Fitch Ratings on March 12 downgraded various ratings of four Kazakhstan-based banks, saying the imposition of a restructuring of senior unsecured creditors of Tsesnabank JSC had changed its view of the likelihood of government support for private banks in the country.
The long-term foreign- and local-currency issuer default ratings of ATFBank JSC and Bank CenterCredit JSC were downgraded to B- from B, with their short-term foreign-currency issuer default ratings affirmed at B. The agency also downgraded the lenders' support ratings to 5 from 4 and revised their support rating floors to B- from B.
The rating agency also revised the support rating floor of JSC ForteBank to B- from B and that of JSC Halyk Savings Bank of Kazakhstan to B from B+, downgraded ForteBank's support rating to 5 from 4 and affirmed Halyk Bank's support rating at 4.
Although the senior unsecured Tsesnabank creditors that were bailed in were state-owned, Fitch said it still views such events as a so-called restricted default, and that the Tsesnabank case had altered its perception of "the likelihood of a bank resolution involving a distressed debt exchange, or other forms of bail-in of third-party senior unsecured creditors, especially when the scale of asset quality problems at the affected bank is particularly large."