The new chief of Kazakhstan’s central bank dodged a debt claim in 2014 thanks to a legal system that’s failed to protect lenders from rampant defaults and repeated crises, Bloomberg News reported. In 2014, Yerbolat Dossayev and three business partners were given a reprieve on repaying 1.9 billion tenge, then worth $13 million, that they’d personally guaranteed to the central Asian country’s biggest bank at the time. It’s not clear whether the debt was ever repaid.
The Kazakh authorities are urgently looking for a bank to take over no. 2 lender Tsesnabank as they believe it needs new financing to prevent a collapse, three sources familiar with the discussions told Reuters. Officials from the government and central bank have approached at least three other Kazakh banks and hope to tie up a deal in February, the sources said. They are offering financial incentives for any bank prepared to take it over, Reuters reported.