The Banking Executive Magazine - April 2024

Kuwaiti Banks Kuwaiti Banks DEMONSTRATE RESILIENCE AMID CHALLENGES The financial performance of Kuwaiti banks in recent years, particularly during the period from 2019 to 2023, demonstrates their resilience and ability to navigate through chal- lenges, including the COVID- 19 pandemic, reports Al-Anba daily. Despite facing economic uncertain- ties and the need to reserve provi- sions for credit losses, Kuwaiti banks have maintained solid profitability and continued to reward their share- holders with cash dividends. Here’s a summary of the key points highlighted in the analysis: OVERALL PERFORMANCE Kuwaiti banks achieved consolidated net profits of 5 billion dinars during the five years from 2019 to 2023. Despite challenges posed by the pandemic, they maintained prof- itability and distributed cash divi- dends totaling 2.55 billion dinars, equivalent to a cash distribution ratio of 50% of net profits. Cash Distribu- tion Ratio — The cash distribution ratio averaged 50% over the last five years, indicating a consistent com- mitment to returning value to share- holders through dividends. National Bank of Kuwait (NBK) — NBK emerged as the top performer among local banks, recording the highest profits of 2.08 billion dinars during the five years. It distributed approxi- mately 54% of its net profits as cash dividends, totaling 1.12 billion di- nars. NET PROFITS KUWAIT FINANCE HOUSE (KFH) The KFH ranked second in terms of net profits, achieving 1.59 billion di- nars over five years. It distributed cash dividends equivalent to 51% of net profits, totaling 806.5 million di- nars. In 2023, KFH’s cash distribu- tions reached a record high of 292 million dinars, representing 50% of that year’s net profits. Boubyan Bank – The Boubyan Bank secured the third position in net profits with a total of 284 million dinars over five years. It distributed cash dividends worth 96 million dinars, equivalent to 34% of net profits during that pe- riod. In 2023, its cash distributions increased to 31.7 million dinars, rep- resenting 39% of the year’s net prof- its. GULF BANK The Gulf Bank achieved the fourth- highest net profits of 267.6 million dinars over five years. It distributed cash dividends totaling 143.4 million dinars, equivalent to 54% of net prof- its during that period. In 2023, Gulf Bank’s cash distributions peaked at 43.5 million dinars, constituting 61% of the year’s net profits. BURGAN BANK The Burgan Bank distributed cash dividends worth 107 million dinars over the last five years against net profits of 259.4 million dinars result- ing in a dividend-to-net profits ratio of 41%. Overall, Kuwaiti banks have demonstrated robust financial per- formance, balancing profitability with shareholder returns, despite fac- ing various challenges. The distribu- tion of cash dividends underscores their commitment to creating value for shareholders and maintaining in- vestor confidence in the banking sec- tor. the BANKING EXECUTIVE 32 ISSUE 184 APRIL 2024