BTA Bank: A Complex History of Bankruptcy and Recovery

BTA Bank's history is a complex one, marked by bankruptcy and recovery. The bank was founded in 1990 and was one of the largest banks in Kazakhstan.

BTA Bank's troubles began in 2009 when it faced a severe liquidity crisis due to a large portfolio of bad loans. The bank's assets were valued at $12.5 billion at the time.

The bank's management was criticized for its handling of the crisis, and in 2013, the bank's assets were restructured as part of a debt-for-equity swap. The swap allowed the bank to restructure its debt and avoid bankruptcy.

The restructuring effort was led by the Kazakhstan government, which injected $2.5 billion into the bank in exchange for a majority stake.

In 2010, BTA Bank sought bankruptcy protection from U.S. creditors to restructure $11.6 billion of debt incurred due to alleged mismanagement and embezzlement by former Chairman Muktar Ablyazov.

This move was a crucial step in the bank's financial recovery, allowing it to address its significant debt burden.

BTA Bank's financial situation improved significantly after it was purchased by the Samruk-Kazyna Fund in 2009, which provided the bank with additional capital of KZT 251.3 billion.

The fund's purchase of 75.1% of BTA Bank's shares was a key contingency measure by the government of Kazakhstan to stabilize the bank's finances.

By 2010, the bank's indebtedness had decreased from $16.65 billion to $4.2 billion, a substantial reduction in its debt burden.

The bank's restructuring efforts continued in 2012, resulting in the cancellation of certain financial indebtedness and the issuance of new notes to creditors.

As part of the restructuring, BTA Bank entered into a revised Revocable Committed Trade Finance Facility (RCTFF) with liabilities of around $348 million.

Samruk-Kazyna Fund also extended a $1.592 billion loan to BTA Bank, which was subordinated to the new notes and RCTFF.

The bank's recapitalization efforts were successful, with Samruk-Kazyna Fund increasing its share in the bank's equity to 97.3%.

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BTA Bank's restructuring process was quite challenging but ultimately successful, and it's now a stable and sustainable financial institution.

In 2013, the bank received a significant net income of KZT 15.579 bln. during the first six months of the year.

The bank's management board underwent a change in June 2013, with Mr. Kadyrzhan Damitov being appointed as the new chairman of the management board.

A major merger was announced in February 2014, where BTA Bank would merge with Kazkommertsbank to become the largest bank in Central Asia.

The Kazkommertsbank and its chairman, Kenes Rakischew, acquired 46.5% of BTA Bank's shares from the Kazakh state holding company Samruk-Kazyna for 72 billion Tenge.

In December 2021, BTA Bank sold 100% of "Nord Star", the operator of Vitino seaport in Murmansk Oblast, to Vladimir Golubev, co-owner of "Adamant" holding.

BTA Bank has a strong network of strategic partner banks across several countries. One of the key partners is Joint-Stock Bank BTA Kazan OJSC from Tatarstan.

BTA Bank has also established partnerships with BTA Bank PJSC from Ukraine, BTA Bank CJSC from Belarus, and BTA Bank JSC from Georgia, all of which are part of the BTA Bank group. This network allows for a wider reach and more opportunities for growth.

Here are some of the key strategic partner banks:

Kenes Rakishev is the largest shareholder of BTA Bank, owning a staggering 93.28% of the placed shares and 97.79% of the voting common shares.

He acquired this massive stake after a group of Kazakh businessmen led by Mukhtar Ablyazov, who previously held 58% of the bank's shares, lost control.

Yerzhan Tatishev's family, who held 11% of the shares, was also involved in the bank's ownership structure before his murder in 2004.

The European Bank for Reconstruction and Development, IFC, and FMO held minority stakes in the bank.

Kenes Rakishev was elected as the chairman of the board of directors on 14 February 2014.

Yelena Bakhmutova serves as the chairman of the board of directors, with a background in management at Samruk-Kazyna JSC.

Kadyrzhan Damitov took over as the chairman of the management board on 5 August 2013.

Our strategic partners play a vital role in helping us achieve our goals.

We have a strong network of partner banks across several countries, including Kazakhstan, Ukraine, Belarus, Georgia, and Armenia.

One of our key partners is Joint-Stock Bank BTA Kazan OJSC from Tatarstan.

We also have partnerships with BTA Bank PJSC from Ukraine, BTA Bank CJSC from Belarus, and BTA Bank JSC from Georgia.

In addition to our BTA Bank partnerships, we work closely with BTA Bank CJSC from Armenia.

Another important partner is Şekerbank T.A.Ş. from Turkey.

Here are some of our strategic partner banks:

BTA Bank is a Kyrgyzstani bank with a long history dating back to 1991. It was established as the country's first private bank.

The bank's headquarters is located in Bishkek, the capital city of Kyrgyzstan. BTA Bank has over 100 branches across the country.

BTA Bank has expanded its services to include corporate banking, investment banking, and asset management. Its products and services cater to individuals, businesses, and institutions.

BTA Bank has a strong presence in the local market, with a significant share of the Kyrgyzstani banking sector. It has a reputation for providing reliable and efficient banking services.

BTA Bank's management team has implemented various strategies to improve the bank's performance and competitiveness.

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Disputes with BTA Bank can be a challenge, but the bank has a process in place for resolving them.

The bank's dispute resolution process involves a review of the complaint by a dedicated team, which can take several weeks to complete.

BTA Bank has been involved in several high-profile disputes over the years, including a lawsuit against the government of Kazakhstan, which was eventually settled out of court.

In 2018, JSC V and Madiyar Ablyazov, son of Mukhtar Ablyazov, were involved in a dispute.

The case was related to a loan of $2.5 million that Madiyar Ablyazov had taken from JSC V.

The loan was guaranteed by Mukhtar Ablyazov, who was the former chairman of BTA Bank.

Mukhtar Ablyazov had been found guilty of embezzling $5 billion from BTA Bank.

Madiyar Ablyazov was unable to repay the loan, and JSC V sought to recover the debt.

The court ruled in favor of JSC V, ordering Madiyar Ablyazov to repay the loan.

Mukhtar Ablyazov's involvement in the case was significant, given his previous conviction.

Claremont Holding Ltd, a company controlled by Frank Monstrey, has settled a dispute with BTA Bank over its stake in Nostrum Oil & Gas PLC.

The dispute involved a $4 billion judgment against Mukhtar Ablyazov, former chairman of BTA Bank, which led to a freezing order on Claremont's shares in Nostrum. The order was lifted as part of the settlement agreement.

BTA Bank acquired 3.76% of Nostrum's shares from Claremont, reducing Claremont's stake to 9.44%. This was a result of the agreement between the two parties.

Claremont and BTA Bank agreed that BTA Bank or its subsidiaries may acquire Claremont's remaining 9.44% stake in Nostrum in the future, subject to certain conditions.

In 2009, it was revealed that a bank was defrauded of up to $6 billion in one of the world's biggest cases of financial fraud.

The bank's former chairman, Mukhtar Ablyazov, is alleged to have perpetrated the fraud. He claimed that under his leadership, the bank concealed assets to protect them from being seized by the government.

Private investigators were used to try and recover some of the funds.