Samruk-Kazyna would inject money into the bank.

 

Samruk-Kazyna holds an 81.5% stake in BTA after it took over the lender in a bailout in 2009. It has already invested KZT883 billion ($6 billion) to raise BTA's equity capital in 2009 and 2010 and prop up the struggling bank.

 

Yet, BTA has struggled to return to profitability since the government takeover, as it remains burdened by non-performing commercial loans and punishing debt. It has lost $331 million in the first half of 2011, and another roughly $27 million in July and August, according to data calculated using the International Financial Reporting Standards (IFRS). As of the end of August, the bank has faced a capital shortfall of almost $500 million, according to IFRS data published by the National Bank of Kazakhstan on Monday.

 

While BTA has insisted it will not need additional capital from the state and will turn its fortunes around, analysts warned that a cash injection will be necessary to deal with the bank's bad loans, a prerequisite for any future growth.

 

 

SRI


 

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