Standard & Poor’s Ratings Services said that it raised its long- and short-term foreign currency counterparty credit ratings on Samruk-Kazyna to ‘BBB+/A-2’, in line with the raising of the sovereign foreign currency ratings. At the same time, we affirmed the long- and short-term local currency counterparty credit ratings at ‘BBB+/A-2’, and the Kazakhstan national scale rating at ‘kzAAA’. The outlook is stable.
The ratings on Samruk-Kazyna are equalized with those on the Republic of Kazakhstan (foreign currency BBB+/Stable/A-2; local currency BBB+/Stable/A-2; Kazakhstan national scale kzAAA). This reflects our view of an “almost certain” likelihood of the government providing timely extraordinary support sufficient to service all debt, should the need arise in any severe downside scenario. Our assessment of the likelihood of extraordinary support is based on our view of Samruk-Kazyna’s critical role as the main operator for the government’s off-budget financial and economic activities and the company’s “integral” link with the government.
Samruk-Kazyna is a 100% state-owned holding company that consolidates over 400 of Kazakhstan’s state-owned enterprises, including vertically integrated oil company NC KazMunaiGas, railway operator Kazazkhstan Temir Zholy, electricity company KEGOC, telecom operator Kazakhtelecom, mining company Kazatomprom, government-owned investment funds, stakes in several key local banks, and a number of other entities in various sectors. These broad holdings underpin our view of the entity’s strategic importance. Samruk-Kazyna’s oversight role empowers it to monitor and approve large borrowings and significant transactions for every subsidiary on behalf of the government. The investments and financing decisions of the holding company reflect government policy and the government’s direct input via Samruk-Kazyna’s board of directors, which the prime minister chairs.