KUWAIT CITY, March 17, (AFP): A number of Kuwaiti banks have decided to launch legal proceedings against two troubled Saudi business groups for debt estimated at around $1.5 billion, a newspaper reported on Wednesday.
The banks took the decision after months of negotiations with the Saad and Algosaibi groups ended in deadlock, Al-Qabas daily said, citing unnamed sources familiar with the issue.
The creditor banks including Gulf Bank, Commercial Bank and Burgan Bank, in addition to Kuwait Finance House, the largest Islamic lender, have formed a joint committee to pursue the issue, the report said.
The banks are expected to file lawsuits in Kuwait, Saudi Arabia and in Britain.
Another Kuwaiti lender, Al-Ahli Bank has already filed a lawsuit against the two Saudi groups in New York, the paper said.
Kuwait last June ordered a freeze in dealings with the two Saudi conglomerates which have been severely impacted by the global financial crisis and their total debts are believed to top $20 billion.