EBRD Organises $300 Million Syndicated Loan for Modernisation of Kazakh Railways

ASTANA – The European Bank for Reconstruction and Development (EBRD) and a group of international commercial banks are providing a syndicated financing package of $300 million in support of a comprehensive modernisation and restructuring programme of Kazakhstan Temir Zholy (KTZ), the country’s rail operator, the lender said in a July 27 press release. The proceeds of the loan will be used to refinance KTZ’s eurobonds.

Photo credit: kapital.kz

Photo credit: kapital.kz

KTZ is a national railway company that manages railway infrastructure and operates freight and a large share of passenger train services.

The EBRD will extend $150 million of this amount for its own account and syndicate the remaining $150 million to commercial banks. The syndicate comprises the following banks: Citibank, NA, London branch; Mizuho Bank, Ltd; Société Générale; Sumitomo Mitsui Banking Corporation; and the Bank of Tokyo-Mitsubishi UFJ, Ltd.

The signing ceremony took place at the EBRD headquarters in London in the presence of representatives of the EBRD, KTZ and the Kazakh Embassy in the UK.

As part of the project, the EBRD will engage with KTZ on tariff system reform and the ongoing business transformation of the company. KTZ will also continue to implement sustainable energy technologies, which are a constant feature of its long-term cooperation with the EBRD.

Natalia Khanjenkova, EBRD managing director for Turkey and Central Asia, said at the signing at the bank’s headquarters in London: “We are proud to further support railway sector reform in Kazakhstan with this syndicated financing package. International financiers’ interest in the project demonstrates investor confidence in KTZ and Kazakhstan.”

Sholpan Omarbekova, KTZ managing director for finance and economics, added: “With this new transaction the EBRD will not only provide financing, but also assist KTZ with advancing the reform of the regulatory framework in the sector.”

To date, the EBRD has invested more than $7 billion in various sectors of Kazakhstan’s economy. The bank is the largest investor in the non-oil and gas sectors of the country’s economy. The EBRD, owned by 64 countries and two intergovernmental institutions, is supporting the development of market economies and democracies.

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