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Standard & Poor's Ratings Services lowered its long- and short-term foreign and local currency issuer credit ratings on sovereign wealth fund and joint stock company Samruk-Kazyna to 'BBB-/A-3' from 'BBB/A-2'. The outlook is negative, the agency said Feb. 25.

S&P also lowered our Kazakhstan national scale rating on the company to 'kzAA' from 'kzAA+'.

At the same time, S&P lowered our ratings on Samruk-Kazyna's senior unsecured debt to 'BBB-' from 'BBB'.

The downgrade follows a similar action on the sovereign, the statement said.

S&P base ratings on Samruk-Kazyna on opinion of its status as a government-related entity (GRE) with an almost certain likelihood of receiving extraordinary support from the government in the event of financial difficulties. Accordingly, we equalize our ratings on Samruk-Kazyna with those on Kazakhstan.

The negative outlook mirrors that on the long-term sovereign credit ratings on Kazakhstan, the statement said.

S&P could lower the ratings on Samruk-Kazyna if we perceived any signs of weakening sovereign support--for example, Samruk-Kazyna deviating from its policy role or changes to how the government manages its assets--which lead us to negatively reassess Samruk-Kazyna's role for and link with the government, or if we lowered our sovereign rating on Kazakhstan.

S&P would revise the outlook to stable if we were to revise our outlook on the sovereign to stable.

Samruk-Kazyna National Welfare Fund brings together almost all of Kazakh state-owned assets and manages these assets on behalf of the government. KazMunaiGas NC JSC, the railway operator - Kazakhstan Temir Zholy JSC, Kazakhstan Electricity Grid Operating Company JSC (KEGOC), Kazakhtelecom JSC telecommunications operator, National Atomic Company “Kazatomprom” JSC are among these assets.

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