By Marcus Williams

Cem Habib, a partner and head of the fund of hedge funds business at Cheyne Capital, has quit the firm to join an investment bank in Kazakhstan.

The Turkish born financier Habib will work in a private equity role with a Kazakh investment bank, according to a Reuters report.

Habib, whose missus had dalliances with Hugh Grant and Prince Andrew amongst others, won’t be foresaking quite all of Mayfair’s pleasures for the Kazakh steppes. Apparently, he will spend 10 days a month there and does not plan to fully relocate to Central Asia.

Cheyne manages around $5 billion in assets, which probably doesn’t include much in Kazakhstan.

Antal Russia, the recruiter, is opening an office in Kazakhstan to cater for opportunities in the Central Asian country and its neighbours.

The group is returning to Almaty having closed its Kazakh office in 1999 after four years of operation.

Michael Germershausen, Antal Russia Managing Director, said: “This is the first step in our regional expansion strategy, and we hope to be able to open offices in other CIS countries in the near future.”

Natalia Kurkchi has been appointed Country Manager of Antal Kazakhstan’s office in Almaty, which is the part of the international recruitment group FiveTen. Group

By Ivan Anzerzhanov

Britain’s Royal Bank of Scotland sold its Kazakhstan business to HSBC for $52 million (£35m) in its third emerging market disposal.

RBS Kazakhstan includes four branches, two support offices, 490 staff and personal customer loan and credit card portfolios. HSBC has been operating in Kazakhstan since 1998 and has 250 staff there.

The sale follows the group’s recent disposal of its Pakistan unit to Faysal Bank and its retailing banking business in the United Arab Emirates to Abu Dhabi Commercial Bank.

HSBC said it will also offer employment contracts to about 490 of RBS Kazakhstan’s banking staff.

Simen Munter, chief executive of HSBC in Kazakhstan, said in a statement: “This acquisition reflects HSBC’s positive view of Kazakhstan’s long term prospects, not least because of its trade flows with China. We have been in Kazakhstan for 12 years and today’s deal significantly increases our platform for growth by doubling our network and growing our customer base fivefold.”

RBS said it will continue to have presence in Kazakhstan, focused on corporate and investment banking.

By Ivan Anderzhanov

The European Bank for Reconstruction and Development and the World Bank’s International Finance Corporation are launching a €300m fund to help structure medium-size companies in eastern Europe and central Asia.

The EBRD said it will contribute €60m to the ADM CEECAT Recovery Fund, with the IFC adding €35m. They will be joined by the Netherlands Development Finance Company, which will contribute €15 million.

The €300 million fund will initially target companies in Kazakhstan, Romania, Turkey, and Ukraine with loans and equity investments of between €10-30 million.

Robert Appleby, one of the founding partners of ADM Capital said, “The fallout of the recent financial crisis in this region has created an environment where ADM Capital’s style of investing can flourish. Many of the issues faced by companies operating in the CEECAT region have strong parallels with issues faced by companies in Asia post the 1998 crisis.”

By Andrei Skvarsky

Alexander Stepanov, a co-owner of Russian energy equipment producer Energomash, has been sentenced to two years imprisonment by the High Court in England for trying to dodge his commitments under a defaulted loan agreement with Kazakhstan’s largest bank BTA.

The bank claim Stepanov, a former general director of Energomash (UK) and its main shareholder, resorted to forgery in fighting a case with BTA, which defaulted on a $365m loan in March last year.

The High Court in October 2009 ordered Stepanov in October 2009 to pay $468m to BTA, which was formerly called Bank TuranAlem or Turalem, and on March 31, 2010, gave him a two-year jail term in absentia and issued an arrest warrant.

In November 2009, a Moscow court satisfied another BTA claim on Stepanov. The ruling is being dealt with by an appeal court, BTA said.

BTA Bank, Kazakhstan’s second-largest bank, may complete a protracted debt restructuring as early as May.The state plans to sell its stakes in BTA in 2012 or 2013.

By Ivan Anderzhanov

Russia’s Aton Capital is to open offices in London and Almaty a year after the investment banking business was relaunched.

The Moscow-based equity brokerage is looking to expand further in the UK and Kazakhstan having already hired a 50-strong Moscow team , according to a report in Vedomosti.

Evgeny Yuriev, the president and founder of Aton Capital, sold the brokerage business in July 2007 for $424m.

The Aton brand was subsequently dropped in February last year and the Russian business was renamed UniCredit Securities.

Much to the dismay of UniCredit, Yuriev opted to re-enter the investment banking market having retaining the Aton Line discount brokerage and Aton asset management businesses.

Aton hired a 50-strong team  last year of analysts, traders and sales personnel.

Several staff were poached by Yuriev from UniCreidit. Other recruits included senior analyst Ivan Nikolaev and Svetlana Kovalskaya, who had both been employed at Renaissance Capital. Peter Westin, a one-time head of research at Aton, recently rejoined the firm to lead its research efforts after a stint at JP Morgan and MDM Bank.

Vedomosti said Aton intends to expand further into corporate finance and to start trading in bonds and derivatives by the end of the year.

A public listing of the business has also been mooted for five years time.

By Rustam Botashev, Equity Analyst at UniCredit Securities

Kazakhstan’s Financial Supervisory Agency (FSA) published preliminary banking statistics for 2009.

Our view: The banking sector’s losses for the year totalled KZT 2,837bn ($19.1bn), or KZT 127bn ($0.9bn) excluding the two defaulted banks (BTA Bank and Alliance Bank).

Retail loans declined by 4.8% yoy and corporate loans rose by 7.3% yoy, resulting in total loan growth of 4.3% yoy. Total deposits rose by 13.5% yoy (but declined by 9.4% when taking into account the 23% tenge devaluation) and shrank in December by 1.1% mom. As a result, the system’s loan-to-deposit ratio decreased from 1.35X as of end-2008 to 1.24X as of end 2009

Aggregate NPLs reached 36.5% (or 17.9% excluding the defaulted banks) compared to 8.1% as of end-2008. The volume of non-performing loans in absolute terms continued to decline for a second month in a row (down 1.1% mom), far from the skyrocketing growth of 93% mom in May 2009. However, given the smaller loan portfolio, the NPL to total loans ratio grew by 0.3pp mom to 36.5%. Bad loan reserves went up by 254.5% yoy and still fully cover NPLs (coverage of 103.3%).

FSA data also showed that Halyk Bank’s 2009 net income exceeded KZT 2,591m ($17.5m) under local accounting standards. Halyk is now Kazakhstan’s market leader in terms of earnings, and second in terms of assets.

The Kazakhstani banking sector was hit hard in 2009 by a sharp devaluation of the tenge and an economic slowdown that resulted in the default of BTA Bank and Alliance Bank, and asset quality deterioration across the whole sector.

Nevertheless at the end of 2009, Kazakhstan’s banking system started showing the first signs of recovery, such as declining NPL growth. We believe that the worst is over for the industry and rate both Kazakhstani banks, Halyk Bank and Kazkommertsbank, Buy.

By Marcus Williams

Kazakhstan’s Eurasian Bank has bought a Troika Dialog subsidiary bank in Almaty for an undisclosed amount in a bid to expand its business abroad.

Eurasian is controlled by the principal owners of London-listed Kazakh mining company Eurasian Natural Resources Corp.

Troika, which sold a third stake to South Africa’s Standard Bank in March, bought the subsidiary bank from VTB in 2007 as a platform for providing banking services in order to diversify its business model.

A report in Vedomosti last week suggested Troika will pay 3o% less in bonuses for 2009 though it expects earnings to rise.

By Jason Corcoran

Kazyna Capital Management, the private equity arm of Kazakhstan’s sovereign wealth fund, is combining with the European Bank for Reconstruction and Development (EBRD) to set up a $300m vehicle to invest in distressed companies.

The fund will focus on financing of companies experiencing problems with repaying their debt. Its main task will be debt restructuring and financial support.

The fund will not limit its activities only within Kazakhstan but will actively look at investment opportunities abroad. It also plans to invest in companies from across almost all sectors of the economy.

Speaking at a forum in Almaty, the chairman of Kazyna Alpamys Abay, said  “We have a lot of stable companies under the yoke of debt that are experiencing problems. With the creation of fund, there is an opportunity to change their debt issues.”

Abay said Kazyna also plans to raise funds with the World Bank and Asian Development Bank.

The company said it will will hire up to 15 specialists to run the fund.

Kazyna Capital Management,was launched in May 2007  to develop the non-resource sectors of the Kazakh economy and bring in foreign investment, as well as to bu international assets. It has previously co-invested with the EBRD through the Kazakhstan Growth Fund set up last year.

By Jason Corcoran

Mehmnet Dalman, the former head of investment banking at Germany’s Commerzbank, has been appointed to head a mergers and acquisitions committee at Kazakh miner Eurasian Natural Resources Company.

Dalman, a former hedge fund banker and reputed deal maker, had joined the board of London-listed ENRC in May last year as a non-executive director.

Analsyts said his new appointment is a strong signal  that the FTSE 100 company is set to continue buying global mining assets after its acquisition of the Central African Mining & Exploration Company (Camec) for £584m last month.

Dalman, who left Commerzbank in 2004, is also vice-chairman of Toscafund, a UK-based hedge fund.

ENRC, which was formed from a collection of privatised Kazakh mining assets, has $2bn cash pile for acquisitions.

The group last year launched an abortive takeover of rival miner Kazakhmys.

By Ivan Anderzhanov in Moscow

Kazakhastan energy producer KazMunaiGaz is to acquire a 33% stake in PetroKazakhstan from its parent company KazMunaiGaz for $100.5mn and the assumption of $831mn of debt.

The board of of KMG  received an opinion from Credit Suisse that the consideration to be paid for  a stake in PetroKazakhstan is fair  from the financial point of view.

The remaining stake belongs to Chinese oil producer CNPC, which acquired the company in 2005 for more than $4bn.

A note from UniCredit Securities said the deal values the company at $5.1/bn, in line with the valuations of other Kazakhstani oil producers. “We therefore see the valuation as reasonable and believe the deal supports our positive stance towards KazMunaiGaz E&P,” it said.

By Ivan Anderzhanov in Moscow

The beleaguered bank BTA anounced today it had signed a memorandum of understanding (MOU) with its creditors’ steering committee, in a major step towards talks to restructure the Kazakh state bank’s $10bn in debt.

The MOU was developed following meetings that took place in London between BTA’s adviser and the steering committee from September 14 – 17.

The MOU is non-binding on any financial creditor and the restructuring will be subject to certain conditions precedent,” according to a statement by BTA.

BTA has outlined four restructuring options to its creditors, including a worse-than-expected 82.25% haircut for a cash buyback. Once a final restructuring plan has been agreed with shareholders, the bank sid a decision would be made on BTA’s possible sale to Russian state lender Sberbank.