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Astana, Kazakhstan • 06 December, 2022 | 11:28

Fitch Affirms Kazakhstan at 'BBB' with Stable Outlook

Strong fiscal and external balances are highlighted as key factors

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The Fitch credit rating agency affirmed Kazakhstan’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘BBB’ with a stable outlook on December 2, 2022, QazMonitor reports citing the ministry of the national economy with a reference to Fitch.

The key factors supporting Kazakhstan's rating are strong fiscal and external balances, which have shown resilience to external shocks. The country has substantial fiscal buffers to maintain its net external creditor status.

Kazakhstan is assigned a high sovereign position on net foreign assets, which at the end of 2021 amounted to 37% of GDP.

The Fitch report highlights the stable and sufficient capitalization of the Kazakh banking sector with an NPL ratio of 4.6%, as of Q3 2022.

According to analysts, high-interest rates on local currency deposits and a number of other measures have prevented the withdrawal of funds from deposits.

ESG considerations have also become an important measurement in the rating. In the creditor rights section, Kazakhstan’s willingness to service and repay debt received a positive review.

“As Kazakhstan has a record of 20+ years without a restructuring of public debt and captured in our SRM variable, this has a positive impact on the credit profile,” the reports said.

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