KUWAIT, June 14, (RTRS): National Bank of Kuwait (NBK) said on Sunday it has agreed with Commercial Bank of Kuwait (CBK) to buy its stake in Islamic lender Boubyan Bank for about KD 120 million  ($416.7 million). Last month Islamic finance firm Investment Dar filed a complaint against CBK in a dispute over the latter’s stake in Boubyan. CBK owns a 19.2 percent of Boubyan according to the bourse website. The complaint to the police came after CBK said Investment Dar and related firms had lost their right to buy back a 19.2 percent stake in Boubyan under a 2008 agreement. It was not immediately clear if the deal could be affected by CBK’s dispute with Dar. “CBK will sell its shares in Boubyan Bank amounting to 220,631,095 shares to NBK for 550 fils per share,” NBK, the country’s biggest lender by assets, said in a statement on Sunday. There are 1,000 fils in a dinar.

NBK said in April it has central bank approval to buy up to 40 percent in Boubyan Bank. NBK has been expanding to offset rising competition at home by buying Al-Watany Bank of Egypt and a 40 percent stake in Istanbul-based Turkish Bank in 2007. It is also active in Qatar through affiliate International Bank of Qatar (IBQ). “The move complements NBK’s strategic drive to enter the Islamic banking industry that is witnessing high growth potential,” NBK said in the statement, adding the transaction would be carried through the bourse. It did not give further details in the statement. Boubyan Bank, which complies with Islam’s ban on interest, competes with larger rival Kuwait Finance House and Kuwait International Bank. Kuwait’s sovereign wealth fund is the largest shareholder in Boubyan with a 20 percent stake, bourse data showed. Shares of NBK surged 6.25 percent on Sunday, Boubyan rose 5.38 percent and CBK clocked up 1.85 percent.