Chapter 1. Theoretical aspects and the economic substance of consumer credit 1.1.

Theoretical aspects of consumer credit Before the Second World War, almost all commercial banks are trying not to lend to individuals, believing that this type of service is not profitable. But at the beginning of this century, the situation has changed, as banks are now increasingly needed in working with individuals because of their mi deposits were sources of resources to finance large loans granted to corporations. Tightening competition among banks has forced banks to expand the range of services, so in 1920 - 1930 years, a group of several major banks, led by one of the forerunners of the New York "Citicorp" and "Bank of America," created in his first department of consumer credit . Beginning in the 1930s, the sector of consumer lending has become one of the most acutely in developing segments of bank credit. But since the mid 1950s, consumer credit was widespread in Germany, France, Italy, Sweden, and later - in Japan. Only recently has the growth rate of this sector has slowed down due to increased competition for consumer credit accounts and downs of the population of stimulus to save money, however, means consumers are still the main source of funds and a major source of income of today's commercial banks. Today in Germany, specialized banks operating in consumer credit, consumer credit repayment by special rules, and emerged on the example of the United States after World War II. At the beginning of the 1990s in Germany there were 112 banks in consumer credit. In Britain, the so-called financial houses are specialized banks issuing consumer loans. Approximately two thirds of their active operations account for consumer credit in installments, in turn, more than 60% of these loans is financing car purchases. The economic essence of any phenomenon, any economic category implies the existence of certain features, characteristics. Thus, among the features of consumer credit are the following: 1) Consumer loans are the people (individuals) Historically, that the volume of consumer lending in the country were small, whereas in developed countries the share of loans to individuals are often higher than corporate loans (in the U.S. about 46%). 2) Consumer credit allows you to expand consumer demand with a relatively limited cash incomes. 3) Consumer credit can be applied both in cash and in kind. 4) Personal loans can be used by the state during periods of adverse economic conditions to maintain demand for goods and services to housing at a certain level, and in order to pursue an active social policy through the provision of concessional (free or low-interest) loans to the poor.
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5) The consumer credit in its developed form is predominantly medium to long term in nature. 6) Consumer credit takes the form of bank credit and commercial loan relationship of these forms of credit appears in the following example, the trading company, selling durable goods on credit, make a bill, accepted by the buyer to improve their financial capacity, Firm considers these bonds to commercial banks . Classification of consumer loans can be made on a number of grounds for issuance of forms, by way of organization, by way of repayment of the subjects of credit relations, etc. Schematic classification is presented in Table 1. Wider dissemination of consumer credit was in Western countries. Unlike other loans, the subject of consumer credit may be commodities, and money. Goods sold on credit, as well as paid through bank loans, are the objects of consumer durables. The subjects of the loan, on the one hand are the creditors, in this case - are commercial banks, specialized agencies of consumer credit, stores, savings banks and other businesses, but on the other hand - the borrowers - people. In France, about one quarter of all consumer credit granted by banks and 3 / 4 specialized credit institutions. Table 1 - Classification of consumer credit To ensure: By forms of delivery: For issuance: Unsecured (blank) - Trade credit - Short-term (up to 1 year) - secured - Medium (1g. -3-5 years) (mortgage, guarantee) - Money loan - Long-term (more than 35 years) According to the method of repayment: - Direct - Indirect According to the method of repayment: - Direct - Indirect By way of - organized - fugitive consumer credit organizing

By the nature circuit: - one-time - renewable

of

the

By purpose: - Purchase of goods, payment for services - For the purchase, repair and reconstruction of housing - By credit card, etc.

On the subjects of credit relationships: - Bank loans - Trade credit agencies such as the non-bank - Consumer loans to individuals

By the time of collection% - Loans with retention% at the time of - Loans with payment installments equal to% - Loan from annuitentnym payment (payment at the same time %)

But as the latter receive the tools they need a greater extent through bank loans, the actual 9 / 10 the total amount of consumer credit provided by banks. Consumer credit is repaid in one-off payment or settlement. 1) Credit with a one-time repayment. These include current accounts opened by the purchaser for a period of 1-1.5 months in department stores and other retail outlets, within the limits of loans they purchase goods and, at maturity, at a time paying down debt. Consumer loan with a one-time repayment of loans includes a form of deferred payment (for services to utility companies, doctors and medical institutions). 2) The loan by installments, the bulk of consumer credit (in the U.S. - 3 / 4 of its total) are loans with deferred payment. Through various forms of consumer credit served an increasing share of retail turnover. Particular development in consumer credit was the general crisis of capitalism (especially after the second World War, 1939-1945) due to a sharp increase in disparity between increasing production and the limited purchasing power of workers [9, s.455]. Credit in the economy, has certain responsibilities: - Exposes the reallocation of capital between sectors of the economy and thereby contributes to the formation rate of profit; - Stimulates the efficiency of labor; - Expanding market for commodities; - Speeds up the process of selling goods for profit; - Is a powerful tool for the centralization of capital; - Speeds up the process of accumulation and concentration of capital; - Provides a reduction in distribution costs.
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Credit plays an important role in reducing the distribution costs associated with the circulation of commodities and coins. Due to the fact that consumer credit accelerates the sale of goods, reduced costs associated with their packaging and storage. The savings on the costs of the same coin circulation is achieved by: - The development of cashless payments. On the basis of credit and banks are able to produce without payment of cash by transferring funds from an account debtor on account of the creditor; - Increase in money velocity. With the help of loan capital and free cash savings are placed by their owners to the banks, and the latter by providing loans to keep them out of circulation. The turnover of money is accelerated by the fact that credit purchases eliminates the need for prior accumulation of money and debt can be paid immediately upon receipt of income. Thus, loan and credit system minimizes reserve money as purchasing and payment of funds in each of the physical and legal entities; - Replacement of metallic money loan - bank notes. As soon as the development of capitalism develops and loan banks, hard money is increasingly replaced by credit money, providing the entire capitalist class a huge cost savings of money. Beginning with World War I, in most capitalist countries, and with the global economic crisis 1929-1933 GG in all countries of coins ceased to serve as a means of treatment and payment. Since then, the coins in the country completely changed credit money and credit operations. "Credit, breaking the boundaries of handling full of cash, thereby expanding the boundaries of production" [10, p.157]. Consumer credit is very good stimulates the efficiency of labor. Receiving wages, insufficient to purchase for cash of certain goods, particularly durable goods, people are able to buy these goods on credit or take out a loan for their purchase. Subsequently, the money for these goods must be paid, so everyone who has taken on credit, is trying to survive in the workplace, as long as possible, ie for a longer period of time. The only way he can be confident in their abilities to repay the loan and prove itself to lenders as an honest and conscientious person, for further links. But as they say in a proverb: "He who borrows sells his freedom." And it really is, a consumer loan may be "debt pit" because, deprived of income as a result of unemployment or even any reason, it may be a situation that people can not repay their debts. It is important also to note that consumer credit reduces employee turnover by what makes people like you can firmly hold on to their jobs. Reducing employee turnover positively affects the economy of the country. In the end, I must say that consumer credit is a very strong factor in improving the people's welfare. But as they say, there are no bad without good, as good without
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the bad, and here. Please note that "consumer credit, temporarily boosting the growth of production, and the illusion of high conjuncture, ultimately, may help to ease the production beyond the purchasing power of population growth exacerbate overproduction and economic crisis" [4]. Payment by credit card - this is another convenient option, provided that the customer's credit limit is sufficient to purchase the goods. Filling in some form (ie, treatment for a loan) is not necessary, and the person can pay the money over a longer period than has been determined. However, this can be an expensive service, and since the early 1990s, more and more consumers are trying to spend on their credit cards as much as they can be fully paid at the end of the month to avoid any interest costs. Increased competition has reduced profit from services provided by universal banks, especially in view of the fact that the largest of them agreed to lower royalties due to its high speed. It is connected with this important cause of the introduction of fees for cardholders. Banks are currently prescribed annual fees cardholders. This is done to increase the number of account holders that fully utilize the account balances at the end of the month and thus do not pay any interest. Only a few companies that issue credit cards, give a guarantee not to introduce annual charges. Consumer credit lending institutions is based on two forms: 1) Direct loans consumers without intermediary trading companies. In Germany, banks give customers-borrowers credit checks on the round sum (10-20-50 DM), which are used to pay for goods traders. These firms, in turn, receive a cash or bank transfers to current accounts. In this case, the lender banks that consumers repay their loans on time; 2) Loans to customers with a guarantee of trading companies. The Bank enters into a contract with a trading company, undertaking to a specified amount of its credit customers. Trading company takes on debt guarantee to the bank and borrowers at the same time enters into a contract with their customers, which is determined by the amount of the loan, its terms and maturities. These contracts are transferred to the bank that pays the company 80-90% of loan amount, and the rest of the credits for a special escrow account. The buyer repays the loan in installments, bought them on credit goods serve as collateral payment. In case of default of the loan period the amounts levied by the bank in a blocked account. Overdrafts. Overdraft - a form of short-term loan provision which the writeoff of the client's account (in excess of the account balance), resulting in a debit balance. The right to use an overdraft facility available to customers the most reliable [17, 166]. Associated with overdraft the following factors:
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1) Amount. The amount of the debit shall not exceed the limit agreed by the bank and the borrower. The limit is usually defined relative to the known income. 2) Margin. The percentage assigned to the amount of the overdraft, usually as a margin above the base rate. The percentage has on the daily amount of the overdraft and quarterly written on the account. Fee can be obtained when the bank agrees to provide benefits to the client, even if it is not fully used. 3) Purpose. Overdrafts are usually required to cover short-term contracts - for example, many people find themselves with no money at the end of each month before they are paid salaries. 4) Payment. Overdrafts payable on demand, and usually the client of this written notification of the services provided. 5) Provision. Security required by the bank, depending on the size of the service provided by the client. 6) Benefits. For people overdrafts are very convenient, because they can feel confident that their costs are funded, even if they exceed their available funds at the moment. The bank benefits from the provision of high interest rates, but suffers from being due to large fluctuations in the amount of overdrafts, he is forced to have available sufficient funds to provide a consistent credit limit [18, p.171]. Scoring "lending." Due to the high volume of personal loans and a relatively small amount of each loan, most banks can not afford to evaluate applications for loans, considering each request individually. Therefore, instead of statements was entered "scoring" - lending. Some of the banks in the prescribed manner requesting information about the applicant in the credit reference agencies, others do so only in extreme cases. "Scoring" - lending is impersonal, but a quick and easy form, than a business conversation. The potential customer fills out an application in the prescribed form, containing information on age, marital status and seniority. Each question has a maximum possible score to be higher for such important issues as a profession, and lower for issues such as age. After the final scoring by hand or using a computer bank determines which service to provide more reasonable to the client: a loan or overdraft. Conditions and procedures for granting consumer credit. 1.2. Features of the consumer credit abroad In the period after World War II banks are major creditors in consumer credit. The dominant position of banks is partly a consequence of the fact that they are increasingly interested in raising funds for individuals and families who are the main source of bank funds. However, many families often have to decide whether
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to give their money to the bank, which they believe can not guarantee them a loan if necessary. Recent studies have shown that consumer credit is often among the most profitable loans that the bank may issue [19. 334]. Types of loans to individuals and families. In foreign practice, consumer loans provided by the public call for the purchase of consumer durables. Individuals use a variety of other loans (including construction and acquisition of housing, emergency needs, etc.). This practice has evolved over decades and is diverse. First of all, it is characterized by a variety of lenders: Bank consumer loans, loans to commercial organizations, consumer loan lending institutions such as the non-bank (pawn shops, rental, mutual aid funds, credit cooperatives, building societies, pension funds, etc.), personal or private consumer loans (provided by private persons); consumer courts, provided the borrowers directly to enterprises and organizations in the workplace. In Germany, the most common form of consumer credit acts as a loan in cash advance. It is advantageous to the borrower, since the payment for goods in cash shop can make the client a discount of up to 5% of the value of goods for use in such a loan the bank sets a fixed interest rate for the life of the loan agreement Interest rate is relatively low maximum service life of consumer credit in Germany is 6 years Monthly payment in repayment of a loan depends on the size of the loan, the term of the loan agreement, the interest rate. After determining the amount of the payment, its amount is automatically collected monthly from a checking account customer. Consumer loans in the U.S. (sonsumer loans) are divided into 3 groups: - Loans with deferred payment; - Turret (revolving) loans; - Loans with no installment payment Of the total amount of consumer credit for more than 80% are on loan by installments. Maturities typically range from 2 to 5 years. In contrast, revolving loans, most loans with installment payments are secured. In the U.S., as well as in other Western countries, loans with installment payment may be made in a direct or indirect forms. In the direct loan is a loan agreement between the bank and the borrower. When issuing an indirect bank lending appears an intermediary between the bank and the customer - commercial enterprise. There is agreement between the customer and the store, which then receives a loan from a bank. Revolving loans include loans to customers on credit cards or loans in the form of an overdraft. (Credit cards and overdrafts will be discussed below). Loans with no installment payments are an important feature - on such loans
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repayment of the loan and interest shall at once. As an example, "bridging loans" outstanding to purchase a new home by a private person, and the amount of the difference of old and new home owner. France also allocated personal loans - is revolving loan to an individual for a period of three months to three years to no more than one-fourth of the annual income of a person usually when issuing a loan guarantee requires the third party plays an important role condition "domicile" of income, then has received the borrower's income to a bank account, where the latter can monitor its financial position. Consumer loans are similar in terms of personal loans, but interest rates on them below They are issued to pay invoices for the purchase of goods in the stores covered by the system of consumer credit. ("Setelem" (Setelem), "Kofinoga" (Sofinoga), etc.). In the UK consumer credit is given for different purposes: the purchase of consumer durables, machinery purchases (maximum allowable term for a used car - 5 years) celebration of the festivities, for decorating the house, buying houses, caravans, payment of personal education. Loans are issued for amounts over 500 but not more than 10 000 pounds sterling. Individual borrowers the opportunity to insure the loan in case of death, unemployment, accident or illness of the borrower, the loan maximum loan period - 5 years. Also, banks may at their own expense to cover payments to customers in the event of illness or accident, and at the client's death until the last of the loan will be repaid by the bank in full. But at the same monthly payment increases to the customer a small amount of insurance. Insurance client is automatic and does not involve filling in special forms or medical examination. Of insurance may be waived by notifying the Bank in writing in a statement in a loan In the U.S., most Americans provide consumer loans, commercial banks (44%), but they are actively competing financial companies (about 24%), credit cooperatives (13.9%) and specialized savings institutions (10.7%). However, the role of savings and loan institutions after the crisis of the 1990s, declined sharply. A similar practice is observed in Western Europe, where almost all the lending institutions of universal banks (eg in Germany) to specialized savings institutions (mutual savings bank in the UK and savings banks in other countries) perform a variety of lending services of individual borrowers.

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Chapter 2. Modern analysis of consumer credit in the Republic of Kazakhstan 2.1. Organization of monetary policy in the second-tier banks of Kazakhstan Kazakh banking system is oligopolistic. On the three major banks - JSC "Kazkommertsbank", JSC "BTA Bank" JSC "Halyk Bank of Kazakhstan" - has 60.95% of the assets of the banking system. For purposes of analysis of business activity were collected financial data for the 10 largest banks in Kazakhstan as of 01.02.2007.
Name of bank balancesheet 286.04 228.68 219.11 68.00 59.66 29.24 46.95 29.88 32.55 24.22 179.56 liquid assets 12.62 11.50 13.45 7.49 6.75 3.13 11.39 2.36 2.78 2.47 14.61 First level Capital 25.37 22.35 16.76 5.48 4.99 5.47 5.70 5.38 4.32 3.83 32.46 Liabilities to customers 359.52 335.54 333.15 234.40 233.75 215.72 214.82 209.46 207.76 210.59 301.52 Financial assets 257.72 215.17 201.10 63.30 55.41 28.19 44.48 27.95 30.87 21.98 162.15 Tangible assets 4.42 1.46 07.07 1.83 1.22 0.49 0.65 1.02 0.28 1.27 8.89

JSCKazkommertsbank" JSC "BTA" "Halyk Bank of Kazakhstan" JSC "ATF" JSC "Bank CenterCredit" JSC "Citibank Kazakhstan" "Nurbank" JSC "DAB ABN AMROBankKazahstan JSC Eurasian Bank JSC "Temir Bank" Others

The concentration of the loan portfolio is traditionally present in the commercial sector, as Temir Bank is initially a "Commercial" Bank. However, the Bank continues to gain experience in financing small and medium businesses. Drawn loans, which are generally individuals credit application, after direct contact the borrower. And this polysyllabic divided into three main stages. Is contacted with the bank, ie client applies for an interview with loan officer, and found out umosti a loan. This interview is important for the lender because the conversation clarified the nature of the client and intentions. If the other party tries to hide the real reasons for the need for credit, you may have suspicions about it. This can be a strong negative factor when considering the application. Necessary to verify the home address and offices. Credit inspector can obtain additional lenders who have with the customer credit relationships, learn safety behavior, ie, served if all the client and whether
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sufficient account balances. Customer file, usually reflect enough details about the features of behavior, it is the real attitude toward money and a sense of duty and responsibility when using a bank loan. To solve the problems associated with the return of consumer loans formed a new, simplified credit conditions. Thus, along with the rules of providing certain types of loans has changed significantly and the mechanism of consumer credit. The new primary lending activities of enterprises, known as credit on total inventory and production costs, effective from I January 2005. This lending is largely unified, and its main provisions apply for a loan of most sectors of the economy. The main link in the banking system, in this case, Alliance Bank - a bank branch was much more human in maneuvering his existing credit facilities, and their redistribution in lending, as well as in decisions on the application of economic sanctions to enterprises. The new credit mechanism is technically simpler than previously existed. Thus, in accordance with the previous order of lending credit issued separately in each case under such standardized items of working capital as raw materials, WIP, finished goods. Issuance of each loan was accompanied by a representation of the company to the bank statements, information on the balances of inventory, plan their movement and the urgent obligation to repay the loan. In this framework, introduced a system of assessing the creditworthiness of the borrower. Thus, in practice, foreign banks are two interrelated method of determining the creditworthiness of the individual. The first (logical) is based on expertise in forecasting and balanced analysis suggests the personal qualities and financial condition of potential borrowers. Expert assessment characterizes the degree of preference for some other indicators. Based on available information specialist bank seeks to create "generic image" of the applicant for a loan and compare it with the "standard way" borrowers, which are associated (from past experience) with different levels of credit risk. Logical method of assessing the solvency generally supported the development of a monitoring network, revealing credit history of potential customers. For this purpose, banks in many developed economies are information services of credit bureaus, which constantly accumulate and summarize information about the financial and property status of potential borrowers, and also pay attention to the scoring method. According to the draft law the credit bureaus, usually organized associations of trade and financial companies, although not excluded cases and the establishment of independent offices. These agencies collect financial information not only on current but also potential customers of participating enterprises.
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These data include not only information about the client's income, but a tentative assessment of customer accounts in banks, data provided and repaid loans. In addition, the files on the client may also contain information potentially affecting its creditworthiness: marital status, number of dependents, lawsuits, and sometimes the personal characteristics of the client: the data on academic performance in schools, where his client, possible complications in personal relationships (eg, a potential divorce), moral character, etc. Scoring system for the credit assessment of individuals for several years, is being developed in domestic banks. At the present time express - loans offer 8 banks. However, the scoring is mainly used to strengthen the partnership of credit and trade organizations in the form of a staff member of the bank, being directly in the store - take from those who buy goods on credit completed questionnaires containing the necessary customer information (personal data, data of identity document the address of residence registration and the address of actual residence: social status, marital status, number of children and dependents: the size of personal and family income, property type, information about education and the workplace, etc.). Adapted for rapid processing of such forms promptly transmitted to the appropriate branch of the bank where the light material of its own archive of the decision to grant or deny a loan. This procedure takes about one hour. If a positive decision, the parameters of credit (interest rate, amount and term of the loan, the value of the initial self-assessment) are set according to assessed on a scale reliability of the borrower and the social value of the purchased goods to them. Thus, the retail lending market in Kazakhstan, as well as any other, is characterized by supply and demand. Today, the supply side of the Kazakhstan market extensively represented loans from banks, traders, real estate firms, construction companies, pawn organizations. The basis of credit in most cases the bank capital. Typically, a firm that offers a product in installments, works affiliated with one or several banks. You can verify this by making a ten - twenty calls to the advertised telephone numbers. Most often, you just warn that you'll have to deal with this or that bank, which will pay for your purchase. With up to three banks, for example, operates a well-known in the republic car trader - company MERCUR, offering credit to Audi and Volkswagen, subject to payment at once 30% of the car. The remaining 70% to pay for various conditions of banks on the customer's choice. JSC "TehaKaBank" provides a loan against a car purchased with an interest rate of remuneration, including liability insurance, and taxes of 16-20% per annum in foreign currency. Bank "BTA" also
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lends under 15-23%, but the security of their own valuable property clients - real estate, yet something solid. Under similar conditions, but cheaper (under 16%), ready to purchase credits for MERCUR "Bank Center Credit." Offer a very active lending observed in the real estate market. Thus, an affiliate of the Bank "BTA" Company "BTA-Mortgage 'touts housing loans for 5 years at 14-16% per annum. The project works with realtors bank, lending to the purchase of apartments, both the primary and the secondary housing market, as well as enter into contracts with construction companies for the construction of houses. Along with housing loans at an average cost of a wide range of real estate. In Almaty, there are several firms that specialize in the construction and sale of such housing. An example would be the last sentence of "Basis-A" in a luxury apartment building on the corner of Furmanov and Al-Farabi - four flat area of 280 square meters. m value of $ 450 thousand at least 10% of this amount is required to make at once, the rest of bank loans in the form of mortgages under 14-16% per annum in exchange for up to 20 years, always with liquid collateral. In addition to the mortgage, which is a legally issued as a loan from banks, construction companies and realtors practicing finance leases. No fundamental differences: the same 10% of the cost (at least - more), construction firms are asked to pay immediately, but 18-22% per year will demand as a reward. As mortgages and leases provides for the complete alienation of the apartment only after paying the entire amount. In addition to cars and property, which are the most widespread and still quite expensive niche market retail lending in Kazakhstan today in installments, you can: - Get an education; - Purchase of consumer goods (eg appliances); - To get money for any personal needs (medical operation, honeymoon, etc.); - To get money to open a private business, etc. Note that for consumer goods are credited to the commercial banks, industrial durable goods: furniture, sanitary ware, audio, video - and home appliances, computer and office equipment, other consumer goods. Thus, analyzing the market for retail lending the Republic of Kazakhstan, we note that in recent years the share of loans to individuals increased markedly. After a long decline in the share of credits received by individuals (by early 2006 it was 3.9% of the loan portfolio of banks), the 2006 growth rate of the loan portfolio credit growth substantially
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inferior citizens - by mid-year population share of loans already amounted to 5.5%.

2.2. The organization of consumer credit on example of JSC "Temir Bank" Joint Stock Company Temirbank was established on 26 March 1992 with a headoffice in Almaty. The branch network of the Bank includes 50 sales outlets, being represented almost in all regional centers of Kazakhstan in the cities with a population of over 100 thousand people. As of 01.01.2006 assets of the Bank equaled KZT 74,402 mln., net profit in 2005 reached KZT 2,617 mln. Bank's personnel comprises about 1,400 people. Today Temirbank is a universal financial institution rendering a wide range of services both to corporate and individual clients. The Bank is authorized to participate in the Small Enterprises Support Fund, financing small and medium sized businesses under programs of European Bank for Reconstruction and Development, Asian Development Bank (ADB) and International Bank for Reconstruction and Development (IBRD). In mid 2005 in view of the growth prospects of retail market, the Bank's management decided to position it as a niche player in retail sector, earning on mass replication of products for individuals. Pursuant to development strategy for 20062006 adopted and approved by the Board of Temirbank's Directors, the Bank implemented process of active transition into retail bank. Bank products sales plan in 2006 is based on strategic idea of aggressive development of credit instruments for individuals: mortgage and car loans, consumer and business purpose loans. Temirbank is ready to ensure access to maximal range of bank products for diverse social groups and categories of Kazakhstan population. The advanced system implemented Temirbank, equipped with the latest software that allows to record and analyze detailed information on the movement of the flow of visitors, the average waiting time and customer service bank [27]. JSC "Temirbank" offers loans under individual lending programs and guarantees an individual approach to each client, confidentiality, projects and other financial information, a flexible approach to collateral. Retail credit program include: - Loans for purchasing a car (the program "Auto-luxe" program "Auto Comfort" and the "Auto Touring"); - Housing loans (12 programs);
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- Loans for the purchase of goods and services; - Quick loans; - Loans for tuition; - Business loans. Loans for construction and repair of housing. The determining factors in making lending decisions are business performance of the borrower, the profitability of the project financed, collateral, as well as maintaining a stable speed with the Bank. The volume of loans provided as determined by the creditworthiness of the borrower, industry and regional characteristics of the business, the provision of collateral. Consumer lending program of JSC "Temirbank" - a package of "Youth" for housing young families. Loan period - from 20 to 30 years. Credit currency tenge. Maximum loan amount - no more than 95% of the appraised value of the property. Method of payment - annuity payments (monthly). The initial fee - 5% (Appendix1). Consumer lending program of JSC "Temirbank" - a package of "Honored" to acquire real estate under construction. Term loans - 2 to 15 years. Credit currency tenge. Maximum loan amount - no more than 65% of the appraised value of the property. Method of payment - monthly payments, with interest accrued to the actual debt balance. Downpayment - 35% Consumer lending program of JSC "Temirbank" - a package of "Free-2" for housing. Loan period - from 3 to 20 years. Credit currency - tenge to U.S. dollars. Maximum loan amount - no more than 75% of the appraised value of the property. Method of payment - annuity payments (monthly). Initial payment - from 25% Consumer lending program of JSC "Temirbank" - a package of "Classic" for housing. Loan period - from 3 to 20 years. Credit currency - U.S. dollars. Maximum loan amount - no more than 90% of the appraised value of the property. Method of payment - annuity payments (monthly). Initial payment - from 10% Consumer lending program of JSC "Temirbank" - package "No down payment" on the purchase of housing. Loan period - from 3 to 20 years. Credit currency - tenge to U.S. dollars. Maximum loan amount - 100% of the appraised value of real estate. Method of payment - annuity payments (monthly). The initial fee - is required .
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Education Loans "Temir-STUDENT." JSC Temirbank program offers loans to individuals for tuition. Loans for education, higher education program "Bachelor", "specialist" and "master" full-time education at certified JSC "Financial Centre" of higher education situated in the territory of the Republic of Kazakhstan, received the results of the UNT (Uniform national testing) or comprehensive testing of at least 60 points, 2. in performance during training at the university at least 3.5 points on the results of examinations (on a five-point system), 2.8 (on a four-), 70% (the percentage of the scheme) under a guarantee of JSC "Financial Center" . New NON-SNOP loans (the program "Blitz" program "Start" and the "Business"). Consumer lending program "Blitz." Temirbank program offers loans to individuals for consumption purposes, the discovery of his affairs, business development, the security of housing. Loan term - up to 20 years. The term line of credit expires in three years prior to the release of the borrower's retirement. Credit currency - tenge to U.S. dollars. Provision - residential real estate in the cities of Kazakhstan, the land is not agricultural land. The scheme of redemption - annuity payments (monthly). The initial fee - is required. One of the main types of banking products is to provide loans. Flexible and focused on customer demand credit policy of the Bank contributed to the needs of the real economy, which is reflected in the implementation of construction projects, implementation of trade and trade brokerage, development services, transport, communications, development of small and medium businesses, petrochemical, mining and metallurgical industries, agricultural enterprises, the active development of retail business to meet the needs of the people to acquire housing, transport and basic commodities. Bank's credit policy helps to change the structure of loan products, in particular, has increased the proportion of credit lines, allowing corporate customers to provide financial services such as inventory financing, overdraft, bank guarantee, letter of credit, leasing and factoring. Credit history is the main official document of the Bank evidencing the loan relationship. This is the primary document provided by management, internal and external auditors. The responsibility for keeping the credit file is branch of the Bank. The loan file should contain all the information on credit relations, the appropriate Division staff are responsible for monitoring for its annual review to monitor the completeness and current status. Check the loan documentation and credit review conducted by auditors in accordance with Policy analyzed on the basis of a sudden, what is reported and the
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results of which are transmitted to the Board of Directors, Audit Committee, Credit Committee, the Management Board and Chairman of the Board. The duties of the Committee on the classification of assets is to prepare proposals for writing off loans classified as uncollectible and for which the Bank has established reserves of 100% [29]. Such proposals shall be submitted for approval by the Board of the Bank and the Credit Committee. Writing off bad loans made in accordance with the requirements of normative legal acts of National Bank of Kazakhstan and the Republic of Kazakhstan Agency on Regulation and Supervision of Financial Market and Financial Institutions. Committee on the classification of assets considering the assets classified as loss and for which the Bank has established a reserve of 100% in order to verify compliance of the assets with the following conditions: - Overdue obligations over 180 days; - Delay repayment of principal or interest for more than 90 days or more; - Loss of deposit; - A delay of payment of principal or interest for more than 90 days; - Subject to a general deterioration in the financial situation (increase in accounts receivable, reserves illiquid goods or finished goods); - The announcement of the borrower's insolvency; - Force majeure or other circumstances that have caused financial loss; - The continuation of the ban. In the case of classified assets fall into one of the categories listed above, the Committee on the classification of assets will make a proposal to write off such assets classified as loss, balance sheet of the Bank due to previously established reserves and further reflection in the off-balance sheet. Such a proposal is recorded in the minutes of the meeting of the Committee on the classification of assets and submit to the Board of the Bank. Protocol decision on debt cancellation must include the following information: - The name of the borrower (for legal persons - full name, the form of institution, address, and for individuals - name, surname, patronymic, place of residence); - Date and number of agreements on extradition bank loan and pledge agreement; - Amount of debt written off a loan extended by the accounts; - The number of balance sheet account, report a debt.

Write-off of the extended loan from the balance sheet does not constitute
20

grounds for termination of any of the Bank for collection of debt. Legal Department, the group underwriting and monitoring loans, marketing departments and branches should always watch every debt written off in search of its possible benefits. "Forgiveness" - defined as the consent of the Bank for less than the sum return on the loan than the real debt of the client on all the unpaid loan amount, fees and commissions. Any "forgiveness" of bank claims to U.S. $ 10 000 (principal, interest or fees) to any debtors or guarantor requires the approval of the Committee on problematic loans and debts. In the amount indicated above, requires the approval of the Credit Committee. The Bank's policy provides for the immediate collection / debiting of principal, interest or fees on loans when the loan becomes irrevocable. Nevertheless, with respect to collection of funds must be made in accordance with the regulations of the National Bank of Kazakhstan and the Republic of Kazakhstan Agency on Regulation and Supervision of Financial Market and Financial Institutions. Responsibility for preparing the report, reflecting the problems of the borrower, the measures undertaken to return, the borrower's ability estimate resume normal activities and the reasons for collecting funds rests with the corporate marketing group and the SME and retail marketing group, to represent him before the Board of the Bank and the Credit Committee, through the Chairman Board of Directors. Summarizing to this section must be noted that at the present time, the Bank provides loans to private individuals for consumer purposes, including the purchase of real estate, automobiles, consumer durables, education, treatment, celebrations, holidays, repairs, etc. In addition, The Bank acts as a partner bank in the long-term housing finance program "Kazakhstan Mortgage Company", established by the National Bank of Kazakhstan. To date, Bank signed agreements on mutual cooperation with large mortgages and real estate companies, with years of experience in the field of real estate. The Bank has developed special lending terms: flexible repayment terms of the loan, the minimum initial contribution for projects funded under the pledge of the purchased property, the possibility of early repayment of the loan without paying fines, the minimum period for consideration of applications and issuance of the loan, burdensome requirements for collateral, and a special interest rate on the loan.

21

Chapter 3. Problems and prospects of development of consumer credit in the Republic of Kazakhstan 3.1. Positive and negative aspects of consumer credit in the Republic of Kazakhstan
22

The main problem inherent in consumer lending, a consequence of its main advantages - namely, small consumer loans. To obtain the loan portfolio, which is comparable to the corporate need to issue consumer loans by several orders of more than corporate. And it makes very different demands on the work of the bank and its loan officers in terms of speed and technology. If the corporate loan can be compared to pieces a unique work, the consumer credit has produced a series of mass, which requires a radical change principles of consideration and approval of loan applications. To automate the process necessary to minimize the human factor. Recent studies have shown that, no matter what the consumer credit is often among the most profitable loans that the bank can issue. But banking services aimed at consumers, can also be one of the expensive and risky banking services, as well as the financial situation of individuals can change rapidly due to illness or job loss. Currently, consumer loans are available to individual borrowers by various commercial banks. At the same time one of the main factors influencing the choice of the form of loan agreement and loan conditions include macroeconomic factors (the total economic and political stability, the level of official interest rate NBK, inflation expectations, the purchasing power of tenge, its stability, the development of currency and stock markets, market conditions and loan capital, etc.). and microeconomic factors, acting at the level of the bank and its client (the bank's competitive, experienced by the client and its risks, credit quality, as collateral for loans, whether the customer is a regular customer of the bank, whether it has permanent sources of income, etc.). These and many other factors are taken into account when developing its bank credit policy that defines the loan terms, the level of interest rates charged by other credit terms. Conditions in each case differ little from those given above: the annual interest rate of 18-25% in tenge and mandatory deposit, except for small loans for the purchase of consumer goods, where the key may be the product itself. In general, such a comprehensive range of consumer loans is unique: perhaps even hard to imagine, would have Kazakhstan a few years later the same opportunity to buy anything on credit. The situation suggests two things. First, the credit boom - a clear sign of recovery in the economy and the emergence of the country is very big money. Second, it is better than any statistical evidence of economic and financial stability: if so many agencies doing business on the back of capital willing to give long-term debt, both in SLE and in the Tenge, it means that they trust the financial system and do not expect it any sudden surprises. All this is gratifying. However, we are still dealing with the phenomenon: in a country with a very low-income developing dynamically the most expensive types of consumer loans. Most of the issues is the
23

structure of demand, that is, the number of clients, which now focuses Kazakh lender. Of course, many representatives of the domestic "middle class" with a monthly income of about U.S. $ 400-1000, would not refuse to credit for 3-5 years, 1300020000 in the amount of U.S. dollars for the purchase of, say, a car or a cheap apartment. However, despite the huge selection of offers, such credit to them on acceptable terms, offer a few. Workers rated the service "Express" was conducted a little experiment: ask a car center MERCUR loan to buy a car, explaining that the borrower's monthly income is, say, U.S. $ 800. It turned out, with the income you can count only on loan "VAZ", but does not implement MERCUR on such terms car "VAZ" - they are easily sold at retail. The credit program applies only to German cars. For example, you can buy Volkswagen Passat worth U.S. $ 25 000, but this is your monthly income must be at least 1,500-2,000 U.S. dollars. In the end, of course, found the offer car "VAZ" on the installment plan. But to call them great difficulty (except, perhaps, the bank offers "BTA" and one or two companies working with it). In most cases, or the interest rate is completely absurd - up to 42% per annum, or calculating the loan period was too short - not more than 1 year. A similar experiment with housing loans gave a similar picture. Relatively cheap housing, which costs about 50-100 thousand dollars, almost credited, with the exception that the program of the same "TuranAlema" - "BTA-mortgage." With all the variety of offers auto and mortgage loans as long as "seek" to most client software. The head of estate agency Almaty Real Estate Zuhra Nazarov said most of today's mortgage projects focused on a narrow stratum of people with the highest incomes. [30] Assessing the housing credit market Almaty, Ms. Nazarova said his "lack of transparency and secrecy." In her opinion, this situation is caused by a desire to lenders to protect themselves from unnecessary risks, and some peculiarities of taxation. Banks, mortgage lenders projects, according to Ms. Nazarova, often exhibit this flexibility, as a result of which "even wealthy people can pay at once, prefer to take an apartment on credit." This is a fairly bright feature in the market. However, this is how we see, is changing rapidly. By growing in recent months, the number of proposals outside the sector's most expensive credit can be seen on the market moves in the direction of gradual withdrawal from elitism. Studies of demand for household consumer goods, carried out one of the banks showed that more than 55% of respondents are willing to buy on credit a modern household appliances - washing machines, refrigerators, TV sets. The same bank, "BTA", who undertook to develop the most "popular" niche market, said strong
24

demand for all consumer credit products aimed at relatively small (1-10 thousand USD) amounts. "The market will expand, - says head of retail lending BTA Saul Isin. - All commercial banks in Kazakhstan are now shifting from corporate to retail businesses. Because the market is already saturated with bank work with corporate clients, we are increasingly turn to retail. In this regard, there is a recovery in the retail lending market. Now there is an intensive search for mechanisms of investment capital, so banks are working with individuals seeking to expand its customer base. A big role in winning sympathy of the population is competition between lenders, in particular, are among the banks has been a tendency to lower interest rates. Market adapts to low purchasing power, creating effective mechanisms for redistribution to private savings. The main obstacle, which forces us, in many cases, to some unpopular client conditions - high risk "[31, p.24]. As we see, in spite of the vast and rapidly growing supply in Kazakhstan is a large untapped demand for consumer loans. For a variety of positions, supply and demand are not joined. Obviously, the market is just beginning to move to meet existing demand. In this way, there are serious traps and pitfalls. One of the major problems in obtaining credit - guarantees to the bank. Making any sufficiently large loan, you will inevitably face the problem of collateral. They should be your home, car, jewelry, expensive home appliances. The problem is not so much that is not always value, equivalent to the cost of the required amount, there will be a customer, but in the fact that in the event of default of some portion of the amount he loses everything. If you take out a loan with a trading firm that implements a commodity (a car or an apartment), the security of the this product, you are underpaid in period of, say, 15-20% of the total, again risk losing all purchase . Neither company engaged in residential lending, not will issue a complete alienation of property purchased an apartment or house to pay the entire loan amount. And since housing loan - this phenomenon is very extended in time, there is always a danger of any force majeure: bankruptcy, loan closing company. While such moments are usually stipulated in the contract, lack of full ownership rights to payment of the entire loan amount is also fraught with loss and acquisition of all attached to him for money. For example, in bankruptcy proceedings can begin selling the company's property, and none of its credit agreements you are not a guarantee that the court decides in your favor. The risks banks are in bad loans, collateral value mismatch volume of credit, low income stability in the republic. As acknowledged by the bankers, with a
25

noticeable increase in the volume of transactions with individuals they are concerned about the lack of credit history - documents, reflecting the individual's payment for previous loans. Analysis of these data in the world is a mandatory attribute of the banks with individuals. Another problem associated with the presence of undeclared money in circulation, paid employees of individual companies in the form of so-called "black cash". Salary, not reflected in accounting documents, you can spend, but it can not provide the bank as proof of your ability to pay. It is common knowledge that employers engage in payday "black cash" is not a good life: to conduct doubleentry bookkeeping to force draconian progressive tax rates. With the salary of 10 thousand tenge income tax is about 1.5 thousand, and a salary of 50 thousand - is about 14 thousand if the citizen earns in a month 500, 700, 1000 U.S. dollars, tax revenues could reach half income, and even more. That's why many employers use for this category of workers "gray" schemes double-entry bookkeeping. But it is the people with incomes of U.S. $ 500 and above - the "zone of special attention" banks, namely for this category of citizens designed the majority of consumer credit. No bank will go on, say, the provision of mortgage credit to those who presented a certificate of wages in the 100-150 U.S. dollars, much he actually received in the form of a "black cash". Returning to the question of why a country with a relatively low standard of living demanded the most expensive types of consumer loans (ie, the elite mortgage). Some analysts attribute this situation to the legalization of shadow capital by obtaining and repayment of the loan. Of course, it would be an absolute wrong that opinion. However, the general lack of development of consumer lending in Kazakhstan, the imbalance of supply and demand, and in particular the closure of an elite segment of the market suggests the question of why the market is so "picky". Why, in particular, housing loans, which are much more expensive in Kazakhstan and is much shorter in duration, than in Russia, while not seeking to become "more democratic". Realtors and bankers agree that the normal development of this segment is objectively constrained in Kazakhstan by the same reasons that the banking and capital - the lack of "long" cheap money and the imperfection of the legislative regulations, including tax nuances. However, few people spoke openly about the internal situation in the market of housing loans. Meanwhile, it is characterized by an unprecedented revival. Only in Almaty today are based on credit scores of mansions and luxury residential areas. Based on some confidential assessments, we have built a number of schemes a legitimate legalization of capital that can be used in the design of housing loans. Here is one of such schemes. Making your loan to build a shareholding - a loan is
26

obtained - construction done - credit returned. Under the current law is not declared the source of funds that went into the back of credit for housing with equity participation. Thus, the money that paid for the credit, legalized. In general, "the flip side" of the credit market suggests that, despite the extensive offer, he still in Kazakhstan "raw", not fully structured and not very civilized. But we can see how it goes, saturation spreads offer a growing selection. There were whole real estate companies that specialize only in selling housing loans. Pages advertising newspaper ads orgy of various loans, mortgages, finlizinge. All of this suggests the presence in the market a lot of money that need to be back. If you carefully analyze the situation on the domestic financial market, it becomes clear that the niches in the banking market is not so much. Consumer lending remains essentially undeveloped "niche" where the rate of 18-25% yield a considerable profit, and the market consisting of millions of consumers, is fraught with huge potential. It is though not the fastest, but rather a reliable mechanism for the turnover of capital. Finally, another motive for enhancing inside of Kazakhstan credit market, some experts believe the global financial trends. We are talking about the perceived bankers term dollar decline: they understand what "hot" money to get rid of, forcing them to work in the lucrative business, in any case, what is the lending of 20-25% per year. Kazakhstan's market of consumer lending for a few years behind the Russian. There's the business began to grow in 1992-1993 in the metropolitan areas of the familiar "elitist" way, and today enjoys a large consumer credit percentage of the population is not only large centers, but also of the province. The strategy was originally based Russian lenders on extensive research of consumer demand. In particular, after a number of monitors in a Moscow bank "Russian Standard" came to the conclusion that in Russia there are about forty million people whose income is between one hundred to one thousand dollars a month. Almost a quarter of the population - this is a huge market, due to which banking capital in Russia has considerably increased the opportunities for effective attachment. This market, which today looks much more "democratic" as Kazakhstan on the structure of demand, and under the terms of the proposal. Take the most "popular" niche consumer goods. Several Moscow banks under contracts with the local hardware store loans to their clients in the following way. Size - up to 30 thousand rubles (about U.S. $ 1,000), a down payment - 20% of the price, the reward - 10%, duration - up to six months. The most fundamental difference between the practice of domestic banks - what a buyer for the loan only fills in the questionnaire. No other documents (income statement or a copy of the work book) is not required. Look very democratic options of loans for private purposes. In the Russian provinces, as well as in Kazakhstan, incomes are low, but, say, in Russia, you can
27

get a loan, even earning below U.S. $ 50 per month. Interest rates do not exceed 10-12% per annum, the maximum term - five years. True, the "ceiling" amount of such credit is low - only about 250 U.S. dollars, but this villager and some serious money. Finally, mortgage and auto loans in Russia are also more favorable conditions for the consumer and do not look so elitist, as in Kazakhstan. The interest rates of mortgages advertised in Moscow, did not exceed 15-16%, the credits may be granted even for 10 years. Along with the standard loan products, Russian banks in the last three years of her private clientele, offering some special services. They are designed for a relatively small but rapidly growing category of people pushing for banking services the highest demands. This is a "sensitive" species credit to the private business brokerage services to work in the stock market. Last "by definition" is not yet available to domestic banks, as the stock market in the country practically does not work. Even a cursory glance is enough to understand that the Russian consumer finance market during its existence is seriously close to world standards. But the question is: what prevents lenders if they are interested in expanding their benefits today to make their services more accessible? At him in domestic banks respond unequivocally: the risks. Time limits loan repayment strict conditions on its collateral, higher than Russia's, interest rates, high qualification of client's income - in all this is read as the desire of banks to protect themselves from losses in the non-return of borrowed money. In turn, this turns into legal traps for customers. The question of what to do here is just as relevant as it is complex. Obviously, the output is in a certain balance of policy and policy banks. Need to improve the legal framework, especially the tax in order to make loans more accessible to the masses of the population. And to think seriously about the stock market. Further saturation of the economy with money while maintaining the current situation poses a threat to its overheating and even inflationary collapse [32]. Analysis of the lending practices of individual customers in Kazakhstan led to several conclusions. First of all, the current practice of lending to households by various commercial banks have a number of characteristics inherent in the initial stage of development of consumer lending in Kazakhstan. As a consequence of the relatively new practice of lending to individuals is replete with problems. The latter include: - Shortcomings lending process; - Use of cash in the issuance and repayment of the loan; - The lack of economically viable interest rate policy; - Problems of a legislative nature; - A relatively narrow range of types of consumer loans.
28

The market analysis conducted in terms of income levels, purchasing power, availability of banking institutions in the regional context, showed that the issue of lending to households in Kazakhstan is very acute. The banks bear the brunt of the different risks: the risk of a sharp depreciation of the securities received in security for a loan, the death of the customer's property as a result of a natural disaster, etc., of fraud by the borrower, the last departure from the residence to an unknown destination, his death and transfer of debt to relatives of the deceased, etc. However, an important characteristic of the current state of the credit market is the ability to provide greater repayment of consumer loans than loans to businesses and organizations. The study showed that the modern Kazakh practice of lending to individuals for consumer demands the improvement both in terms of expansion of facilities lending, and differentiation of the conditions for granting loans.

3.2. Improving the organization of consumer credit in the Republic of Kazakhstan Macroeconomic stabilization as a whole, and overcoming inflation, in particular, also enable people to make greater use of bank loans for the solution of vital problems. All this points to the need for further development and improvement of credit relations with commercial banks on the basis of a population study of domestic and foreign experience. From our point of view, it is necessary to develop comprehensive banking services to the population, giving the latter a wide range of banking products and services, increasing revenue, creating a resource base of the bank, extend credit relations with the public. Further development and improvement of credit relations of banks with a population of possible and feasible to implement on the basis of the study and implementation in practice of advanced domestic and foreign experience. Using the experience of other countries in the field of private lending can go on as they gain experience in commercial banks lending, strengthening the material-technical base, providing the necessary staff, on several fronts: - Improving the use and implementation of new types of loans; - Improving the quality of banking services; - Differentiation of the conditions for granting loans, depending on the type of loan, the validity period, the borrower's income level, etc.; - Of the order of registration and use of credit, etc. Further improvement in the organization of individual borrowers credit requires the solution of problems. Consumer loans are currently issued, not only
29

lending institutions but also enterprises and organizations, which are not inherent in credit functions. In addition, consumer lending needs of the community organizations has been hindered by many many issues. For example, there is no planning for consumer loans in the whole country and for individual regions. In the credit plan of banks provided only loans issued by them. Difficult to study the prospects for further development of consumer credit, the harmonization of conditions of use. Issuance and repayment of loans not linked to the performance balance of money incomes and expenditures. The above confirms the necessity of concentrating the issuance of all types of consumer loans in the banking system. It seems reasonable to significantly expand the list of loans provided to clients in education, to organize their own business, as well as provide various services, including informing customers about the programs for encouraging investment and entrepreneurship. In addition, the positive effect of individual borrowers credit would also: - The introduction of targeted housing construction and provision of inputs on this basis, the priority right to obtain an investment loan depositors after compliance with the established conditions are met: the retention period and the required amount of the accumulation of funds on deposit; - Conducting market research to identify the banks of the population needs for new kinds of loans; - Raising awareness of private bank customers about new kinds of loans and banking services; - Best interests of the client's individual approach to lending. The development of credit relations with banks of the population - an issue not only economic but also political and social. In addition to the necessary economic and political stability, development, commercial banks, communityoriented monetary policy in relations with the public, it also requires a modernization of the forms and lending practices, improved interest-rate policy and the conditions for granting and repayment of loans, the experience of foreign countries with market economies. Improving consumer lending in the face of rising interbank competition is an important factor for the bank, to strengthen its public image, attraction and revenue base. These properties provide consumer credit increasing attention to it. Thus, when working with a large number of individual borrowers' ability to pay them should be viewed only on the basis of the official current income, averaged over a sufficiently long period of time. It is also necessary to pay great attention to the stability of income and the probability of change in the future. The last refers,
30

in particular, to pay and a stable work of the company, listing the salaries of the potential borrower to the bank.

CONCLUSION To date, the program includes retail lending fees, repair of motor vehicles, housing, medical, educational, tourist services, for celebrations, as well as meet the
31

immediate needs which are not related to business activities. In addition to these loans for sale to the loan connect more and more segments of consumer products, from furniture to cell phones. Almost all of the top ten banks announced the creation of their own programs lending to individuals. This is due to the growth of household deposits in banks. Creating a deposit guarantee system, the general welfare has led to the banks rather large financial resources. In recent years, consumer lending refers to the category of the most popular financial services provided by banks. Today, the consumer lending market in Kazakhstan is experiencing significant growth. This type of loan helps the bank diversify its customer base to attract deposits and to find revenue sources to complement and compensate for the risk of lending and deposit business firms. Indeed, in recent years, many banks are paying increasing attention to consumer lending in order to avoid or mitigate the impact of economic cycles, leading to a periodic decrease in the volume of traditional bank lending to business and to avoid intense competition from foreign banks. Despite this, consumer credit has significant disadvantages in terms of the bankers. The percentage of bad loans of this kind are usually higher than for other types of bank loans, although gross earnings on them are also much higher. Key factors in the provision of quality consumer credit act and the character of the borrower's responsibility. The bank can evaluate them by analyzing the borrower's credit history, which can usually be obtained from a credit bureau. The value of the credit bureaus is extremely large, their existence allows credit institutions to grant loans to customers who had previously not serviced by the bank. In addition, the generally accepted value is the previous credit history to predict the likelihood of default. The study showed that the modern Kazakh practice of lending to individuals for consumer demands the improvement both in terms of expansion of facilities lending, and differentiation of the conditions for granting loans. From my point of view, it is necessary to develop comprehensive banking services to the population, giving the latter a wide range of banking products and services, increasing revenue, creating a resource base of the bank, extend credit relations with the public. Macroeconomic stabilization as a whole, and overcoming inflation, in particular, also enable people to make greater use of bank loans for the solution of vital problems. All this points to the need for further development and improvement of credit relations with commercial banks on the basis of a population study of domestic and foreign experience.

32

However, the analysis of individual credit worthiness of individuals is important to carefully use credit scoring method, especially since the issuance of long-term loans to the situation during the execution of loan agreement varies and can be a serious risk of default on the loan. Work to minimize credit risk Kazakh commercial banks is constructed similarly to the approach adopted in the developed Western countries. Credit risk management involves an analysis of each loan and the bank's loan portfolio as a whole. At the present time in our country some practice assessing the creditworthiness of a client there, but basically it is a mere formality (documentary) character. Work to analyze the creditworthiness of the individual precedes the conclusion of his loan agreement and allows us to determine the risks that could lead to outstanding loans in due time, and assess the likelihood of its timely return. An informal analysis of the creditworthiness of individual customers is used only rarely. Vigilance is the rapid growth of lending in the banking system, the rate of which increased in 2006, almost twice as compared to 70% per year on average over the previous five years. The high growth rates probably continue in 20072008. - Especially in the fast-growing retail segment of the banking sector. Despite these successes, the credit rating of banks in Kazakhstan continue to hamper such factors as lack of transparency of ownership structure in need of restructuring the corporate sector, the rapid credit growth, a high concentration of loans to individual borrowers and sectors, as well as a large proportion of lending in foreign currency . All of these factors expose the bank to risk destabilizing the economy, interest rates and exchange rates. Troubling, too, the increasing expansion of the domestic banks in other markets of CIS countries with higher levels of risk, mainly in Russia. In Kazakhstan, created LLC "First Credit Bureau" in August 2004 on the initiative of the Association of Financiers of Kazakhstan (ROS). The main activities of the credit bureau is to create a credit history of borrowers and providing reports to creditors. Legal basis for the establishment of the Kazakhstan Institute of the financial market infrastructure has been enshrined in the Law "On Credit Bureaus and the formation of credit histories." According to the FSA in 2007 2008yy. expected a boom in consumer credit, so the number of defaulters could grow from 1 to 5 percent. Here, it was then and will need expert help to recover debts, the so-called collection agencies. The advantage of this option - to save money for the services of debt collection companies, as well as in relative control of the progress of the work our employees. The lack of special training, experience, flexibility and freedom to make decisions and the lack
33

of direct material interest in a refund, eventually leads to inefficient results of operations of the bank staff. Thus, one of the most important tasks of domestic banks at the stage of development is the creation and implementation of banking technology, which allows the profitable business with the optimal degree of care that best meets the interests of national economy. The cornerstone of a successful banking business should be a rational lending policies and credit culture, as in the current economic conditions, the value of the loan business for banks will increase.

List of used literature

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1 The Law "On Banks and Banking Activity in the ROK," 1995. (As amended in 2007). 2 of the Act of March 30, 1995 2155 "On the National Bank of the Republic of Kazakhstan" (amended 2005). 3 The Law of the Republic of Kazakhstan dated 06.07.2004 N 573-2 "The credit bureaus and the formation of credit histories in the Republic of Kazakhstan" 4 Resolution of the Board of the Agency on Regulation and Supervision of Financial Market and Financial Institutions dated 30 September 2005. 358 5 Rules of the conditions and minimum requirements for the provision of information providers information on the procedure of registration of subjects of credit agreement for the provision of information about them to the credit bureaus, registration agreement for the grant of a credit report and on the conditions and procedure for granting a credit report dated August 21, 2004 N 250 6, "Money Loan Banks' / ed. Seytkasymova GS - A.: Economy, 1999god 7 Banking / ed. OI Lavrushina .- Moscow: Finances and Statistics, 1998god 8 Journal "Banks of Kazakhstan March 2004 9 Garbuzov, AK The financial and credit Dictionary, Volume II. Moscow, Finance and Statistics, 1986 10 Lavrushina, O. Organization and planning of the loan. Moscow, Finance and Statistics, 1991 Lipsits 11, IV Economy without secrets. Moscow, Delo LTD, 2003 12 Kapalin KA "Buying on the installment plan" Banks of Kazakhstan 11, 2006 13 Dolan EJ. Campbell RJ. "Money, banking and monetary policy" - Moscow Leningrad, 1991 14 Travkin AA Methods of Enforcement of loan commitments / AA Travkin, N.
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Aref'eva, KI Karabanov; Volgogr. state. Univ. - Volgograd, 2005. 15 AI Achkasov active operations of commercial banks / Ed. A. Nosko. Konsaltbankir, 2004. 16 Mc Naughton D. Banking institutions in developing countries / / Volume 1: Strengthened leadership and sensitivity to change. World Bank, 2000. 17 Chatskis, ED Explanatory Dictionary of the financial - accounting terms and concepts. A: "Stalker", 1996 18 Gol'tsberg, MA Hassan-Beck, LM Crediting. Per. from English. Kiev, trade publishing office VHV, 1994 19 Peter Rose, "Bank Management", 1995. 20 K. Schiborsch Consumer credit: the Western experience and development prospects in Russia / / Banking Technologies, 9, 2000 21 Shirinskaya EB Operations of commercial banks and foreign experience Moscow: Finances and Statistics, 1993; 22 popes, GS "The credit policy of commercial bank" - Moscow, 1997 23 Dolan EJ. Campbell RJ. "Money, banking and monetary policy" - Moscow Leningrad, 1991 24 Heh, Oleg People's Bank increases the volume of consumer lending / / Panorama, 48, December 14, 2001. 25 Report of the National Bank of Kazakhstan on the state of the banking sector of RK in 2006 26 I. Advantages of electronic Akimov queue \ \ World of Finance 2, 2007. 27 Credit Policy of JSC "Temir Bank", 2007. 28 GS Seytkasimov Accounting and reporting in the bank. A., 2005.
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29 Resolution of the Board of the National Bank of Kazakhstan "On Approval of Regulations for the classification of assets, contingent liabilities and the creation of provisions (reserves) against them, with the assignment to the category of doubtful and loss" on November 16, 2002 465 from 01.09.2004, the changes in the 30 Nazarov AZ Real Estate for people with high incomes. www.expert.ru, 2007

Appendix 1 Consumer lending program of JSC "Temirbank" - a package of "Youth"

37

Specific applications. Currency of the loan Credit period Maximum amount Provision The initial contribution The method of repayment Early repayment Fee for application Commission for the organization of credit Fee for cashing Insurance

Purchase of housing Tenge From 20 to 30 years no more than 95% of the appraised value of real estate Acquired property, additional collateral 5% annuity payments (monthly) minimum amount of repayment 200 000 tenge 2500 T 30000T 0.5% of loan amount Property insurance collateral Borrower's insurance against accident Insurance purity of title The Republic of Kazakhstan From 18 to 35 years at least 6 months Individuals, consistently receiving wages, which the evidence on the basis of SCPP up to 5 working days

Citizenship of the borrower Age of the borrower Work Experience of the borrower Employment Type of the borrower

Turnaround time credit

Appendix 2 Financial statement of Temir Bank Assets Cash and cash equivalents 2009 8 540,6 2010 26 685,8
38

(KZT TG) Change 212%

Securities Amounts due from credit Institutions Loans to customers Deferred income tax Other assets Total assets

12 752,8 891,6

32 031,5 655,5

151% (26)%

197 286,1 3 801,1 3 233,6 226 505,8

166 935,6 13 100,9 4 589,3 243 998,6

(15)% 245% 42% 8%

STATEMENT OF FINANCIAL POSITION as of December 31, 2010 In thousand of Tenges December 31, 2010 Assets Cash and cash equivalents 26.685.768 Trading securities 23.800.278 Amounts due from credit institutions 655.498 Loans to customers 166.935.617 Derivative financial instruments 157.383 Investment securities : -held-to-maturity 8.231.246 Current income tax assets 41.329 Deferred income tax assets 13.059.557 Property Mid equipment 1.324.204 Other assets 3.107.681 Total assets 243.998.561 Liabilities Amounts due to credit institutions 10.589.522 Amounts due to customers 130.493.261 Eurobonds issued 8.784.286 Debt securities issued 37.882.862 Derivative financial instruments Other liabilities 635.985 Total liabilities 188.385.916 Equity Common stock 59.183.173

39