nazer4Kazakhstan will not allow foreign investors to take control over key Kazakh banks, President Nursultan Nazarbayev said in a televised question and answer session on Friday.



"We know that the presence of foreign banks in the country is beneficial. It creates competition, allows lower rates [...] but we will not allow foreign bankers to fully control systemically important banks," Nazarbayev said.


This statement comes amid complicated debt restructuring negotiations between some of the country's biggest banks and their foreign creditors. Three Kazakh lenders, BTA Bank, Alliance Bank and Astana Finance, have gone into default earlier this year and are negotiating restructuring deals that typically involve giving creditors shares in exchange for debt write-offs.


BTA and Alliance, which were the largest and fourth-largest bank, respectively, at the beginning of the year, are considered systemically important banks.


Samruk-Kazyna, the state holding and investment company, which effectively took over both banks in February of this year, said earlier it would look for strategic partners to sell its stakes in both lenders. Russian Sberbank has long been considered a potential suitor to take over BTA, while an unnamed UAE-based private equity fund reportedly showed interest in acquiring a controlling state in Alliance last week.


In addition, BTA creditors are seeking to get a controlling stake in the bank after the restructuring, but the bank has so far balked on their demands.