Wednesday, May 02, 2012 -
Malaysia will not buy struggling Kyrgyz financial institution Zalkar Bank but hopes to open several branches of a Malaysian branch in the country once the bank is sold, the Kyrgyz ambassador to Malaysia said Wednesday.
“Investors are waiting for permission to open its branch [of Maybank],” the Knews.kg news agency reported Kyrgyz Ambassador to Malaysia Askar Beshimov as saying in the Kyrgyz capital Bishkek.
“In addition, they await the completion of sales of the old banks of Zalkar Bank and the Investment Bank of the Issyk-Kul. But Malaysian investors rejected the offer to purchase Zalkar Bank.”
The state-owned bank has been looking for a buyer following four previous failed auctions. Investors are concerned that the bank is at the risk of being re-nationalized.
The bank has reduced its selling price from $23.5 million to $15 million, but the International Monetary Fund (IMF), which has been consulted on the sale of the bank, still says the price is still too high.
Some of the bank’s main assets have been frozen by the prosecutor-general, because of purported links with the son of the previous president.
Kyrgyzstan’s central bank has forbidden Zalkar from offering Internet banking service. It is also barred from issuing letters of credit and guarantees for collateral. Furthermore, the bank is not permitted to open any new branches.