KUWAIT CITY, March 13: The Board of Directors of the Commercial Bank of Kuwait is pleased to announce that the Bank has reported KD 130.9 million profits before provisions. Based on the Board of Directors’ decision to protect the Bank’s capital base and shareholders’ value, the Bank’s Board of Directors has allocated a similar amount for provisions against the loan and investment portfolios.
Chairman and Managing Director, Abdulmajeed AlShatti explained that the Bank’s prudent policy towards building up a strong provision base would continue during 2010. Given the level of uncertainty, both locally and internationally we have to remain carefully optimistic. AlShatti further added, “We believe it is sensible to be very conservative to ensure the Bank’s continuity as a leading financial institution in the State of Kuwait”.

Chairman and Managing Director Abdulmajeed AlShatti further explained, “While we believe that the Government and the Central Bank of Kuwait have taken the right action to support the economy the outlook remains uncertain and we remain carefully optimistic. The Five year Development Plan recently announced by the Government will boost the economy once implemented and the Bank fully supports the initiative to transform Kuwait into a regional financial and commercial hub”.
Commercial Bank’s total assets are KD 3.6 billion at the end of December 2009 and its shareholders equity stood at KD 439.9 million. The Bank continues to build provisions and conserve capital. As at 31st December 2009, the Bank has a total of KD 186.6 million of post liberation provisions with KD 111.6 million of specific provisions and KD 75.0 million of general provisions. In addition to the loan and investment provisions, the Bank has KD 91.9 million of retained earnings available as an additional cushion.

The capital adequacy ratio of 18.22 percent comfortably exceeds the minimum 12 percent required by the Central Bank of Kuwait; the Bank continues to have a strong capital base, and more than twice the international ratio required by Basel II. Commercial Bank of Kuwait is the second highest rated bank in Kuwait with Capital Intelligence, Fitch Ratings, Moody’s and Standard & Poor’s.
Chairman and Managing Director Abdulmajeed AlShatti took the opportunity on behalf of the Board of Directors “To thank the Banks valued customers for their trust and confidence, the Executive Management team headed by Jamal Al-Mutawa and the Banks staff for their hard work and loyalty and shareholders for their continued support and faith”.
The statement did not give detailed figures for annual results and company officials were not available to comment.
“While we believe that the government and the Central Bank of Kuwait have taken the right action to support the economy, the outlook remains uncertain and we remain carefully optimistic,” Abdulmajeed AlShatti, the bank’s chairman and managing director, said in the statement. The bank had reported a profit of KD 100.7 million in 2008.
Ratings agencies said in February that banks in Kuwait and Dubai would face a tougher 2010 than their Gulf peers as lenders in the region continue to take provisions against bad credit, which will curtail profits.