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UPDATE 1-Kazakhstan revokes licence of small lender Kazinvestbank
December 27, 2016 / 8:55 AM / 9 months ago

UPDATE 1-Kazakhstan revokes licence of small lender Kazinvestbank

* First such move by central bank in a decade

* Kazinvestbank has assets of $574 mln

* Kazakh economy under stress from oil price slump (Adds details, background)

ALMATY, Dec 27 (Reuters) - Kazakhstan’s central bank on Tuesday revoked the licence of Kazinvestbank citing its repeated failures to process payments and money transfers properly.

The central bank said in a statement it had appointed a temporary administrator at the bank and would seek its liquidation. The country’s deposit insurance fund, also controlled by the central bank, would pay out Kazinvestbank’s retail deposits within its insurance limits, the statement said.

With assets of about $574 million, Kazinvestbank ranks as No.20 among the former Soviet republic’s 34 banks. Kazinvestbank did not respond to an emailed request for comment.

The last time Kazakhstan’s authorities took away a bank’s licence was in 2006. Since then several banks have given up their licences voluntarily, usually because of mergers and acquisitions.

After the 2008-2009 global financial crisis, several Kazakh banks defaulted on their debt and were nationalised and kept afloat by capital injections from the state.

The slump in oil prices in the past two years has hit Kazakhstan’s oil-dominated economy, forcing the authorities to abandon an exchange rate peg in August 2015. Since then country’s tenge currency has lost nearly half of its value against the dollar.

The central bank had planned to carry out a banking system-wide stress test this year, but said this month it would only be completed in 2017. (Reporting by Mariya Gordeyeva; Writing by Olzhas Auyezov; editing by Katya Golubkova and Jane Merriman)

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