BTA Tumbles Down Rating Ladder

Slammed by Moody’s Investors Service’s sharp downgrade in the corporate rating, the DPR bonds of Kazakhstan’s BTA Bank have likewise fallen hard, again.

The agency Monday cut the stand-alone rating of four deals maturing in 2015 to ‘Ca’ from ‘B1’ following the downgrade of a slew of ratings on the originator.

Concerns are swirling over accelerated payments on BTA’s DPR program, which was supposed to kick in after Moody’s last downgrade tripped early amortization triggers. A government fund that now owns BTA has said that it might withdraw support if investors insist on acceleration (see ASR, April 2009).

The most recent downgrade doesn’t trip additional triggers or further accelerate payments.
The downgrades on the originator’s rating “reflect the increasing likelihood of default and debt restructuring by BTA Bank and Temirbank stemming from the ongoing deterioration of these banks’ financial strengths and reduced probability of government support to honor their foreign liabilities.”