approximately 1 in 11 banks experienced at least one episode of distress each year.<sup>s</sup> The cumulative expenditures are 5.6 trillion Kazakh tenge (simple sum), which corresponds to 8.4 percent of the cumulative share of tax revenues (Figure A1 panel B), and about 11.5 percent of the country’s gross domestic product over the period 2009-2020 (Figure A1, panel A, in the annex).

**Table 1: Overview of the dependent variables employed in the analysis**

|**Variable**|**2009**|**2010**|**2011**|**2012**|**2013**|**2014**|**2015**|**2016**|**2017**|**2018**|**2019**|**2020**|**2021**|**Total**|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|**Distress (#)**|||||||||||||||
|No event|32|36|38|38|37|37|34|33|26|27|27|24|22|411|
|Event|5|2|1|0|1|1|4|2|7|5|1|3|4|36|
|Total|37|38|39|38|38|38|38|35|33|32|28|27|26|447|
|**Resolution (#)**|||||||||||||||
|Operating|18|20|21|21|20|20|17|16|9|10|10|7|5|194|
|Private/Market|1|1|1|0|0|0|3|2|1|3|0|1|4|17|
|Bail-out|4|1|0|0|1|1|1|0|6|2|1|2|0|19|
|Total|23|22|22|21|21|21|21|18|16|15|11|10|9|230|
|**Cost (KZT**<br>**billion)**|||||||||||||||
|Cost|332|24|0|0|0|220|250|0|3294|550|604|296|0||
|Cumulative|332|356|356|356|356|576|826|826|4120|4670|5274|5570|5570||
|Cost as % of<br>GDP|2%|0%|0%|0%|0%|1%|1%|0%|6%|1%|1%|0%|0%||
|Cost as % of<br>tax revenue|15%|1%|0%|0%|0%|4%|5%|0%|48%|7%|7%|4%|0%||

_Source_ : Own elaboration using data from the National Bank of Kazakhstan and audited financial statements of the banks supplemented with news reports. The total number of banks as of the start of the calendar year. _Note_ : The variable distress is computed considering all banks in the sample. We define an event as a bank-year observation where a bank is subject either to government intervention or private/market resolution of distress. The variable resolution is computed considering banks in the sample that have been subjected at least once to a resolution event over the period 2009-2021. The category operating refers to bank-year observations where a bank is not subject to an event in a specific year. Private resolution refers to bank-year observations where a bank is subject either to liquidation, merger, or reorganization in a specific year. The category bail-out captures bank-year observations where a bank is subject to government intervention in a specific year. The variable cost captures government expenditures related to bank bailouts.

# _4.3 Ownership type, systemic importance, and other control variables_

We are interested in analyzing how the ownership type and systemic importance affect the likelihood of distress, the use of specific resolution tools, and the associated fiscal expenditures. Because of the small sample size and the need to populate each category of ownership type over time, we select a parsimonious set of ownership types. Namely, if a bank is owned with a stake that is greater than 50 percent and ultimate operational control: (1) by private local shareholders or with the largest stake and operational control over the bank, the bank is classified as “ _private local_ ”; (2) by a restricted number of shareholders connected to PEP family, the bank is classified s Note that if a bank experienced multiple events of distress in one year, it is just counted once. Therefore, although 41 events of resolution happened during 2009-2021, just 36 are reported in Table 2.

13