Latest news with #AbdullaAlSumait
Yahoo
29-03-2025
- Business
- Yahoo
Kuwait Is Set to Allow Banks to Offer Mortgages for the First Time
(Bloomberg) -- Kuwait is preparing to allow banks to offer mortgages for the first time, a move that could reshape the oil-rich nation's financial landscape. New York Subway Ditches MetroCard After 32 Years for Tap-And-Go LA Faces $1 Billion Budget Hole, Warns of Thousands of Layoffs Despite Cost-Cutting Moves, Trump Plans to Remake DC in His Style Amtrak CEO Departs Amid Threats of a Transit Funding Pullback NYC Plans for Flood Protection Without Federal Funds The legislation is expected to be passed soon by the Council of Ministers, according to people familiar with the matter. The move would unlock a market that could eventually reach a value of $65 billion, implying a 40% expansion in lenders' credit portfolios, according to the people, who declined to be identified as the information is private. Traditionally, mortgages were neither allowed nor regulated, as policymakers feared the political repercussions of foreclosures on citizen-owned homes. Instead, the government has a public housing program for married citizens to receive a highly-subsidized house or a plot with a low-interest loan. But the system has been buckling under a backlog of 103,000 requests and handover rates suggesting a decade-long wait, prompting the government to plan significant changes to the system. Government officials couldn't be reached for comment on Friday, a public holiday in the country. Get the Mideast Money newsletter, a weekly look at the intersection of wealth and power in the region. Kuwait's oil wealth has propelled it into the ranks of the world's richest countries, but years of policy paralysis have meant the nation has lagged its more ambitious peers in the Middle East. The long-awaited law could provide a 'structured framework that enhances home financing accessibility for eligible citizens,' said Abdulla Al Sumait, acting group chief executive officer at Al Ahli Bank of Kuwait. 'We see this as a transformative step.' The introduction of the mortgage law would come 10 months after Kuwait's emir suspended parliament for up to four years, effectively clearing the way for the government — headed and appointed by the ruling Al-Sabah family — to pass key bills. Just days earlier, the cabinet approved a draft decree that paves the way for the OPEC-member state to sell international debt for the first time in eight years. Those moves have already led to optimism in markets. Kuwaiti stocks are outpacing their Gulf peers this year, with banks driving the rally — Boubyan Bank KSCP, Burgan Bank SAK and Warba Bank KSCP are all up 17% or more. The pent up demand for housing means that mortgages, even with significant regulatory limitations, could significantly boost Kuwaiti lenders' profitability, according to Justin Alexander, director of Khalij Economics and an analyst for consultant GlobalSource Partners. It could also spur foreign interest in banking stocks. There's currently 4.7 billion dinars ($15.3 billion) of foreign investments in Kuwaiti banks, representing 15% of the sector. 'This opportunity goes beyond the direct impact from housing finance, considering the magnitude of infrastructure investments needed to develop new residential areas to meet the growing demand for housing in Kuwait,' said Shaikha Al-Bahar, deputy group CEO at National Bank of Kuwait SAKP. What Bloomberg Intelligence Says... The legislative amendments could potentially include mortgage durations, state subsidies, interest rate caps, and regulatory limits such as debt service ratio. Accelerating mortgage market could stimulate construction sector, potentially driving domestic credit growth to high single digits over the medium term. - Salome Skhirtladze, Europe Middle East and Africa financials analyst. Untapped Market The mortgage law is expected to spur a real-estate expansion over many years. 'It should increase project awards to create infrastructure and new cities, and increase housing starts,' said Jaap Meijer, head of research at Arqaam Capital in Dubai. Behind the scenes, the government is lining up other changes. Officials have activated a new law for urban development and the Public Authority for Housing Welfare recently signed a consulting services contract to develop three residential sites with over 5,000 housing units. 'Kuwait offers much,' said Bader Al-Saif, an assistant professor at Kuwait University and an associate fellow at Chatham House. 'It's an untapped market when compared to its immediate neighbors.' A New 'China Shock' Is Destroying Jobs Around the World Tesla's Gamble on MAGA Customers Won't Work How TD Became America's Most Convenient Bank for Money Launderers One Man's Crypto Windfall Is Funding a $1 Billion Space Station Dream The Real Reason Trump Is Pushing 'Buy American' ©2025 Bloomberg L.P. Sign in to access your portfolio
Zawya
24-03-2025
- Business
- Zawya
Kuwait to open mortgage market for the first time
KUWAIT CITY - Kuwait is preparing to allow banks to offer mortgages for the first time, a major development that could reshape the country's financial sector. The legislation is expected to be passed soon by the Council of Ministers, according to sources familiar with the matter. This move could open up a market potentially worth $65 billion, which would expand lenders' credit portfolios by 40%, according to the sources, who requested anonymity due to the sensitive nature of the information. Historically, mortgages were not permitted or regulated in Kuwait due to concerns over the political ramifications of foreclosures on citizen-owned homes. Instead, the government has offered a public housing program, where married citizens can receive highly subsidized housing or a plot with a low-interest loan. However, the system has faced significant challenges, with a backlog of 103,000 housing requests and wait times stretching over a decade. This has led the government to plan major changes to address the situation. Kuwait's oil wealth has positioned it as one of the world's richest nations, but policy stagnation has caused it to fall behind its more ambitious neighbors in the region. The upcoming mortgage law is expected to provide a "structured framework" to improve home financing access for eligible citizens, according to Abdulla Al Sumait, acting group CEO of Al Ahli Bank of Kuwait. Al Sumait referred to the development as a transformative step for the country. The introduction of the mortgage law comes just 10 months after Kuwait's emir suspended parliament for up to four years, allowing the government—led by the Al-Sabah family—to pass important legislation. Just days before, the cabinet had approved a draft decree that set the stage for Kuwait to sell international debt for the first time in eight years. These political moves have already created optimism in the markets, with Kuwaiti stocks outperforming their Gulf peers this year, particularly driven by banks like Boubyan Bank KSCP, Burgan Bank SAK, and Warba Bank KSCP, which have each seen gains of 17% or more. The significant demand for housing in Kuwait suggests that even with regulatory limitations, the introduction of mortgages could greatly enhance the profitability of Kuwaiti banks, according to Justin Alexander, director of Khalij Economics and an analyst at GlobalSource Partners. The new development could also attract foreign interest in Kuwaiti banking stocks. Currently, foreign investments in Kuwaiti banks total 4.7 billion dinars ($15.3 billion), representing 15% of the sector. 'This opportunity extends beyond just housing finance, considering the large-scale infrastructure investments needed to develop new residential areas to meet the growing demand for housing in Kuwait,' said Sheikha Al-Bahar, deputy group CEO at the National Bank of Kuwait. Bloomberg Intelligence analysts suggest that the new legislative amendments could include provisions on mortgage durations, state subsidies, interest rate caps, and regulatory limits such as debt service ratios. A growing mortgage market could stimulate the construction sector and drive domestic credit growth, potentially reaching high single-digit growth over the medium term. The mortgage law is also expected to spur real estate development in the coming years. 'It should increase project awards for creating infrastructure and new cities and boost housing starts,' said Jaap Meijer, head of research at Arqaam Capital in Dubai. Behind the scenes, the government is also making strides with other urban development projects. The Public Authority for Housing Welfare has signed a consulting services contract to develop three residential sites with more than 5,000 housing units. Kuwait's market is considered relatively untapped compared to its neighboring countries. Bader Al-Saif, an assistant professor at Kuwait University and associate fellow at Chatham House, stated, 'Kuwait offers much. It's an untapped market when compared to its immediate neighbors.' The planned changes signal the government's commitment to addressing the country's housing challenges and improving the financial landscape.
Arab Times
22-03-2025
- Business
- Arab Times
Kuwait to open mortgage market for the first time
KUWAIT CITY, March 22: Kuwait is preparing to allow banks to offer mortgages for the first time, a major development that could reshape the country's financial sector. The legislation is expected to be passed soon by the Council of Ministers, according to sources familiar with the matter. This move could open up a market potentially worth $65 billion, which would expand lenders' credit portfolios by 40%, according to the sources, who requested anonymity due to the sensitive nature of the information. Historically, mortgages were not permitted or regulated in Kuwait due to concerns over the political ramifications of foreclosures on citizen-owned homes. Instead, the government has offered a public housing program, where married citizens can receive highly subsidized housing or a plot with a low-interest loan. However, the system has faced significant challenges, with a backlog of 103,000 housing requests and wait times stretching over a decade. This has led the government to plan major changes to address the situation. Kuwait's oil wealth has positioned it as one of the world's richest nations, but policy stagnation has caused it to fall behind its more ambitious neighbors in the region. The upcoming mortgage law is expected to provide a "structured framework" to improve home financing access for eligible citizens, according to Abdulla Al Sumait, acting group CEO of Al Ahli Bank of Kuwait. Al Sumait referred to the development as a transformative step for the country. The introduction of the mortgage law comes just 10 months after Kuwait's emir suspended parliament for up to four years, allowing the government—led by the Al-Sabah family—to pass important legislation. Just days before, the cabinet had approved a draft decree that set the stage for Kuwait to sell international debt for the first time in eight years. These political moves have already created optimism in the markets, with Kuwaiti stocks outperforming their Gulf peers this year, particularly driven by banks like Boubyan Bank KSCP, Burgan Bank SAK, and Warba Bank KSCP, which have each seen gains of 17% or more. The significant demand for housing in Kuwait suggests that even with regulatory limitations, the introduction of mortgages could greatly enhance the profitability of Kuwaiti banks, according to Justin Alexander, director of Khalij Economics and an analyst at GlobalSource Partners. The new development could also attract foreign interest in Kuwaiti banking stocks. Currently, foreign investments in Kuwaiti banks total 4.7 billion dinars ($15.3 billion), representing 15% of the sector. 'This opportunity extends beyond just housing finance, considering the large-scale infrastructure investments needed to develop new residential areas to meet the growing demand for housing in Kuwait,' said Sheikha Al-Bahar, deputy group CEO at the National Bank of Kuwait. Bloomberg Intelligence analysts suggest that the new legislative amendments could include provisions on mortgage durations, state subsidies, interest rate caps, and regulatory limits such as debt service ratios. A growing mortgage market could stimulate the construction sector and drive domestic credit growth, potentially reaching high single-digit growth over the medium term. The mortgage law is also expected to spur real estate development in the coming years. 'It should increase project awards for creating infrastructure and new cities and boost housing starts,' said Jaap Meijer, head of research at Arqaam Capital in Dubai. Behind the scenes, the government is also making strides with other urban development projects. The Public Authority for Housing Welfare has signed a consulting services contract to develop three residential sites with more than 5,000 housing units. Kuwait's market is considered relatively untapped compared to its neighboring countries. Bader Al-Saif, an assistant professor at Kuwait University and associate fellow at Chatham House, stated, 'Kuwait offers much. It's an untapped market when compared to its immediate neighbors.' The planned changes signal the government's commitment to addressing the country's housing challenges and improving the financial landscape.
Zawya
30-01-2025
- Business
- Zawya
Al Ahli Bank of Kuwait secures landmark $1bln global syndicated term loan facility
KUWAIT CITY - Al Ahli Bank of Kuwait (ABK), through its DIFC Branch, has successfully closed a landmark USD 1 billion global syndicated term loan facility for a period of over 3 years, marking its largest debt facility to date. This significant achievement affirms ABK's robust standing in the financial markets. The syndication was initially launched at USD 750 million; however, due to excessive oversubscription by 60%, the facility was upsized to USD 1 billion. This positive response highlights the strong liquidity position and confidence that both regional and international lenders, including those from the Middle East, US, Europe, and Asia, have in ABK. 'We are immensely proud to have secured this significant facility,' said Abdulla Al Sumait, Acting Group Chief Executive Officer at ABK. 'This achievement reflects the trust and confidence that our lenders have in our financial stability and strategic vision. We are committed to utilizing these funds to enhance our service offerings and continue to foster sustainable growth.' The proceeds from the facility will primarily be utilized to replace an existing loan facility and meet general funding requirements. This strategic move positions ABK to better serve its clientele while supporting overall business development. The facility was led by a consortium of financial institutions including Commerzbank, Doha Bank, Emirates NBD Capital, ICBC, and SMBC, who acted as Bookrunners and Mandated Lead Arrangers. SNB also joined as a Mandated Lead Arranger, with ADCB, HSBC, and NBF as Lead Arrangers. The syndicate was further supported by Bank of Baroda, China Construction Bank, Mashreqbank, Korea Development Bank, Banque Misr, Bank of NY Mellon, and Fubon Bank, as Arrangers, and Bankinter, Industrial Bank of Korea, and Citi Bank as Managers. Emirates NBD Capital acted as Documentation Bank and Emirates NBD as Facility Agent. Al Sumait concluded, 'At ABK, we remain dedicated to our growth ambitions and are pleased to have the support of our esteemed financial partners in this endeavour. Securing such a substantial facility demonstrates our resilience and commitment to innovation. We are keen on the opportunities this funding will create for ABK as we continue to enhance our service offerings.'
Arab Times
29-01-2025
- Business
- Arab Times
ABK Secures Landmark USD 1 Billion Global Syndicated Term Loan Facility
KUWAIT CITY, Jan 29: Al Ahli Bank of Kuwait (ABK), through its DIFC Branch, has successfully closed a landmark USD 1 billion global syndicated term loan facility for a period of over 3 years, marking its largest debt facility to date. This significant achievement affirms ABK's robust standing in the financial markets. The syndication was initially launched at USD 750 million; however, due to excessive oversubscription by 60%, the facility was upsized to USD 1 billion. This positive response highlights the strong liquidity position and confidence that both regional and international lenders, including those from the Middle East, US, Europe, and Asia, have in ABK. 'We are immensely proud to have secured this significant facility,' said Abdulla Al Sumait, Acting Group Chief Executive Officer at ABK. 'This achievement reflects the trust and confidence that our lenders have in our financial stability and strategic vision. We are committed to utilizing these funds to enhance our service offerings and continue to foster sustainable growth.' The proceeds from the facility will primarily be utilized to replace an existing loan facility and meet general funding requirements. This strategic move positions ABK to better serve its clientele while supporting overall business development. The facility was led by a consortium of financial institutions including Commerzbank, Doha Bank, Emirates NBD Capital, ICBC, and SMBC, who acted as Bookrunners and Mandated Lead Arrangers. SNB also joined as a Mandated Lead Arranger, with ADCB, HSBC, and NBF as Lead Arrangers. The syndicate was further supported by Bank of Baroda, China Construction Bank, Mashreqbank, Korea Development Bank, Banque Misr, Bank of NY Mellon, and Fubon Bank, as Arrangers, and Bankinter, Industrial Bank of Korea, and Citi Bank as Managers. Emirates NBD Capital acted as Documentation Bank and Emirates NBD as Facility Agent. Al Sumait concluded, 'At ABK, we remain dedicated to our growth ambitions and are pleased to have the support of our esteemed financial partners in this endeavour. Securing such a substantial facility demonstrates our resilience and commitment to innovation. We are keen on the opportunities this funding will create for ABK as we continue to enhance our service offerings.'
