Abstract
Kazakhstan tackled bank restructuring through anti-crisis program which linked bank recapitalization to improvements in the bank's operating system aiming at increasing efficiency and loan recovery. Thanks to the program, many steps towards recovering the banking system have been adopted. Four major banks have been recapitalized by the Government. The lesson here is that solving stock problem through bank recapitalization is necessary but not sufficient. Rather, bank recapitalizations without additional measures to improve bank skills and to provide sound performance incentives are likely to fail. The restructuring allowed the banks to clean up the portfolios from stressed assets, significantly reduce the foreign debts and concentrate on its sustainable development, in which most of the efforts aimed at restoring assets and conducting large-scale work to increase public confidence and to attract deposits.