Kazakhstan’s government has announced that it may well buy stock valued at around $5 billion in the nation’s four biggest banks to boost capitalization and liquidity amid the global financial turmoil. The state expects to buy 25 percent of voting stock in the four biggest banks – BTA Bank, Kazkommertsbank, Halyk Savings Bank and Alliance Bank sell new shares, according to a statement from the prime minister’s office today. The measures are designed “to keep the volumes of lending for the domestic economy, and increase financing of small and medium enterprises,” the statement said.

Kazakhstan also passed laws last week aimed at preventing defaults at ailing banks as the global financial crisis deepens. Kazakh banks posted a 61 percent drop in profit in the first nine months as they set aside cash to cover bad loans as the economic growth rate slows.

Kazakhstan is also willing to discuss “similar initiatives” in the case of shares of Italy’s troubled UniCredit SpA, which owns Almaty-based ATF Bank, and South Korea’s Kookmin Bank, which is a shareholder in Bank Centercredit.

Combined net income at the Kazakhstan’s 36 banks dropped to 71 billion tenge ($593 million) from the 184.4 billion tenge reported by 33 banks a year earlier, according to a recent report from the Financial Supervision Agency.

State purchases of shares in banks and the ability to remove managers, halt dividend payments and limit new deposits were the key measures identified under new laws published last week.

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