ASTANA – S&P Global Ratings improved its assessment of Kazakhstan’s banking industry risk and upgraded or raised the outlooks on several financial institutions, citing stronger supervision as credit growth and banking-sector profits slowed in the first seven months of 2026.
Photo credit: the Agency for Regulation and Development of the Financial Market. In its Sept. 4 release, S&P said stronger supervision, banks’ capital buffers and Kazakhstan’s sovereign strength should help preserve financial stability during economic downturns.
The agency raised Bank CenterCredit’s long-term issuer credit rating to BB+ from BB and assigned positive outlooks to Halyk Bank, Nurbank, Freedom Holding Corp. and four of its core subsidiaries. It also raised national-scale ratings on Nurbank, Freedom Finance and Freedom Bank Kazakhstan.
S&P improved its assessment of Kazakhstan’s banking industry risk to 6 from 7 under its Banking Industry Country Risk Assessment, or BICRA, framework. The economic-risk score remained at 7, while the starting point S&P used to rate Kazakh banks remained unchanged at BB.
Scores range from one to 10, with one representing the lowest risk. The revision, according to the agency, reflects the “number of initiatives undertaken by the Kazakh regulator to enhance supervision of the financial institutions in Kazakhstan over recent years.” Among the highlighted improvements are regular systemwide asset-quality reviews, the adoption of the Supervisory Review and Evaluation Process, or SREP, and measures to curb banks’ risk appetite, particularly in the rapidly expanding retail lending segment.
The agency also said stronger oversight should help banks withstand periods of heightened uncertainty stemming from geopolitical risks and their potential effects on commodity prices, supply chains, economic activity and credit conditions. S&P also revised the trend for Kazakhstan’s economic risk assessment to positive while leaving its score unchanged at 7.
The change indicates that the score could improve if inflationary pressures ease and banks’ asset quality strengthens. “This reflects our expectation of a resilient macroeconomic perspective with solid GDP growth over the next couple of years and reducing risks for the banking system,” S&P said.
The agency said an improvement would require evidence that economic imbalances, particularly elevated inflation, are putting less pressure on banks and nonbank financial institutions. Any improvement would also depend on stronger asset-quality indicators, which it considers a weakness of Kazakhstan’s banking sector, supported by more effective regulatory oversight.
S&P said Kazakhstan’s banks could benefit as inflation slows and the National Bank gradually cuts interest rates. Annual inflation declined from 10.2% in July to 9.8% in August, while the National Bank has lowered its base rate by a total of 1.25 percentage points since the beginning of the year.
The agency expects inflation to ease to 7-9% in 2027 and 2028, and slower price growth could leave households with more disposable income and make it easier for borrowers to repay their loans, reducing risks for banks.