Weekly National Bank of Kazakhstan balance on the notes - plus 3,309.7 million tenges
The National Bank has finished seventh calendar week (February 07 - 13) in the State Securities primary market with the following results. At actual volume of redemption of 187.6 million tenges (������-3 #247) the emitter attracted 3,497.3 million tenges(460.8 million tenges + $21.7 million at the official rate).
The week balance of the emitter under the notes program remains negative and is evaluated by 3,309.7 million tenges.
Weekly volume of Non-state Securities transactions on kase - $92.300
Within seventh week of 2000 on the Kazakhstan stock exchange (KASE) the activity of the non-state securities market has remarkably decreased. During this time 3 transactions totalling $92.3 were made. In comparison with the previous period (7 transactions, $3.419 mln) the number of trade has decreased 37.1 time.
The total volume of the transactions has made 92,000 compared to 102,299 shares of the previous month.
The deals were made in two tools:
� common registered shares of JSC ShNOS (SYRG, official list, category �A�) - 2 transactions or 99.7% of the trade sector�s volume;
� common shares of JSC GEOTEKS (GEOT, sector �Non-listing securities�, first level of admission) - the direct transaction, made in the KASE quoting system.
Capitalization of Non-state Securities market of Kazakhstan on February 11 - $2,228.8 million
On February 11 capitalization of the exchange market of Non-state Securities of Kazakhstan (A + B + N without the State Block of Shares) has amounted to $2,228.8 million.
For one weeks capitalization has grown by $16,220 mostly due to some increase of the JSC ShNOS common registered securities prices.
The deals can be made on KASE today in 90 tools of the 68 companies and 4 state blocks of shares.
weekly volume of deals in foreign currencies at KASE � equivalent of $31,035 mln
In U.S. dollars within the seventh calendar week of the year 2000 (February 7 - 13) at Kazakhstan Stock Exchange (KASE) 440 transactions totaling $31.035 mln were made, including 429 deals ($28.735 mln) on TOD terms, 9 deals ($1.300 mln) on TOM terms and 2 deals ($1.000 mln) on SPOT terms. Average volume of the main (day) session in U.S. dollars equaled $5.247 mln.
This week tenge devaluation rate against the dollar, calculated at weighted average rate of the Exchange (only the morning session is taken into account), is estimated by a trend of 16.6% APR.
In the previous week 216 deals totaling $19.835 mln were made, including 214 deals ($18.835 mln) on TOD terms and 2 deals ($1.000 mln) on SPOT terms. During this period weighted average exchange rate of the dollar was decreasing at an average of 0.4% APR (only the morning session is taken into account).
ALMATY, Feb 14 (THE GLOBE)
�There is no alternative to the Halykh Bank of Kazakhstan in the field of grants, scholarships, and other payments,� the HB Board Karim Masimov said to journalists on Monday. February 14. He announced that the Board of Directors had a new composition. They had to elect the new Board of Directors, as shareholders changed due to the sale of a part of the state stock-packer of the JSC Halykh Bank of Kazakhstan (THE GLOBE #97 (415)).
Masimov said that the further privatization had been postponed by 2 to 3 years. During this period the national mail-saving system is supposed to function effectively.
The JSC Kazpochta is one of strategic partners of the HB. They agreed with the Japanese Ministry of Post and Telecommunication for technical and consulting aid to establish the system of mail savings in Kazakhstan.
Kazpochta will soon become a subagent of the Halykh Bank. It will give pensions in rural settlements, where the HB has no subsidiaries. Masimov said that the bank was going to delegate its subsidiaries and affiliated companies with a number of unusual functions. This will significantly increase the efficacy of the HB�s work.
There were structural reforms in the Halykh Bank. To realize the renewed strategy, departments directly working with clients (including the department working with corporations, the retail business department and the department on small and middle-sized business) will play an especial role.
ALMATY, Feb 14 (IRBIS)
The period from February 7 through 11 was characterized by an increased activity of the participants and by the formation of a new trend of the U.S. dollar exchange rate towards the tenge. Gradual firming of the national currency turned into a growth of USD. Other foreign currencies practically did interest the traders. Not a single deal was made neither in Deutsche mark not in euro at Kazakhstan stock exchange (KASE).
Firming of the dollar at KASE began as far back as on Thursday, February 3, when a few banks of the second tier (BST) made an attempt to raise the exchange rate of USD. But the main impulse was received by the market on Friday, February 4. By this day some of the dealers, who represent the major banks, were able to determine by the general mood of the market and the behaviors of the their colleagues that the dollar was a little oversold, the market was somewhat �short�, and that the exchange rate of the dollar had a support level which does not let it to fall even further. Relatively high inflation in January allowed for some growth in the exchange rate of USD. Under this conditions raising the exchange rate of the dollar could be successful. This time a stable and absolutely balanced market of the American currency could be disturbed for a short time. Precise calculations proved to be good. Traders, who were in short positions for long, began to close them and gradually buy dollars at growing prices.
Monday (February 7) showed the market was able to conceive the new impulse. Results of the trade show that dealers comprehend a speculative nature of the disturbance, and therefore, they are not in hurry to increase the demand for dollars. In current situation there are no grounds for a serious firming of the dollar. However, the trend was conceived, because it �started� on time, and the market is turning around now. Dealers weight each next step and they are very cautious. It seems as if nobody is waiting for a significant growth in the exchange rate of the dollar, since the market is still balanced. But gradual rise in the price of USD is more likely to be supported by the participants for some time.
However, on Wednesday the general mood of the market changed some. Under the limited tenge liquidity, caused mainly by the necessity of transferring the funds for SS purchased during the week, demand for USD fell, but supply of the American currency fell even more. The forecasts of the dealers regarding inactivity of the exporters on currency market in the next ten days of February was becoming more apparent. Devaluation expectations has grown. It caused the growth in the exchange rate of USD to accelerate at KASE on February 9 and the market to reorient itself for further firming of the American currency.
In such situation on Wednesday the National Bank offered the investors their favorite instrument � short term notes which certainly have high demand. But if in last three weeks the emitter was using this demand mainly to decrease the yield of the notes by refraining itself to small borrowing amounts, now, it preferred to clean up correspondent accounts of the banks. Yields of the notes were left at previous levels, but the borrowing amount reached KZT1,633.0 mln. Since the National Bank had to repay the notes for a total of KZT3,502.4 mln the clean up was done on time. Growth rate of the dollar sharply decreased at KASE on Thursday, and afternoon quotations noticeably �subsided� under the temporary deficit of tenge on the market. On Friday weighted average rate of the dollar at the Exchange decreased as well, and the results of the evening trades made an impression of complete normalization of the market and return to an equilibrium.
The week resulted in 44 point firming of the dollar against tenge or 0.32% (at weighted average rate of the main session), which corresponds to an average of 16.55% APR.
Previous week has left ambiguous impressions. As the dealers said �the market is looking upward�. There are devaluation expectations on the market that were stimulated by an increase in official rate of the dollar up to 139.65 from 139.45 tenge.
On the other hand, there is no deficit of the dollar, and exchange rate fluctuations are within working conditions where it is risky to open long positions (to buy dollars with the hope for increase in their price) without a careful judgement. There is also a position of the country�s head bank, which is not interested in fast devaluation caused by speculative games of the BST. Repayment of notes on February 10 and 11 were practically neutralized by Wednesday placement of notes, Thursday placement of MEKAVM-12 and Friday placement of MEKAVM-9. And actual USD quotations of the Exchange on Thursday evening indicate restricted attitudes of the dealers towards current events.
Thus, based on an analysis of current situation it is hard to presume essential changes in the market conjuncture for the dollar in the week that just began. It is quite possible that some banks will try to raise the exchange rate of the dollar further, but this initiative is unlikely to be supported by the most of the traders due to high risk of opening long positions in current situation and sufficiency of dollars on the market. Therefore, even if the dollar exchange rate will grow, rate at which the American currency might firm will be small.
It should be said also that activation of the market and its transparency was caused by a temporary cancellation of commission fees at KASE trades in foreign currencies. It caused volumes of the trades to increase significantly (please, see tables and graphs), and the banks to work quite actively on the day and evening sessions of the Exchange as well. Making deals with TOM and SPOT terms made it easy to make short term forecasts and prevented the creation of emotions induced by unjustified forecasts.
THE GLOBE editorial staff and the law firm LEX ANALITIC present the informational section � Law Bulletin. Below are the brief analytical review of some Kazakhstani laws, comments on the laws and court practice, development of the law system by professional lawyers.
1. International Law:
On December 30, 1999 Kazakhstan ratified a number of conventions on the International Labor Law: the 1976 Convention on tripartite consultations (international labor standards); the 1948 Convention on freedom of associations and protection of the right for organization; and the 1971 Convention on workers� representatives. According to the Kazakhstani �Law On Labor in the Republic of Kazakhstan� dated 10.12.99, similar international initiatives are the next step towards the �civilized market� system of the national labor law.
On December 30, 1999 Kazakhstan ratified the Agreement on the order of mutual fulfillment of decisions by arbitrages and economic courts in the CIS countries; the Agreement on legal status of citizens of a state, who constantly live in another state; and the Convention on Protection of investors� rights.
On December 30, 1999 Kazakhstan joined the Convention on citizenship of a married woman and the Convention on alimony collection abroad.
2. National legislation:
On December 2, 1999 the Law of the Republic of Kazakhstan on physical culture and sport was approved.
The RK Law dated (10.12.99) on changes and supplementation to the Law on licensing, stipulates licensing of the tourist activity.
The RK Law (15.12.99) supplemented the Law on joint-stock companies. The essence of changes is that the only JSC shareholder should not hold joint meetings of shareholders; an owner (not obligatorily � an appropriator) of all voting stocks has the right to take independent decisions on issues that are in competence of the joint meeting of shareholders, etc.
The governmental Decree (hereinafter referred to as GD) on additional measures to settle the problem of debts to foreign organizations, was issued on December 28, 1999. On December 24, 1999 the GD on some issues of the oil and gas industry, and on January 6, 2000 the GD on some issues of bowels exploitation were issued.
3. Became invalid:
The Decree by the Cabinet of Ministers of RK (hereinafter referred to as CM RK) dated 08.09.1995 on approval of the Provision on Interdepartmental Telecommunication Commission subordinate to the CM RK.
4. Official interpretation and juridical practice:
On December 20, 1999 the Plenum of the Supreme Court of the Republic of Kazakhstan issued a Decree on some issues of the tax legislation used by courts. The Decree stipulated: a) impossibility to interpret widely the tax legislation with the help of law documents, explanations, instructions, etc., that are not of a normative character; b) procedural peculiarities of disputing acts by the tax bodies, etc.
5. Perspective legislation (bills, prognoses, etc.):
The Agreement on coordinated transport tariff policy has been submitted to the President for consideration. Taking into consideration statement by the Minister of State Revenues (MSR) Z. Kakimzhanov at the MSR broadened meeting held on January 17, 2000, we may expect transport tariffs to grow.
The GD dated 11.11.99 stipulates the possibility of further establishment of �specialized interregional arbitrages� to consider disputes between juridical persons and individuals, including disputes �with foreign investors.�
Read the next issue of Law Bulletin in the next issue of THE GLOBE.
You may get the detailed information and qualified services on any legal issues in the Almaty office of the law firm LEX ANALITIC. Tel./fax: 63-17-11, tel.: 63-72-26.
Hoping for the cooperation,
N.A. Slovyak and D.A. Bratus, LEX ANALITIC Managers
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