ABK Strategic Overview and Financial Performance
Overview of Kuwait
Banking Sector
الأهلي
авк
23
6
Conventional
Banks
5
local
Islamic Banks
Stringent
All banks
regulated by
the Central
Basel III
requirements
Bank of
Kuwait
23
Banks
12
Kuwaiti banking sector snapshot
foreign bank
branches
100%(2)
Principal
Deposit
Guarantee Law
in effect
USD
234bn(¹)
of banking
assets
The Kuwaiti banking sector comprises of 23 banks, including six
conventional banks ( one specialised bank), five Shari'a-compliant
local banks and branches of 12 international banks which includes a
non-Kuwaiti Islamic bank.
Highly regulated sector by the CBK with a number of regulations and
supervisory practices in place monitoring interest rates charged,
lending limits and concentrations, investment limits, liquidity and
capital adequacy.
The government's financial strength underpins its capacity to
provide support to the banking sector with historical evidence of
support. Most recently, in 2008, the State of Kuwait offered capital
support to a bank as well as introduced a guarantee on customer
deposits under the Deposits Guarantee Law following the global
financial crisis.
Capital adequacy standards under the Basel III framework were
implemented by CBK In June 2014. The Tier I ratio and the total capital
adequacy ratio required by the CBK are 11% and 13% respectively
from December 31, 2016. ABK has been designated as a domestically
systemic important bank ("D-SIB") with an additional Common Equity
Tier 1 D-SIB surcharge of 0.5% required from December 31, 2016.
(1)
(2)
Central Bank of Kuwait, KD/USD = 0.3030 as of 31 December 2019
The Kuwaiti government passed Law No.30 of 2008 (the "Deposits Guarantee Law") to guarantee deposits held with local banks. Under the Deposit Guarantee Law, the Kuwaiti
government has undertaken to guarantee the principal, but not interest, of all deposits held with local banks in Kuwait, including savings and current accounts
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