The FINANCIAL -- Moody's Investors Service has today placed the Ba2 long-term bank deposit and Ba2/Ba3 senior and subordinated debt ratings of Alliance Bank on review for possible downgrade.

 The bank's E+ bank financial strength rating (BFSR) and Not Prime short-term ratings
are not affected by the review and have been affirmed.

At the same time, Moody's has placed the Ba3 long-term foreign and local currency issuer ratings of Seimar Alliance Financial Corporation (Kazakhstan) (SAFC), a holding company of the bank, on review for possible downgrade.

Moody's rating action has been prompted by a weakening of Alliance Bank's BFSR within the E+ category, with the BFSR now mapping to a Baseline Credit Assessment of B2 compared to B1 previously. This weakening is a result of the deteriorating quality of the bank's loan portfolio,
liquidity concerns arising from the outflow of customer deposits from the bank and significant refinancing issues related to its ongoing high reliance on wholesale sources of funding along with its continuing limited access to the market for refinancing.

Moody's said that the rating review will focus on: (i) developments with regard to Alliance Bank's customer deposit base, which, along with the high reliance on wholesale funding, raises material concerns about the bank's funding and liquidity profile, (ii) the bank's ability to generate sufficient operating income in the longer term, and (iii) the impact on capital and profitability of possible future write-downs and impairment charges associated with the declining trend in the bank's loan portfolio.

Moody's review will also reassess the systemic support assumptions incorporated in the bank's debt and deposit ratings given its declining market share, particularly in deposit-taking.

Moody's previous rating action on Alliance Bank and SAFC was in November 2007, when it changed the outlook on all of the bank's and holding company's deposit and debt ratings to negative from stable to reflect the negative impact of the continued credit and liquidity crisis on the
bank's credit risk.

Alliance Bank, which is headquartered in Almaty, Kazakhstan, had assets of KZT1,137 billion (US$9.4 billion) at end-March 2008.

Alliance Bank is the principal operating subsidiary of SAFC in terms of balance sheet size and profitability, accounting for 96% of SAFC's  assets.

Based in Almaty, Kazakhstan, SAFC is a holding company that includes a banking segment (represented largely by Alliance Bank), as well as non-banking lending, life and non-life insurance, financial brokerage and business support segments.

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