Page 11 - Kazakh Outlook 2025

“Sector-average loan impairment charges increased to 2% of average gross loans in 9M24 (annualised), from below 1% in 2021. Unsecured consumer lending is the source of most of the asset quality deterioration,” Fitch said. “We view this as a high-risk segment in Kazakhstan due to rapid loan growth in 2021-2022, combined with high interest rates and short tenors, which increase the repayment burden on borrowers.”
The National Bank of Kazakhstan and the Agency for Regulation and Development of the Financial Market introduced new regulatory measures in August with the aim of mitigating risks in retail lending, the ratings agency noted. These include reduced caps on effective interest rates for retail loans, limits on the size of unsecured loans, and maximum debt-to-income ratios for borrowers. These measures are expected to curb retail loan growth and constrain short-term performance metrics along with tempering banks' appetite for high-risk consumer lending.
“Potential taxation changes could also negatively affect banks’ performance, but we expect the impact to be limited. Banks’ income on NBRK discount notes and client operations will become subject to 20% corporate tax under upcoming changes to Kazakhstan’s tax code, according to government officials. However, we believe Kazakh banks would be able to pass the increased tax costs on to their customers through higher fees and commissions. Beyond this, we do not expect other substantial tax changes for banks until after 2025, in our baseline scenario,” Fitch concluded.
4.3 Industry
Oil & Gas
Kazakhstan’s industrial output is mainly driven by oil production and mining.
Kazakh Energy Minister Almasadam Satkaliyev announced in December a reduction in the 2024 oil production target to 87.8mn tonnes, down from the previously planned 90.3mn tonnes. This adjustment accounts for major maintenance at key fields like Tengiz and Kashagan, as well as unplanned
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