Financier not worried about asset quality but concerned with interest rates

business and economy

Financier not worried about asset quality but concerned with interest rates

By SRI ⋅ July 7, 2008 ⋅

Chairman of the Association of Financial Professionals in Kazakhstan, Serik Akhanov, says the situation in Kazakhstan’s banking sector is under control.

“The current state of second-tier banks in Kazakhstan in terms of assets and loan portfolio is stable enough,” he said in an interview with.

High interest rates that banks offer to borrowers, however, are more of a cause for concern.

“The main concern is that loan interests are above 18 percent.” He attributed this to rampant inflation of more than 19 percent for the past year.

Akhanov said that the Kazyna Development Fund and the second-tier banks agreed to lower the interest rates under the auspices of the government and the National Bank to an average rate of 12 percent. He believes this agreement will help small and medium-sized enterprises, which, in turn, will increase their borrowings.

Earlier, chairperson of the Financial Supervision Agency (FSA) of Kazakhstan Yelena Bakhmutova claimed that the main concern for the economy was the quality of assets and loan portfolio, and not liquidity.