World Bank2012-03-192012-03-192009-06https://hdl.handle.net/10986/3058The Kazakhstan financial sector remains dominated by domestic commercial banks. The banking sector is largely domestically owned, private, and relatively concentrated, with the largest five banks accounting for 78 percent of total banking assets. The share of foreign banks has increased to about 15 percent of total banking assets after some recent acquisitions. The stress testing included single factor sensibility and scenario analysis and focused on the potential impacts of the two main risks being faced by the banking system, liquidity and credit risks. The exercise looked into the potential impact of: (i) the ongoing liquidity crunch and worsening external funding conditions; and (ii) asset and collateral quality deterioration, particularly for construction, real estate, and consumer lending. Some progress has been achieved in strengthening the prudential framework and improving bank governance. However, there is a need to move towards risk-based supervision with more attention to banks' use of risk management systems and internal controls, strengthen the capacity to implement effective consolidated and cross-border supervision, build up stress testing capacity, improve the approach to asset classification and valuation, and develop liquidity risk monitoring capacity. The financial sector assessment (FSA) has taken a more proactive approach in dealing with banks under stress but staff turnover and capacity building issues hinder efforts. The 2004 mission recommendation to increase focus on liquidity risk of individual institutions has not been implemented effectively and, as a result, reliance on wholesale funding continues to pose risks.CC BY 3.0 IGOACCOUNTABILITYACCOUNTINGAFFILIATED COMPANIESAFFILIATESASSET CLASSIFICATIONASSET MANAGEMENTASSET QUALITYAUTONOMYBALANCE SHEETBANK ACCOUNTSBANK ASSETSBANK BORROWINGSBANK CREDITBANK DEPOSITSBANK INTEREST RATESBANK LIQUIDATIONBANK LIQUIDITYBANK PROFITABILITYBANK SUPERVISIONBANKING ASSETSBANKING CRISISBANKING DISTRESSBANKING LAWBANKING SECTORBANKING SYSTEMBANKRUPTCYBENCHMARK YIELDBENCHMARK YIELD CURVEBORROWERBUDGET SURPLUSCAPACITY BUILDINGCAPITAL ADEQUACYCAPITAL ADEQUACY RATIOSCAPITAL MARKETCAPITAL MARKET DEVELOPMENTCAPITAL MARKETSCAPITAL REQUIREMENTSCDSCENTRAL BANKCENTRAL BANK NOTESCLASSIFIED LOANSCOLLATERALCOMMERCIAL BANKSCOMMERCIAL LOANSCOMMODITY PRICESCONNECTED LENDINGCONSOLIDATED SUPERVISIONCONSUMER CREDITCONSUMER LOANSCONTINGENCY PLANNINGCORPORATE BONDSCORPORATE GOVERNANCECREDIT GROWTHCREDIT LOSSESCREDIT MARKETSCREDIT QUALITYCREDIT RATINGSCREDIT RISKCREDIT RISKSCURRENT ACCOUNT DEFICITDEBT BURDENDEBT INSTRUMENTSDEBT MARKETSDEBT RATIODEBT RECOVERYDEBT REPAYMENTSDEFAULTSDEPOSITDEPOSIT INSURANCEDEPOSITORDEPOSITORSDERIVATIVEDOMESTIC CREDITDOMESTIC FINANCIAL MARKETDOMESTIC LIQUIDITYDOMESTIC MARKETENFORCEMENT SYSTEMEXCESS LIQUIDITYEXCHANGE RATEEXTERNAL BORROWINGEXTERNAL FUNDINGFINANCIAL DEVELOPMENTSFINANCIAL INSTITUTIONSFINANCIAL MARKETFINANCIAL MARKETSFINANCIAL RATIOSFINANCIAL RISKSFINANCIAL STABILITYFINANCIAL STATEMENTSFINANCIAL SYSTEMFISCAL DISCIPLINEFOREIGN BANKSFOREIGN CAPITALFOREIGN CURRENCYFOREIGN CURRENCY LOANSFOREIGN DEBTFOREIGN EXCHANGEFOREIGN EXCHANGE EXPOSUREFOREIGN EXCHANGE MARKETFOREIGN FINANCINGFOREIGN MARKETSFORWARD RATESFUTURE CREDITGOVERNMENT BONDGOVERNMENT BOND MARKETGOVERNMENT BOND MARKET DEVELOPMENTGOVERNMENT DEBTGOVERNMENT DEBT SECURITIESGOVERNMENT FUNDINGGOVERNMENT INTERVENTIONGOVERNMENT SECURITIESGROSS SETTLEMENT SYSTEMHOLDINGSHOUSING FINANCEINDEBTEDNESSINFLATIONINFRASTRUCTURE BONDSINSTITUTIONAL INVESTORSINSURANCE COMPANIESINSURANCE PREMIUMINTEREST RATEINTERNAL CONTROLSINTERNATIONAL CREDITINTERNATIONAL MARKETSINTERNATIONAL RESERVESINTERNATIONAL STANDARDSINVESTMENT FUNDSINVESTMENT POLICIESINVESTMENT PROJECTSINVESTMENT RESTRICTIONSINVESTMENT VEHICLEISSUANCELEGAL FRAMEWORKLENDERLIQUIDATIONLIQUIDITYLIQUIDITY CRISISLIQUIDITY MANAGEMENTLIQUIDITY RATIOSLIQUIDITY RISKLIQUIDITY RISKSLOANLOAN PORTFOLIOLOAN PORTFOLIOSLOAN QUALITYLONG-TERM CAPITALLONG-TERM LOANSMANDATESMARKET CONFIDENCEMARKET DEVELOPMENTMARKET DEVELOPMENTSMARKET INFRASTRUCTUREMARKET LIQUIDITYMARKET TRADESMARKET TRANSACTIONSMATURITIESMATURITYMONETARY FUNDMONETARY POLICYMONEY MARKETMONEY MARKETSMONEY SUPPLYMORAL HAZARDMORTGAGEMORTGAGE MARKETNATIONAL BANKNATURAL RESOURCESNET INTEREST MARGINNON-PERFORMING LOANSOIL PRICESOPERATIONAL INDEPENDENCEOUTSTANDING DEBTOUTSTANDING DEBT SECURITIESOWNERSHIP STRUCTUREPAYMENT OBLIGATIONSPENSIONPENSION FUNDSPLEDGESPORTFOLIOPORTFOLIO QUALITYPORTFOLIOSPRIVATE PLACEMENTSPROFITABILITY ANALYSISPRUDENTIAL REQUIREMENTSPUBLIC ASSETSPUBLIC DEBTREAL ESTATE LENDINGRECAPITALIZATIONREGULATORY CAPACITYREGULATORY FRAMEWORKREPAYMENTREPAYMENT SCHEDULESRESERVERESERVE REQUIREMENTRESERVE REQUIREMENTSRESERVESRESIDENTIAL MORTGAGESRISK FACTORSRISK MANAGEMENTRISK MANAGEMENT SYSTEMSSAFETY NETSECONDARY MARKETSECONDARY TRADINGSETTLEMENTSHAREHOLDERSSOLVENCYSOVEREIGN RISKSTOCK EXCHANGESTOCK MARKETSTOCK MARKET CAPITALIZATIONSUBSIDIARIESSUPERVISORY AUTHORITYSWAPSTOTAL DEBTTURNOVERVALUATIONVALUATIONSYIELD CURVEYIELD SPREADSWorld Bank10.1596/3058