The Kazakhstan Stock Exchange (KASE) is in talks regarding the possibility of repurchasing shares from the Moscow Exchange, according to KASE Board Chairman Alina Aldambergen at a recent briefing.
"It is deemed necessary to terminate the participation of the Moscow Exchange in the capital of the Kazakhstan Stock Exchange. We are planning and conducting negotiations on the possibility of repurchasing shares from the Moscow Exchange, which can either be carried out by the exchange itself or sold to third parties, but in coordination with KASE, given the significant share held by the Moscow Exchange," said Aldambergen in response to a question about the repurchase negotiations.
Having a sanctioned entity as a shareholder poses a risk to KASE, potentially leading to the suspension of services or individual payments, she noted. "As the central link of Kazakhstan's currency market, such situations are unacceptable for the exchange," explained Aldambergen.
She also highlighted that the presence of a sanctioned entity among the exchange’s shareholders affects KASE's relations with foreign financial organizations and partners. "We are a counterparty and organize trade in foreign currencies such as dollar-tenge, euro-tenge, and yuan-tenge pairs. Consequently, we undergo sanctions analysis with our counterparties, including foreign banks," Aldambergen clarified.
On June 12, the US Treasury Department imposed sanctions against the Moscow Exchange and the National Clearing Center, a part of the Moscow Exchange Group. In response, the Moscow Exchange announced the suspension of trading in the dollar and euro from June 13. The Bank of Russia stated that citizens and companies could still buy and sell dollars and euros despite the sanctions, with the regulator using bank statements and information from over-the-counter trading to determine exchange rates.
As of June 1, 2024, the Moscow Exchange owns 13.1% of the outstanding shares of KASE. While US sanctions apply to entities owning 50% or more of the shares, the presence of the Moscow Exchange remains a concern for KASE.
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Based on TASS materials