OREANDA-NEWS. January 31, 2011. Standard & Poor's Ratings Services said it revised its outlooks on Kazakhstan-based Kazkommertsbank (JSC) (KKB), JSC Nurbank, and JSC AsiaCredit Bank to stable from negative. At the same time, the long- and short-term counterparty credit ratings on the banks were affirmed. We also assigned our 'kzBB+' Kazakhstan national scale rating to Nurbank, reported the press-centre of Kazkommertsbank.

The rating affirmations affect:

The 'B/C' long- and short-term counterparty credit ratings on KKB and Nurbank; and

The 'B/B' long- and short-term counterparty credit ratings on AsiaCreditBank.

The outlook revisions reflect our view of the robust economic recovery in the Republic of Kazakhstan (foreign currency BBB/Stable/A-3; local currency BBB+/Stable/A-2; Kazakhstan national scale rating 'kzAAA'). We expect GDP growth to average 7% between 2011 and 2013, underpinned by structural net inflows from foreign direct investment and the prospect of a doubling of oil output by 2020 (see "Republic of Kazakhstan FC And LC Long-Term Ratings Raised By One Notch To ‘BBB’ And ‘BBB+’; Outlook Remains Stable," published on Dec. 23, 2010, on RatingsDirect).

The rating actions also reflect our opinion that the banking operating environment in Kazakhstan has stabilized following the restructuring in 2010 of three of the four defaulted banks. The pressure on Kazakh banks' asset quality, liquidity, and profitability has, in our view, eased, following a period of heightened risks over the past three years.

In the short to medium term, we expect ongoing improvements in asset quality because we believe that the deterioration bottomed out in 2010. We also expect to see the three banks maintain adequate liquidity to meet wholesale debt repayments and customer deposit withdrawals, especially from government-related entities, and adequate capitalization to mitigate the high-risk economic and banking environment in Kazakhstan. In January 2011, we assigned a preliminary Banking Industry Country Risk Assessment (BICRA) score.

of 9 to Kazakhstan's banking industry (see "Preliminary Banking Industry Country Risk Assessments In 23 Countries," published on Jan. 6, 2011). A BICRA signals our view of the relative riskiness of a country's banking industry on a scale of 1 to 10, ranging from the lowest-risk banking industries (group 1) to the highest-risk banking industries (group 10).

The ratings on the three banks are based on our assessment of their stand-alone credit profiles and we do not currently apply any uplift for extraordinary parental or government support to these banks.