Moody's Affirms Halyk Bank at Baa1;Outlook Stable

Moody's affirms Halyk Bank's Baa1 rating, citing strong capital and liquidity metrics.

What the company is saying

JSC Halyk Bank is highlighting Moody's affirmation of its long-term local and foreign currency deposit ratings at Baa1, with a stable outlook. The announcement emphasizes the bank's strong capital position, profitability, and liquidity, referencing a TCE/RWA ratio of 18.5% and a liquidity buffer of 27% of total assets as of June 2026. Halyk underscores its return on average assets exceeding 4% since 2024 and its status as Kazakhstan's largest bank, holding 28.6% of total banking system assets as of July 2026. The company acknowledges an increase in problem loans to 8.6% of gross loans but frames this within Moody's expectation that asset quality will stabilize at 8%-9% over the next 12-18 months. The narrative is confident, focusing on systemic importance, strong franchise, and government support, while forward-looking statements are limited to Moody's projections for continued strength in capital, profitability, and liquidity.

What the data suggests

The disclosed figures show Halyk Bank with total assets of KZT 22,036bn as of June 30, 2026, and a dominant 28.6% market share in Kazakhstan's banking sector. The TCE/RWA ratio of 18.5% and a liquidity buffer at 27% of total assets indicate robust capital and liquidity positions. Return on average assets has exceeded 4% since 2024, supporting the narrative of high profitability. Problem loans have risen to 8.6% of gross loans, with Moody's projecting stabilization at 8%-9% in the next 12-18 months. The bank operates 530 branches and service outlets, with operations in Kazakhstan, Georgia, and Uzbekistan. Moody's assessment of a very high probability of government support underpins the Baa1 rating. The data is comprehensive for a point-in-time snapshot but lacks period-over-period comparatives, limiting insight into financial trajectory or trend.

Analysis

The announcement is a factual disclosure of Moody's affirmation of Halyk Bank's ratings, supported by specific, current financial and operational metrics (TCE/RWA ratio, liquidity buffer, ROAA, problem loans, total assets, market share). The tone is positive, but the language is proportionate to the evidence: most claims are realised facts, with only a minority of forward-looking statements regarding expectations for the next 12-18 months. There is no exaggerated or promotional language, and no large capital outlay or long-dated, uncertain returns are discussed. The only slightly subjective claim is the description of capital, profitability, and liquidity as 'strong' or 'good,' but these are supported by disclosed ratios. The forward-looking statements are standard for a rating affirmation and are not aspirational or hyped. The gap between narrative and evidence is minimal.

Risk flags

• ●Problem loans have increased to 8.6% of gross loans as of June 2026, which may pressure future asset quality if economic conditions deteriorate or underwriting standards weaken. Although Moody's expects stabilization, any further rise could impact profitability and capital ratios.
• ●The bank's strong market position and systemic importance mean it is highly exposed to macroeconomic and regulatory risks in Kazakhstan. Any adverse changes in the country's economic growth or policy environment could affect Halyk's risk profile and government support assumptions.
• ●The absence of period-over-period financial data restricts visibility into whether capital, liquidity, and profitability metrics are improving or deteriorating. This limits an investor's ability to assess momentum or emerging negative trends.
• ●Moody's stable outlook and positive projections rely on continued economic growth and prudent underwriting. If these conditions do not hold, the projected stabilization of asset quality may not materialize, increasing credit risk.

Bottom line

Moody's affirmation of Halyk Bank's Baa1 rating, with a stable outlook, is grounded in strong disclosed capital and liquidity ratios, a high return on assets, and a leading market share in Kazakhstan. The rise in problem loans to 8.6% is a concern, but Moody's expects asset quality to stabilize near current levels over the next year. The bank's dominant position and government support underpin its credit profile, but exposure to Kazakhstan's economic and regulatory environment remains a key risk. The lack of historical comparatives means investors cannot gauge whether these metrics are improving or worsening. The most actionable takeaway is that Halyk remains a systemically important, well-capitalized bank with near-term stability, but monitoring asset quality and macroeconomic developments will be critical for future risk assessment.

Announcement summary

(LSE:37QB) JSC Halyk Bank announced that Moody's Ratings has affirmed the Bank's long-term local and foreign currency deposit ratings at Baa1, with a stable outlook. Moody's also affirmed the Bank's long-term Counterparty Risk Assessment at Baa1(cr), long-term local and foreign currency Counterparty Risk Ratings at Baa1, short-term local and foreign currency deposit ratings and CRRs at Prime-2, short-term CR Assessment at Prime-2(cr), and Baseline Credit Assessment (BCA) and Adjusted BCA at ba1. The affirmation reflects the Bank's strong capital and profitability and good liquidity. Halyk's TCE/RWA ratio stood at 18.5% as of June 2026, with a liquidity buffer equal to 27% of total assets. The Bank's return on average assets has exceeded 4% since 2024. Problem loans increased to 8.6% of gross loans as of June 2026. As of 1 July 2026, Halyk was Kazakhstan's largest bank, with a 28.6% share of total banking system assets. As of 30 June 2026, Halyk Bank had total assets amounting to KZT 22,036bn. The Bank operates in Kazakhstan, Georgia, and Uzbekistan, with 530 branches and service outlets nationwide.

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