Banking
From The Report: Kuwait 2013
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Despite a variety of ongoing challenges, Kuwait’s banking sector has performed well in recent years. The country’s 10 local banks and 11 foreign players make up one of the oldest banking sectors in the region and the third largest in the GCC. In the wake of the global financial crisis, the Central Bank of Kuwait (CBK) has introduced a raft of new regulations. Although these are likely to have a negative impact on profits in the short-term, they are expected to support sector growth in the long term. This chapter contains an interview with Mohammad Y Al Hashel, Governor, Central Bank of Kuwait.

Articles from this Chapter

Overview

Strength in numbers: After years of provisioning, the sector is poised for expansion
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Despite a variety of ongoing challenges, Kuwait’s banking sector has performed well in recent years. The country’s 10 local banks and 11 foreign players make up one of the oldest banking sectors in the region and the third-largest in the GCC, with total assets of KD48.8bn ($174.3bn) at the end of March 2013. In 2012 the industry saw asset growth of around 11%, profit growth of around 3% and, perhaps most importantly, a 5% jump in lending, the highest expansion of credit issuance since 2009.…

Interview

OBG talks to Mohammad Y Al Hashel, Governor, Central Bank of Kuwait (CBK)
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Interview:Mohammad Y Al Hashel What lessons from the financial crisis have shaped the CBK’s current position, and what will be the priorities for the bank moving forward? MOHAMMAD AL HASHEL: The CBK, like regulatory bodies worldwide, has taken away important lessons from the financial crisis. First, regulators must remain vigilant and focus on regulating banks with a long-term approach. Second, regulators need to focus on systemic exposures rather than just ensuring the health of individual…

Analysis

Focus on lending: Credit issuance shows promising signs of recovery
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Despite the challenging economic environment and ongoing slow demand for credit in the region, Kuwait’s banks saw a slight increase in loan issuance over the course of 2012. According to data from the National Bank of Kuwait (NBK) – the country’s largest bank by assets – by the end of 2012 credit growth had risen by around 5% year-on-year, up from around 1.6% over the course of 2011 and just 0.4% in 2010. This increase, while slight, was widely considered to be a signal of the sector’s…

Analysis

Remote assets: Revenues from a handful of far-flung markets are on the rise
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In recent years, Kuwait-based banks have faced a number of challenges, including a conservative regulatory environment and relatively slow economic expansion since the international financial downturn. With this in mind, and in an effort to shore up long-term growth prospects, many local financial institutions have invested heavily in international markets over the past few years. “A number of banks have been expanding internationally,” said Hamad Ali Al Hasawi, the secretary general of the…

Analysis

Financing opportunities: The state’s infrastructure investment programme could be a boon for the sector
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After half a decade of strong provisioning, cautious credit management and, in some cases, debt restructuring, Kuwait’s banking sector is in a relatively strong financial position. As of the end of 2012 the country’s 10 local banks boasted total assets of KD47.3bn ($168.9bn), up from KD44.1bn ($157.5bn) at the end of 2011 and KD41.4bn ($147.9bn) at the end of 2010. While most institutions have maintained a fairly conservative approach since the 2007-08 international financial downturn, lending…