Financial Crime World

Kuwait’s Financial Market Performance: A Robust Recovery

Overview

Kuwait’s financial market has experienced significant growth over the past few years, with several key factors contributing to its success. This article provides an overview of the country’s financial market performance from 2020 to 2022, highlighting the main points that have driven its growth.

Key Factors Driving Growth

  • Robust Economic Recovery: Kuwait experienced a strong rebound in 2021 after facing economic challenges due to COVID-19 and lower oil prices.
  • Increased Corporate Bond Issuances: In 2020, Kuwait issued $2.6 billion in bonds, compared to $500 million in 2019. Sukuk issuances also increased from $800 million in 2019 to $1.5 billion in 2021.
  • Growing Asset Management Industry: Several key players in the asset management space are driving growth, including Markaz, KAMCO Investment Company, and National Investments Company (NIC).
  • Regulatory Improvements: Ongoing regulatory improvements, a growing economy, strong oil prices, and expected infrastructure spending are anticipated to continue driving Boursa Kuwait’s growth.

Potential Challenges Ahead

  • The transition to a new Cabinet following the September 2022 parliamentary elections may create obstacles to the approval of legislation, potentially delaying economic reforms like the public debt law.

Key Players in the Financial Market

National Industries Group

  • Completed a KD40 million ($131.6 million), two-tranche bond issuance in September 2022.

Gulf Insurance Group

  • Issued its first perpetual bond, a KD60 million ($197.5 million) instrument issued in two tranches in November 2021.

Warba Bank’s SPC (SPC)

  • Launched a sharia-compliant trust certificate issuance, worth KD150 million ($493.6 million), in Dublin.

Boubyan Bank

  • Made its first senior, unsecured Tier-1 sukuk issuance of $500 million in the Irish capital.

Conclusion

Kuwait’s financial market is poised for further growth and expansion in 2023 and beyond due to several factors, including ongoing regulatory improvements, a growing economy, strong oil prices, and an expected increase in infrastructure spending.