WASHINGTON, D.C., Oct. 10-The International
Finance Corporation (IFC) has committed an equity investment of US$9 million
for a 15 percent shareholding in Eximbank Kazakhstan. As part of this privatization,
Bank Bumiputra Berhad Malaysia will invest US$21.6 million and government
ownership will be diluted from 100 percent to 49 percent.
Following the capital increase, Eximbank's US$60 million equity will be
as follows: government of Kazakhstan 49 percent, Bank Bumiputra 36 percent
and IFC 15 percent. The Kazakh government is committed to selling its remaining
stake and a share package is expected to be listed on the Kazakh Stock
Eximbank Kazakhstan is one of the largest banks in Kazakhstan and its transfer
to new management and ownership is a key component of the government's
reform plan for the financial sector. This privatization will establish
a well-capitalized, commercially focused bank whose purpose will be to
partially address the absence of effective financial intermediaries in
Privatization will enhance Eximbank's capacity for term lending and enable
it to address the financing needs of Kazakh companies. Furthermore, technical
assistance by Bank Bumiputra will bring Eximbank in line with international
standards and help raise the Kazakh banking sector's overall level of service
by reducing systemic risk.
"We hope that the privatization and restructuring of Eximbank Kazakhstan
will create a model institution, the successful completion of which will
have a key demonstration effect," said Mr. Andre Hovaguimian, Director
of IFC's Central Asia, Middle East and North Africa Department.
Bank Bumiputra Berhad Malaysia is the second largest bank in Malaysia.
Although fully owned by the Malaysian government, it operates along commercial
lines. The Bank Bumiputra Group has activities in leasing, factoring, merchant
banking, and portfolio management.
IFC, a member of the World Bank Group, is the largest multilateral source
of equity and loan financing for private sector projects in developing
countries and transitioning economies.