Republic of Kazakhstan-based JSC Alliance Bank filed for Chapter 15 protection with the U.S. Bankruptcy Court in the Southern District of New York, case number 14-13194. The Company, which operates as a universal financial institution in Kazakhstan, is represented by Scott Greissman and Richard A. Graham of White & Case. According to documents filed with the U.S. Bankruptcy Court, the Specialized Financial Court of Almaty City of the Republic of Kazakhstan granted the Company’s initial application for restructuring in September 2009, commencing the Bank’s first insolvency proceeding. In December 2009, the Bank’s financial creditors approved a definitive restructuring plan, and the Sovereign Wealth Fund of the Republic of Kazakhstan (Samruk-Kazyna) acquired 100% of the Bank’s common and preference shares shortly thereafter. The Company notes, “During 2012 and 2013, the financial condition of the Bank deteriorated once more, primarily as a result of a material increase in its non-performing loans (currently, more than 50% of the Bank’s loan portfolio is non-performing) and significant outflows of customer deposits (particularly since mid-2013 and continuing in 2014)…On January 30, 2014, the board of directors of the Bank decided to initiate restructuring proceedings in Kazakhstan and instructed the Bank’s management board to take the steps necessary to do so.” On February 25, 2014 the Bank applied for its second restructuring pursuant to the Banking Law, and the Kazakhstan Court granted that application on March 3, 2014. This restructuring is premised on the Bank’s consolidation with two other Kazakhstan banks controlled by Bulat Utemuratov: Temirbank and ForteBank. The primary purpose of the consolidation is to contribute Temirbank’s and ForteBank’s capital surplus to the restoration of the Bank’s regulatory capital. JSC Alliance Bank’s Chapter 15 petition indicates total assets greater than $1 billion.
About George Putnam
George Putnam, III the principle owner of New Generation Research, Inc., is a graduate of both Harvard Law School and Harvard Business School. He first became involved with distressed securities as a lawyer in the late 1970s. After seeing the inefficient niche that bankruptcies operated in, he founded New Generation Research, Inc. in 1986 with The Turnaround Letter and The Bankruptcy DataSource being the first offerings. Since then he has frequently been quoted in Barron’s, The Wall Street Journal, New York Times, USA Today and other financial publications for his thoughts on distressed and bankruptcy investing and research. In 1990, he was named investment advisor of the year by USA Today. In addition to his responsibilities at New Generation Research, Inc., Mr. Putnam also serves as a trustee for The Putnam Companies, a mutual fund group with over $100 billion in assets.