S&P downgrades Alliance Bank

Standard & Poor's said it revised its long- and short-term counterparty credit ratings on Alliance Bank JSC to D/D from CCC/C.

At the same time, the agency lowered its Kazakhstan national scale rating on the bank to D from kzCCC+.

S&P also lowered its ratings on the bank's senior unsecured debt to CC from CCC and the ratings on the subordinated debt to C from CCC.

The agency said Alliance Bank failed to pay holders of its "recovery notes," due Dec. 26, 2013. According to its definition, this means the bank is in default, leading to a rating that is D (default) or SD (selective default).

Additionally, due to this nonpayment, the bank breached regulatory liquidity requirements, which appears to constitute a covenant breach under Condition 11 (l) of the documentation for the par notes and discount notes, two further classes of senior unsecured debt.

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