Own bank capital.

Building of own capital of bank is one of the main indicators of financial activity of bank. Own capital of bank consists of an authorized capital, the reserve fund, special fund, fund of fixed assets, fund of amortization of funds of consumption and accumulation, funds of establishment of the banks directed on production development, fund of reassessment of drags of metals and profit. I.e. performance to banks of the economic standards established by NBK is defined by size of own capital. Its profitability and solvency depends on real size of the capital of bank. The reasons of decrease or at all negative size of own capital of bank can be not only the reasons of all-economic character (not repayment of the loan, short-reception of the planned income), but also policy of the management of the bank which main objective is fast receiving profit that provokes an investment of means in doubtful operations, subjecting to unjustified risk financial wellbeing not only bank, but also the client.

It should be noted that today absolute majority of banks of the second level are the depositary commercial banks having insignificant own capital. At the same time, world experience convincingly shows that the modern bank represents a universal multipurpose financial credit complex with a range of operations and services more than two hundred names. The universal type of bank combining depositary and loan, investment and issue, settlement and payment, information and consulting and numerous «near bank» operations, most fully meets requirements of the modern financial capital, corresponds to activity of diversified concerns. But only insignificant number of the Kazakhstan joint-stock banks, and also with foreign participation have rather large own capital allowing them to become universal banks.

[http://www.visocap.com/ru/default.aspx]

Performance by banks standard legal certificates.

For the purpose of maintenance of financial stability of banks, stability of a monetary and credit system, protection of interests of investors by national bank are established economic specifications, obligatory for performance by banks.

In number of is standard legal certificates established by national bank for their obligatory observance, enter:

* The minimum size of the authorized capital of bank.

* Factor of sufficiency of own means.

* The maximum size of risk on one borrower.

* Liquidity factor.

* Limits of an open currency position.

The authorized fund of bank serves as maintenance of its obligations, is the basic source of carrying out of bank operations and is formed at the expense of sale of actions or payments of founders. The increase in the authorized capital of bank can be formed at the expense of release of additional actions, including at the expense of capitalization of profit of bank and an exchange of bonds of bank for its actions at the expense of increase in a face-value of actions. On a way of formation of the authorized capital banks of the second level of Kazakhstan are subdivided on: joint-stock, private, commercial, joint, affiliated, state, and interstate. The greatest share is necessary on joint-stock banks (60 %) from total number.

The factor of sufficiency of the capital is defined by the relation of own capital of bank and brave actives where the minimum factor of sufficiency of the capital is defined at level of 8 %.

The maximum size of risk on one borrower pays off as the relation of the size of risk (cumulative debts under loans of one borrower plus the sum balance obligations given out concerning this borrower) to own capital of bank.

The norm of factor of the liquidity, defined by the relation of liquid actives and obligations, should be not less than 0,3.

Non-observance of economic specifications is characteristic for small banks. Necessary specifications are observed by large banks that gives a positive effect on development of bank structure and trust increase to it.

[http://business.zakon.kz/bank/]

CREDIT PORTFOLIO.

Condition of a credit portfolio of bank - a certain sort the indicator of a financial position of bank, and its quality depend on a policy of bank regarding placing of the actives, but being the basic source of incomes of bank, a credit portfolio - the main source of risk for placing of the means. According to statutory acts НБ, the uniform order of classification of a loan portfolio and formation of reserves for a covering of losses from credit activity is established. With a view of maintenance of appropriate level of control and reliability of the activity according to character and scale of spent operations banks are obliged to carry out classification of the given out credits and other actives, allocating doubtful and bad debts and creating against them provisions is perfectly in order and on the conditions established НБ according to the legislation of Republic Kazakhstan. The loans given by banks, are subdivided on qualities into following groups:

1. The standard credit is the credit which term of return hasn't come also which quality doesn't raise the doubts, i.e. the borrower is the financially-steady managing subject having high level of security by own capital, high norm of profitability. The bank has on it a credit file. At a reputation estimation the essential role is played by the relation of the borrower to the obligations in last activity.

2. The non-standard credit is a credit bearing insignificant risk which is connected with a delay of return of the credit till 30 days and prolonged no more an once. I.e. it is credits given out by the client which financial position certain unsatisfactory indicators stable, but are available.

3. The unsatisfactory credit-it which duration of delay makes the credit from 30 till 60 days from the date of debts removal into the account of the delayed loans and prolonged more than once. The credits which have been given out to clients, not having the credit file since the moment you-summer residences, concerns the given group of creditors irrespective of observance of term of payments.

4. The doubtful credit-it which duration of delay makes the credit from 60 till 90 days from the date of debts removal into the account of the delayed loans.

5. The unprofitable credit-it delay term on which exceeds the credit of 90 days from the date of debts removal into the account of the delayed loans.

[http://www.investkz.com/en/articles/2162.html]

Specialized credit and financial organizations

The specialized credit and financial organizations arose in the 19th century. A long time they played the subordinated role in the monetary and credit sphere conceding to commercial banks however their role sharply increased in the countries with market economy after the Second World War. It occurred, on the one hand, because of strengthening of value of operations on which these organizations specialized, and to another - because of penetration of these financial amplified specialized institutes into the sphere of action of commercial banks. The pension funds which capitals strongly increased the last decades and which are in the West one of the largest buyers of securities can be an example.

Investment banks are engaged in promotional activity, i.e. perform operations on release and placement in stock market of securities, receiving on it the income. They haven't the right to accept deposits and involve the capitals, as a rule, by sale of own actions or at the expense of the credit of commercial banks. They use the capital for long-term crediting of various branches of an economy. In Kazakhstan they aren't numerous.

The important place in credit system is occupied by extensive group of savings establishments. They involve petty economies and the income which without the aid of credit system can't function as the capital. There are different types of savings establishments: savings banks and cash desks, mutual and savings banks, confidential and savings banks, credit cooperatives.

For insurance companies the specific form of attraction of means - sale of insurance policies is characteristic. They put the received income in the bond and actions of other companies, the state securities. They also provide the long-term credits to the enterprises and the state. In the future their growth in 3,5 times is expected. Pension backgrounds differ on the organization and management, on structure of assets. So there are insured funds (operated by insurance companies) and not insured (operated by the enterprises or for their power of attorney - banks), funded (their means are invested in securities) and aren't funded (pensions are paid from the current receipts and the income) etc. Investment companies place the obligations (actions) among small holders and use the received means for purchase of securities of various branches of an economy. Small investors willingly buy obligations of investment companies, since thanks to a considerable diversification (an investment of means in the various enterprises) is reached known dispersal of assets, decreases danger of loss of savings because of bankrupt firms, the capital is invested in whose actions. Investment check funds in Kazakhstan are, in effect, too investment companies.

Participation in credit system of various credit and financial institutes and OST of interest in its service expanded also financial possibilities of individual possibilities and firms. The owner even small firm receives a wide choice of credit facilities.