BAKU, Azerbaijan, June 3. Development Bank of Kazakhstan (DBK) no longer will be providing funding to projects within the framework of the public-private partnerships, Trend reports citing the DBK.
The decision was made by the sole shareholder of DBK – the Baiterek National Managing Holding. At the same time Baiterek made a number of decisions to reform the activities of the DBK.
According to the amendments, when applying for funding, a potential applicant grants DBK the right to disclose information about all owners of a legal entity, including ultimate beneficiaries. Until now, DBK had the right to disclose information on the main terms of financing and general information on the project.
In addition, the changes have been made to the list of the sectors whose financing by the Bank is prohibited. From now on, financing will not be provided for the implementation of projects within the framework of the public-private partnerships, and also if fifty or more percent of the voting shares (participatory interests) of a legal entity directly or indirectly belong to the Republic of Kazakhstan due to their ability to attract financing directly.
An exception can only be projects with the participation of other creditors, that is, with co-financing or syndicated financing from international financial institutions. Also, these projects will have to comply with the principles of environmental, social and corporate governance (ESG).
Another change is that now the state property will not be accepted as collateral for the obligations of the private companies, and when selecting projects, applicants will be required to provide an action plan to increase the transparency of the procurement procedures within their projects.
Also, Baiterek approved amendments to the Charter of the Industrial Development Fund, a subsidiary of the Development Bank, due to which the functions of the Fund were significantly expanded. It should be noted, earlier the Fund carried out mainly leasing operations.
Now its goal is to provide the financial support and stimulation of manufacturing enterprises, as well as assistance in attracting foreign and domestic investment in the economy of Kazakhstan.
Thus, the Fund will begin to offer a wider range of financial instruments to Kazakh enterprises, including direct lending.
