The Agency for Regulation and Development of the Financial Market (ARDFM) formalized rules for assessing the financial stability of Kazakh banks. The document gives the regulator a step-by-step response to a credit organization’s decline: from early detection of non-market transactions to applying resolution tools instead of direct liquidation.
Resolution No. 118 is published in the Adilet legal system and takes effect on August 23, 2026.
How the regulator assesses viability
The new rules detail the supervisory assessment procedure. ARDFM will analyze asset structure and quality, including the share of non-performing loans (NPLs) and loans to related parties. The review covers capital adequacy factoring in potential losses, compliance with liquidity ratios, and profitability metrics compared to market peers.
Following the review, the regulator concludes whether the bank can restore stability by executing a special plan or if it is deemed potentially insolvent.
If a bank is recognized as troubled, the agency must assess the feasibility of a bailout. The document outlines four resolution tools:
- forced sale of shares to a new investor;
- restructuring of liabilities;
- transfer of partial assets and liabilities to another bank;
- creation of a stabilization bank.
For systemically important banks, the agency additionally evaluates the possibility of state participation to prevent a domino effect across the financial market.
Strict filter for non-market transactions
A separate section of the resolution targets non-market transactions that lead to bank losses. The regulator established specific markers for such operations.
These include loans where the amount does not match the borrower’s income or collateral value. Suspicious activities involve payment deferrals exceeding one year, issuing loans at rates significantly below market, and providing guarantees without the right of recourse to the debtor. Transactions leading to early satisfaction of claims by major shareholders or bank management also fall under scrutiny.
These criteria apply based on the credit organization’s size. For large players with equity exceeding 100 billion tenge, the threshold for recognizing a transaction as non-market is 1% or more of capital. For banks with capital under 100 billion tenge, this limit is set at 2%.
Systemic risks and critical operations
The document introduces parameters for systemic risks. The regulator considers the status of a systemically important bank, its ties within financial conglomerates, and the risk of instability spreading to other organizations through interbank loans or payment systems.
To protect the economy from infrastructure disruptions, ARDFM approved a list of critical operations. These fall into four categories:
- attracting deposits and maintaining bank accounts;
- lending;
- payment, clearing, settlement, and cash services;
- securities market services.
When assessing these functions, the regulator looks at substitutability. The agency analyzes whether other banks can take over client services without time and cost constraints if the current operator shuts down.
Why it matters
This continues ARDFM’s policy of tightening supervision. Finteqstan previously reported that the agency introduced a 14-day cooling-off period for consumer loans; now the focus shifts to the macroprudential protection of the banking system itself.
The differentiated approach to non-market transactions gives mid-sized banks a slightly larger operational corridor (2% versus 1%), but classifying operations as “critical” means closer monitoring of their continuity.
The document prepares the legal framework to ensure that in a crisis involving an individual bank, the focus is on saving its systemic functions—payments, deposits, and settlements—rather than the institution itself.