Kazkommertsbank Syndicated Loan

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The proposed project consists of an A/B syndicated loan to Kazkommertsbank in an aggregate amount of up to USD 300 million for the development of mortgage lending in Kazakhstan and the diversification of the Kazakh economy by funding enterprises that are not engaged in the construction and the oil and gas sectors. The transition impact of the project is expected to be achieved in the following main areas: Lengthening of syndicated loan maturity. The project will be aimed at extending the maturity of the syndicated B Loan from commercial banks for up to 5 years (while the EBRD A Loan will be for up to 7 years, while diversifying the sources of commercial funding. To date the longest syndicated loan attracted for any Kazakh bank has not exceeded 3 years. Financial intermediation and dedicated use of proceeds. The use of proceeds will be for (i) financing of private non-construction and non-oil sector corporate companies, which will support the diversification of the real sector of the Kazakh economy; and (ii) residential mortgages for private individuals, which will comply with EBRD’s Minimum Standards for Mortgage Loans. Kazkommertsbank (“KKB”) is the longest standing EBRD client in Kazakhstan. KKB is the largest bank in Kazakhstan with total assets of USD 19.2 billion and total BIS Tier 1+2 capital of USD 2.6 billion (IFRS) at year-end 2006. KKB has long-term ratings of BB+ from Standard & Poor’s, Ba1 from Moody’s and BB+ from Fitch. Up to USD 100 million. Up to USD 300 million. KKB is already implementing the Bank’s Environmental Procedures for Local Banks under the equity operation and regularly reports on environment, health and safety matters to the Bank. The Bank’s environmental consultants provided additional environmental due diligence training for Kazakh partner FIs, including KKB, in 2006. In relation to the new project, KKB will be required to continue to implement the Bank’s Environmental Procedures for Local Banks and Environmental Procedures for Residential Mortgage Loans for the specific residential mortgage operation as well as to continue to submit annual environmental reports to the Bank. None. Alfiya Aliyeva, Head of Structured Finance Kazkommertsbank Tel: +7 327 2 585 427 Fax: +7 327 2 585 237 E-mail: aaliyeva@kkb.kz