Kuwait

#Kuwait's Warba Bank part of IDB's USD 1.2 billion venture

Warba Bank announced that it will be partaking in a USD 1.25 billion five-year joint venture with the Islamic Development Bank (IDB). Warba Bank said that subscription for the deal had attracted regional and international financial institutions. The amount of issued bonds reached over 136%, around USD 1.7 billion. Warba Bank indicated that it would reap around 2.6% of annual income due to the deal. The IDB issued around 53% of the bonds to investors from the MENA region and Europe, while 47% of the bonds target investors from Asia.

KIA appoints consultant to study possible #merger of KFH and AUB – Tie-up will make KFH the largest bank in #Kuwait: Moody's

Kuwait Investment Authority has appointed a global consultant to study the merger of two banks, Kuwait Finance House (KFH) and Ahli United Bank (AUB). Moody’s said in a report that the merger of the two banks will have a positive impact on credit rating, especially for KFH. Moody’s noted that if the merger is successful, it will create the sixth largest bank in the GCC with nearly $85 billion in total assets. The merger will make KFH the largest bank in Kuwait, but it will remain the second largest bank in the Gulf after Al-Rajhi Bank Saudi Arabia. The number of domestic branches of KFH reached 65 while AUB has 37 branches. Several reports were published on the possible merger of the two banks. However, officials from both banks denied reports on the merger while others confirmed.

#IIRA Maintains #Ratings of #Kuveyt #Turk Participation Bank

The ratings on Kuveyt Turk Participation Bank continue to reflect its overall sound risk profile. IIRA’s assessment on Kuveyt Turk Participation Bank encompasses sponsor support from its key shareholders that include Kuwait Finance House, Islamic Development Bank and other quasi-sovereign entities such as the General Directorate of Foundations – Turkey and Kuwait Public Institution for Social Security.

KFH is planning #expansion in #China

Kuwait Finance House (KFH) is considering expanding into China and Egypt as the region’s banking sector nears saturation. According to bank's CEO, Mazin Saad al-Nahedh, there are opportunities for a Kuwaiti bank to operate in China. He added that the bank was looking at options to buy a license to operate in Egypt as well. KFH is cautiously optimistic about its operations in Turkey. Its subsidiary Kuveyt Turk contributes 22% to the group’s bottom line as of the end of June. The bank expects credit growth of no less than 20% to 25% over the next three to four years as long as base rates remain where they are. As KFH continues its restructuring and sale of non-core assets, the bank is studying offers for its stake in Aref Investment Group, which it aims to sell by the end of the year. KFH is also planning to buy Bahrain’s Ahli United Bank, but hasn't started negotiations yet.

KFH will benefit overall from #merger with Ahli United Bank – Transaction to create 6th largest bank in GCC

Kuwait Finance House (KFH) disclosed that it is studying a merger with Bahrain-based Ahli United Bank. Although the merger would present significant integration challenges owing to the banks’ geographically dispersed asset bases, it would be credit positive for KFH. If successfully completed, the transaction would create the sixth-largest bank in the Gulf Cooperation Council (GCC), with approximately $85 billion in total assets as of year-end 2016. The merger is at an early stage of evaluation, with financial analysis underway. The merger would expand KFH’s banking operations, which are primarily focused in Kuwait and Turkey, and include relatively small operations in Malaysia and Bahrain. In addition to Bahrain, AUB has principal subsidiaries in the UK, Kuwait, Iraq, and Egypt, and has an associate in Oman.

Kuwait Finance House studying #merger with Ahli United Bank

Kuwait Finance House (KFH) is looking to merge with Bahrain's Ahli United Bank. The Gulf's banking sector is in consolidation as three years of low oil prices squeeze deposits and push up bad loans. KFH Chief Executive Mazin Al-Nahedh said the merger was currently only under study and there has been no agreement so far. In other regional bank mergers, First Abu Dhabi Bank was recently created in the United Arab Emirates after a tie-up between two Abu Dhabi lenders, while mergers are under way in Qatar and Saudi Arabia. KFH said in the statement that it was looking at a range of alternatives to boost its profitability, adding that such decisions require approval from regulators, including the central bank.

Warba Bank ‘signs’ financial deal with #Turkey’s Ziraat Bank – Islamic banking sector growth eyed

#Kuwait’s Warba Bank announced a new Shari’ah-compliant, joint, multi-currency financial deal of $236 million with the Ziraat Participation Bank of Turkey. Warba Bank acted as the Lead Arranger and Subscription Manager of the deal, which was initially launched at $160 million. Due to oversubscription, the deal was increased so as to reach $ 236 million, with an increase of 52%. The Murabaha-based financing deal includes both US Dollars and Euros. It will be employed mainly in SME financing and income diversification at Ziraat Bank. Shaheen Hamad Al-Ghanem, Warba Bank’s CEO said the Bank was proud to be entrusted and to contribute to the financing of the agricultural sector, which is one of the pillars of the rise of the Turkish economy. This is the second participation of Warba Bank in arranging a financing transaction for the Ziraat Participation Bank of Turkey. In 2016, it contributed to a $155 million multi-currency co-financing transaction for the Turkish bank.

#Kuwait’s Islamic finance sector on strong growth trajectory, IMF says

According to a recent study by the International Monetary Fund (IMF), Kuwait’s Islamic financial services sector is growing rapidly, with Islamic banking emerging as the most developed component of the industry. Islamic banks’ market share increased rapidly between 2005 and 2010 and has since then stabilised at around 38%. Kuwait’s Islamic banking sector includes systemically important banks. The largest Islamic bank in Kuwait accounts for 23% of total banking system assets, over 70% of the Islamic banking assets. The capital adequacy ratio and Tier-1 capital remain above 15%. The IMF report notes that the economic diversification effort could help drive further growth in Kuwait’s Islamic banking industry.

KFH Said in Talks for #Bahrain Ahli United Bank, Kuwait Unit

Kuwait Finance House is in talks to buy Bahrain’s Ahli United Bank in a deal that would create one of the Middle East’s largest Islamic lenders with $85 billion of assets. However, there is no guarantee that a deal will take place and final agreements haven’t been reached yet. Lower oil prices are forcing Gulf lenders to consolidate for scale. Abu Dhabi lenders National Bank of Abu Dhabi and First Gulf Bank recently merged to create a regional powerhouse with $175 billion of assets. Qatar’s Masraf Al Rayan is planning to combine with unlisted Barwa Bank and International Bank of Qatar to create the country’s largest Islamic lender. Ahli United in Bahrain declined to comment. KFH shares have lost 0.6% so far this year, giving the lender a market value of $9.3 billion. Ahli United shares have jumped 16% so far this year, giving it a $5.57 billion market capitalization.

#Kuwait's Noor to Weigh Stake Sale of #Pakistan's Meezan Bank

#Kuwait’s Noor Financial Investment is considering the sale of its 49% stake in Pakistan’s largest Islamic lender Meezan Bank. The stake has a market value of about $396 million at the current market price, according to data compiled by Bloomberg. Noor Financial hired advisers to assess opportunities, but it has not tasked the consultants with either increasing or decreasing its stake in Meezan Bank. Shares in Noor Financial gained 5.9% by 12:30 p.m. in Safat, Kuwait, the highest since April 16. Meezan advanced 3.6% in Karachi trading to a record high.

BRIEF-Kuwait Finance House denies any decision to merge with Ahli United Bank

Kuwait Finance House denies any decision to merge with Ahli United Bank. Kuwait Finance House is currently studying many other strategic alternatives to enlarge its profitability and marketshare among local and regional banks.

CBK to implement Sharia governance by year-end – To be applied to all banks

The Central Bank of #Kuwait (CBK) is determined to develop the financial sector’s workforce and plans to introduce Sharia governance by the end of the year. CBK’s Inspection Department Chairman Waleed Al-Awadhi revealed that Sharia governance will be implemented after consultations with local banks and will be applied to all Kuwaiti banks. CBK has recently organized a workshop on the topic in collaboration with the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). Waleed Al-Awadhi said that the workshop aimed to familiarize employees of the financial and banking sectors with Sharia governance.

#Kuwait's Warba Bank boosts its #realestate investments portfolio & acquires a facility of KIA Motors in #UK

Warba Bank has recently purchased a newly constructed UK vehicle imports-exports facility strategically located next to Immingham port. The property is leased to KIA Motors UK for unbreakable lease term of 20 years. The facility has a capacity of over 15,550 cars and totalling 86.68 acres (35.08 hectares) of land. In addition, the site also includes a warehouse space of 63,515 ft.² (5,901 m²), facilitating distribution, refurbishment, valet, inspection, refuelling, offices and gatehouses. The site receives on average c.1,200 vehicles a week. KIA anticipate 100,000 UK car sales target by 2020. Warba Bank’s CEO, Shaheen Hamed Al Ghanem, said this acquisition was one of the best risks mitigated real estate investment of the bank, generating a steady and secured return from unbreakable long lease. He elaborated that the investment plan for 2017 is highly ambitious and the bank is looking for more international real estate investment opportunities in USA, UK and other continental European countries.

#Suriname #Islamic #bank selects #Kuwaiti technology #partner

Trustbank from Suriname is one step closer to open its doors to customers interested in Islamic banking products after it signed a new licensing deal with the Kuwaiti based software vendor, Path Solutions, to implement Islamic Banking and Investment System as a new core banking platform.
This is major thing for the Path Solutions, as it’s the company’s first Islamic core banking software deal in the Americas. The company won the deal as one of three shortlisted vendors besides Oracle FS, Temenos. Path Solutions won the deal because of ist Sharia compliance, product functionality and technological superiority.

#GCC sovereigns to lead emerging market #bond issues in #2017

GCC is expected to account for about 31% of sovereign bond issuances from emerging markets this year. The expected 2017 sovereign issues will be distributed among GCC, Eastern Europe Middle East Africa and Latin America, according to forecasts by Bank of America Merrill Lynch.
Issues from the GCC has been increasing rapidly mainly due to low oil prices, with some new issuers in 2016, and analysts expect the 2017 issuance to continue to be high. Among those, Kuwait inaugurated the external sovereign debt market with $8 billion (Dh29.3 billion) to finance a budget deficit resulting from low oil prices. Sovereign issuance for 2017 is forecast to be 6% higher compared to the previous year. In 2016, sovereigns issued $135 billion, mainly from Latin America, while corporates issued about $300 billion, mainly from Asia. Analysts expect gross sovereign external issuance to come in at $144bn in 2017.

Warba Bank launches marketing campaign for USD-250-mln #sukuk

Kuwait's Warba Bank announced the launch of a marketing campaign for sukuk to be issued with a total value of USD 250 million. Warba Bank's CEO Shaheen Hamad Al-Ghanim said the campaign targets investors in Kuwait and Gulf Cooperation Council (GCC) countries, in addition to global stock markets. Al-Ghanim explained that the bank signed a deal with an international advisor to a new strategy for 2021, which is based on improving the bank's operations and further enhancing the quality of assets and diversifying sources of income. He noted that Warba Bank has previously obtained approvals from the Central Bank of Kuwait and Capital Market Authority, while the General Assembly has authorized the board of directors to issue sukuk.

#Kuwait’s Islamic banks thrive despite continued economic uncertainty

Despite the global drop in oil prices, Islamic finance continues to thrive. According to the EY consultancy, Sharia-compliant banking grew at an annual rate of 17.6% between 2009 and 2013, and is now projected to grow by an estimated 19.7% annually by 2018. This rate of growth far outpaces that of conventional banks, putting pressure on traditional banks to diversify their operations by including Sharia-compliant services. Kuwait International Bank (KIB) converted to exclusively Sharia-compliant services in 2007 and paved the way for Islamic finance in Kuwait. Sheikh Mohammed Al-Jarrah Al-Sabah, Chairman of KIB, said the bank has adopted a new strategic outlook which had its first stage launched in 2015. This brought about a change in KIB’s franchise operations and its day-to-day activities. The second phase develops the bank's product and service offerings. The final stage scheduled for 2017 will focus on boosting KIB’s competitive edge within the banking industry.

Diversification in the #Gulf

The banking sector in #Kuwait remains solid, robust and unaffected by regional events. The operating environment can be described as low-risk thanks to the country’s central bank regulatory role and conservative approach. Kuwait International Bank (KIB) has risen to become one of the most established in Kuwait. The bank's CEO, Loai Muqames, says diversification into the retail sector took priority with the launch of stand-alone retail banking operations. Since adopting a unified CRM system the quality and efficiency of the customer service has dramatically increased. KIB partners with Kuwait’s telecom providers to offer SMS banking for those account holders without a mobile internet connection. KIB is also investing in those sectors related to the $100bn government funded national development plan currently in motion. These sectors include infrastructure, oil and gas, energy, and real estate.

KFH welcomes CBK’s Sharia Supervisory Governance for banks – Regulations instill confidence in Islamic banking: Duwaishan

Kuwait Finance House (KFH) has welcomed the Central Bank of Kuwait (CBK)’s instructions and regulations regarding the role of Sharia Supervisory Boards in Islamic banks. Islamic Banks would be given until December 31st, 2017 to fulfill the requirements. Isa Abdullah Duwaishan, Executive Manager Shariah Control & Advisory at KFH, stated that the executive team of the board encompasses qualified Shariah controllers who audit the compliance and commitment of all bank departments to sharia rules. He reiterated the efforts of continually improving the skills of Shariah controllers and the Shariah staff in the bank through engaging them in specialized training courses. KFH's Shariah Supervisory Board issues Fatwa and Shariah reports that are viewed as a reference to other banks.

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