National company KazAvtoZhol has signed an agreement for financing of up to $700 million with a syndicate comprising Halyk Bank, Bank CenterCredit and Eurasian Bank.
The agreement was signed at a roundtable on road-sector financing and the participation of second-tier banks in infrastructure projects. The funds will expand the pool of investment for KazAvtoZhol projects previously supported by the Development Bank of Kazakhstan.
The Development Bank of Kazakhstan’s resources were used in previous years to repair and upgrade highways. Under the new agreement, cooperation will continue through 2034. Halyk Bank is the arranger of the syndicated financing and the agent bank.
Deputy Prime Minister and Minister of National Economy Serik Zhumangarin said the deal would redistribute the credit burden among financial institutions and free up part of the Development Bank of Kazakhstan’s credit limit for new priority infrastructure projects.
Zhumangarin said the agreement does not provide for new borrowing to build roads. Instead, it refinances existing obligations to the Development Bank of Kazakhstan using funds from commercial banks.
According to the deputy prime minister, involving second-tier banks in road infrastructure development can mobilize additional domestic investment, reduce major national projects’ reliance on state funding and increase commercial banks’ participation without significantly raising budget expenditure.
