Kazakhstan's Alliance Bank to discuss debt restructuring Dec. 13 -source

ALMATY Tue Dec 10, 2013 9:46am EST

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ALMATY Dec 10 (Reuters) - Kazakhstan's Alliance Bank, controlled by the oil-rich nation's sovereign wealth fund, will discuss the restructuring of its debt at a creditor meeting in London this week, a source at the bank said on Tuesday.

Alliance, the ninth-largest lender by assets among the Central Asian nation's 38 banks, defaulted on its debt in the aftermath of the 2008 crisis. Its dollar bonds fell to record lows earlier this year on fears that it was heading towards a second debt restructuring.

Kazakhstan, the second-largest post-Soviet oil producer after Russia, weathered the financial crisis without sliding into recession, but non-peforming loans still make up more than 30 percent of the loan portfolio of local banks.

The bank, in which state investment fund Samruk-Kazyna holds a 67 percent stake, announced on Monday that it would hold a meeting with its investors on Friday to discuss its "current financial situation".

It said it had appointed law firm White & Case and investment bank Lazard Freres as legal and financial advisors . It invited holders of its debt, shares and global depositary receipts to the investor presentation. It gave no further details at the time.

But a source at the bank, who asked not to be named, told Reuters on Tuesday: "The talks with creditors are supposed to be held about debt restructuring. It is premature to talk about any concrete parameters now."

Contacted by Reuters, Samruk-Kazyna declined to provide immediate comments.

Alliance's dollar bonds due 2017 and 2020 were trading at two-month lows around 53 cents on the dollar on Tuesday but were above record lows around 40 cents hit in October.

Kazakh billionaire Bolat Utemuratov is in the process of buying a large minority stake in Alliance from Samruk-Kazyna, which will retain control of the bank at an initial stage.

Utemuratov also plans to acquire Temirbank, the country's 13th largest lender, which is 79.9 percent controlled by Samruk-Kazyna after it was bailed out by the state during the financial crisis.

Utemuratov, whose business interests include luxury real estate in Moscow, owns Kassa Nova and ForteBank, the 27th and 28th banks in Kazakhstan respectively.

By merging them with Alliance and Temirbank, he intends to create one large bank. The central office of this united bank could be later moved to the new Kazakh capital Astana, the Alliance source said, giving no further details. (Reporting by Mariya Gordeyeva in Almaty and Carolyn Cohn in London; Writing by Dmitry Solovyov; Editing by Douglas Busvine and Louise Heavens)

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