OREANDA-NEWS. December 13, 2010. Standard & Poor's Ratings Services said that it affirmed its 'B-' long-term and 'C' short- term global scale counterparty credit ratings on Kazakhstan-based Tsesna Bank. At the same time, we revised the outlook on the bank to stable from negative and raised the national scale rating to 'kzBB-' from 'kzB+', reported the press-centre of KASE.

"The rating actions reflect Tsesna Bank's weak asset quality, vulnerability to political sensitivities, low capitalization, high lending and deposit concentrations and, as with other Kazakh banks, a need to strengthen corporate governance," said Standard & Poor's credit analyst Annette Ess. "However, we consider these weaknesses to be partly offset by the bank's good market position in central and northern Kazakhstan, as well as its improved funding and liquidity positions, including meaningful growth in customer deposits and what we view as an acceptable level of liquid assets."

The ratings are based on the bank's stand-alone credit profile and we do not currently apply any uplift for extraordinary parental or government support, which we consider uncertain. Tsesna Bank is the 12th largest bank in Kazakhstan by assets, which stood at Kazakhstani tenge (KZT) 209 billion (USD1.4 billion) as of Sept. 30, 2010.  In our view, the bank holds a good market position in  central and northern Kazakhstan, where its market share was 5% by term deposits and 11% by loans, compared with an overall market share of 2% by assets.             

"The stable outlook reflects our view that improved macroeconomic growth prospects over the medium term and a stabilized operating environment have reduced the external pressures on the bank's financial and business profiles," said Ms. Ess, "which in turn have led to a more stable operating performance."