KIB achieved significant assets growth and brand standing in 2019

The Shareholders Annual General Meetings (AGM/EGM) of KIB held on 26 March 2020 and attended by 83.7% of shareholders.  The meetings were  convened in a manner that took into account the public safety  complying with all the preventive measures issued by the Ministry of Health Further,  instructions and guidelines were applied to combat the spread of the COVID – 19 virus, for example KIB provided hand sanitizers, a specialized medical team  monitored the temperatures and ensure that there is sufficient distance between the attendees. in order to ensure the safety of all attending the meetings. 

The AGM approved the Board of Directors’ recommendation to distribute cash dividends of 7% of the nominal value of the share (7 fils per share) amounting to KD 6,797 on existing shares (excluding treasury shares). Additionally, bonus shares of 5% of the authorized, issued and fully paid up capital (5 shares for every 100 shares) to shareholders registered in the Bank's register of shareholders at the end of the entitlement date set as Tuesday, 21 April 2020. Cash dividends and bonus shares will be distributed to the entitled shareholders on Thursday, 23 April 2020.

During the AGM, Chairman of KIB, Sheikh Mohammed Jarrah Al-Sabah, commented: “During the year 2019, KIB recorded continuous developments in its systems and operations, as well as remarkable growth in business activities. This was a result of the collective and ongoing effort made by our talented people, who worked to improve the Bank’s customer service and shareholder value which reflected positively on our performance indicators, strengthened our standing and brand both locally and internationally .” 

Al-Jarrah stated that, as per the audited consolidated financial statements, KIB achieved a net profit of over  KD 17 million for the year ended 31 December 2019 and EPS of 15.01 fils. The Bank’s improved performance reflected positively on its core operational income which reached KD 68.5 compared to KD 66.6 in 2018. This was a result of 16% growth in financing income, (approximately KD 14 million), to reach approximately KD 103 million compared to approximately KD 89.5 million recorded in 2018. 

Additionally, there was a notable increase in KIB’s investment income of 160% or KD 2.5 million to reach KD 4.1 million compared to KD 1.6 million in 2018. Fees and commission income increased by 4% to reach KD 10.2 million compared to KD 9.8 million in 2018.

Upcoming Strategy (2020-2024)

Al-Jarrah added that the year 2019 witnessed a combination of economic challenges across the globe, which impacted the global economy. However, he also noted that the local economy witnessed more stability, although economic rates have slowed down, which in turn added to operational challenges.

Al-Jarrah pointed out the strength of the current Kuwaiti economy, which is based on solid fundamentals that contributed to the stability of the operating environment, despite the tensions of international and geopolitical trade in the region. KIB has been flexible to handle, based on its strong, sustainable growth of its balance sheet, successfully expanded business operations and developed its services and products. The Bank is enthusiastically forging ahead with the final stages of its strategic plan to build on what it has accomplished so far in the past five years and outline its next strategic plan for (2020-2024). which aims to build an advanced digital business model that will bring KIB closer towards its strategic vision to become the Islamic bank of choice in Kuwait.

Ongoing Improvement in Most Financial Indicators

On his part, Vice Chairman and Chief Executive Office at KIB, Raed Jawad Bukhamseen pointed out that the Bank’s total assets grew by 24% to reach KD 2.69 billion compared to 2.16 billion in 2018. This was a result of an increase in KIB’s financing portfolio of KD 260 million or 16%, to reach KD 1.86 billion compared to KD 1.60 billion in 2018. Additionally, there was an increase in the investment portfolio by KD 74 million or 44% to reach KD 240 million compared to KD 166 million in 2018. Depositors’ accounts also grew to reach KD 1.47 billion or a KD 151 million increase or an increase of 11%, compared to KD 1.32 billion recorded last year. Total shareholder equity amounted to KD 281 million, or an increase of 3%.

Bukhamseen also noted that these positive indicators have helped maintain the rate of profits in depositors’ accounts in 2019. The annualized return on KIB (KD) Deposit increased to 3.50% in 2019 and the annualized return for the long-term deposit account (three-year) was 3.70% in 2019. The Al Ithmaar Call Account for companies has achieved notable success where the net annualized return reached 1.75% at the end of 2019.. The Investment Savings Account continued to achieve the highest returns in the local market during 2019, with a net annualized return of 2.1% at the end of 2019.. Profits will be credited to eligible depositors' accounts upon announcement of financial results.

Continuous Drastic Development

Bukhamseen added that, KIB is aware of the rapid changes that the market is going through as well as intense competition from both within and outside the banking sector. Accordingly, the Bank has taken exceptional steps across all its business activities to hold true to its brand promise of being a ‘Bank for Life’. He also noted that KIB aims at building a true partnership with its customers to provide them with a unique banking experience that meets all their goals and exceeds their expectations. In 2019, the Bank continued to develop its systems, digitize operations, invest in infrastructure, as well as attract talent and develop human capital in order to enhance its competitive advantage and enable it to anticipate and respond to current and future needs.

He noted that KIB’s solid foundation built over the past few years, as well as its strong understanding of rapid technological developments and their business implications, has driven the Bank to look forward to the future with passion and positivity. Looking ahead, the Bank is set to launch another comprehensive digital transformation across all its activities and operations. The new strategic plan will include a set of initiatives aimed at developing a business model with decision-making processes using advanced analytical models to identify needs of current customers, attract new customers, forecast future needs, and develop products and loyalty programs specifically designed for them. Additionally, the plan will also include attracting new talents in financial technology and data analysis.

A Complete Digital Transformation

KIB’s Deputy Chief Executive Officer, Mohamed Said El Saka also stated that during 2019, the Bank successfully implemented its ambitious strategic plan that it launched back in 2015. By doing so, KIB was able to employ changes across most of its business activities, update its systems, develop its infrastructure, strengthen its competitive advantage, as well as witness a significant improvement in most of its key financial indicators, some of which recorded notable rates. The Bank has also developed its human capital and attract a number of exceptional talent. Additionally, KIB has formed a highly-experienced management team that works in unison with a clear strategic framework; thereby strengthening its ability to innovative, improving asset quality and shareholder returns, and brought the Bank closer to achieving its strategic vision of becoming the Islamic bank of choice in Kuwait.

El Saka added KIB’s positive performance indicators contributed to the strength of its brand, creditworthiness, and financial standing. The Bank had issued a $300 million Additional Tier 1 (AT1) Sukuk, which came as part of its expansion strategy to enhance capital adequacy at 19.24% as at 31 December 2019. The Sukuk served as a new addition to its impressive roster of success, as it received attention from investors across 26 countries worldwide with a final distribution of 51% international investors and 49% regional investors.

He also noted that KIB continues to enjoy a stable operating environment in Kuwait. Our latest credit rating reflects our exceptional standing, the strength of our strategic direction.

Continuing Our Path of Success

El Saka also noted that during the year 2019, KIB entered a new stage of a true partnership with its customers. So far, the Bank has updated its business systems and increased the effectiveness of its operations, redesigned and launched new product offerings, developed its infrastructure and invested in technical systems. By doing so, KIB’s performance indicators continued to improve year after year, becoming more capable and resilient. The Bank looks forward to a positive future to achieve its strategic goals and continue its successful journey powered by a strong vision and strategic plan.

Cadre:

Local Awards and Global Recognitions

As a testament to its positive developments and excellent results efforts in 2019, KIB garnered a number of prestigious regional and international awards. KIB was awarded the ‘Best Sharia Compliant Bank - MENA 2019’ for the fifth consecutive year by Capital Finance International (CFI.co), ‘Best Islamic Bank in Kuwait 2019’ by World Finance for the sixth consecutive year, as well as the ‘Fastest Growing Islamic Bank MENA 2019’ award from Capital Finance International (CFI.co) for the fourth consecutive year. The Bank also received the debut ‘GCC Best CSR Business Model’ award by World Finance and the ‘Best CSR Initiative – Arab Banking’ from the World Union of Arab Bankers in recognition of its efforts in improving financial literacy.

Credit Rating

According to its report issued in 2019, Fitch Ratings affirmed KIB’s Long Term Issuer Default Rating (LT-IDR) at “A+” with a Stable Outlook. Fitch also affirmed the Bank’s Viability Rating (VR) at “bb- “. Fitch Ratings also noted that the Bank has the capacity to further improve as a result of its business operations and risk appetite, as well as the stability of its assets.

Thanks and Appreciation

Al-Jarrah also lauded the Central Bank of Kuwait's continuous support for KIB’s ongoing journey. He also appreciated its supervisory role in the local banking sector in Kuwait and extended his sincere appreciation to the Bank’s Board of Directors, the executive management, the members of the Sharia Supervisory Board, all shareholders, employees and customers of the Bank. He also lauded their trust in KIB and their key role in making it what it is today.

He also lauded the efforts of the Kuwaiti government and political leadership, as well as their outstanding ability to handle the global crisis. As part of its efforts, the government issued instructions and preventive measures to combat the COVID – 19. Additionally, he also wished good health and safety for all under these exceptional circumstance, a speedy recovery for all those infected, and to protect Kuwait  under the patronage of HH the Amir of the State of Kuwait, the Crown Prince and Prime Minister.

About KIB

Kuwait International Bank (KIB) is a bank that operates according to the Islamic Shari’ah, based in the State of Kuwait. Incorporated in 1973, and originally known as Kuwait Real Estate Bank, KIB made the transition to its current Islamic operating model in 2007. In 2018, KIB embarked on a new phase of its journey full of innovation and development. As part of its new strategic direction, the Bank focuses on offering a next-level customer experience under the slogan: “Bank for Life”. 

Through a network of branches spread across the State of Kuwait, KIB offers a broad range of banking products and services, as well as innovative digital banking solutions in line with international best standards. As part of its duty towards the community, the Bank also encompasses a leading social responsibility program that aims at positively impacting all members of the community through a wide range of impactful initiatives and activities.

Today, KIB has taken concrete steps in implementing its new strategic objectives. The Bank has cemented its role as a key player in the local banking industry and has continued to maintain its strong financial performance; enabling it to be globally recognized for its strong credit rating and financial position.

© Press Release 2020