BTA Bank

BTA Bank (BTA Bank Joint-Stock Company in full) is a Kazakhstan bank with headquarters in Almaty. As of 2013 it was the third largest lender by assets.[1] In 2009, BTA Bank was subject of one of the world's biggest financial frauds totaling US$5 billion.[2]

History

Foundations and early years

Following the dissolution of the Soviet Union in 1991, the Kazakh operations of the Soviet Promstroybank were re-organized as Turan Bank and those of the Soviet Vnesheconombank were re-organized as Alem Bank.[3] On 15 January 1997, Turan Bank and Alem Bank merged to form Bank Turan Alem (BTA), a joint-stock company in accordance with the Decree of the Government of the Republic of Kazakhstan "On reorganization of the Kazakh joint-stock bank Turan Bank and joint-stock bank Alem Bank Kazakhstan".

Events between 2009–2012

Fraud & Embezzlement

It was revealed in 2009 that the bank was defrauded of up to $6 billion of cash in one of the world's biggest cases of financial fraud.[4] The bank's former chairman Mukhtar Ablyazov is alleged to have perpetrated the fraud. Ablyazov has said that under his leadership BTA did conceal assets to protect them from being seized by the government. Private investigators have been used in an attempt to recover some of the funds, who in October 2010 found documents and disc drives relating to the bank in a self-storage facility in north London. A found documents and disc drives relating to the bank in a self-storage facility in north Londonthrough which BTA had transacted.[5]

Bankruptcy

BTA Bank sought bankruptcy protection in 2010 from U.S. creditors while it restructured $11.6 billion of debt.[6] The debts were incurred by alleged mismanagement and embezzlement by former BTA Bank Chairman Muktar Ablyazov.[4]

Restructuring

In February 2009 Samruk-Kazyna Fund purchased 75.1% of BTA Bank's shares as part of contingency measures of the government of the Republic of Kazakhstan. As the result the bank gained additional capital of KZT 251.3 bln.

During 2009–2010 BTA Bank has completed restructuring of its certain financial indebtedness. As the result the bank's indebtedness decreased from $16.65 bln. to $4.2 bln, Samruk-Kazyna Fund's share in the capital increased up to 81.48%, both domestic and foreign creditors became the Bank's shareholders holding 18.5% in the capital.

Due to aggravation of the Bank's financial status during 2011, relative shortage of liquid assets and negative financial performance, in 2012 BTA Bank started the second restructuring which resulted in cancellation of the Bank's certain financial indebtedness. In consideration, the creditors received $1,618 cash and $750 mln. New Notes.

BTA Bank also entered into a revised Revocable Committed Trade Finance Facility (RCTFF) with liabilities amounting to around $348 mln. as of the restructuring date. Samruk-Kazyna Fund extended $1.592 bln. loan to BTA Bank JSC subordinated to the New Notes and RCTFF.

During the restructuring BTA Bank was recapitalized for around $10 bln. Share of Samruk-Kazyna in the Bank's equity increased up to 97.3%. Creditors' share amounted to 2.5%, share of minority shareholders, who held shares prior to 2009–2010 restructuring, amounted to 0.2% of the Bank's shares in aggregate.

native name	БТА Банкі
native name lang	kk
type	Joint-stock company
industry	Financial services
foundation	1991
location city	Almaty
location country	Kazakhstan
key people	Yelena Bakhmutova (Chairman of the board of directors), Kadyrzhan Damitov (Chairman of the Management Board)
services	Banking services
net income	KZT 15.6 bln. (30 June 2013)
assets	KZT 1,621 bln.
equity	KZT 287.4 bln. (30 June 2013)
homepage	http://bta.kz, http://бта.қаз

History

Foundations and early years

Events between 2009–2012

Fraud & Embezzlement

Bankruptcy

Restructuring

Fraud & Embezzlement

Bankruptcy

Restructuring

Events after 2013

Activities

Shareholders and management

Structure

See also

References