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KUWAIT CITY, Jan 28: The Central Bank of Kuwait affirmed that it did not issue any guarantee on behalf of the government to any of the banks, in accordance with the provisions of articles 2 and 3 of decree-law No. 2/2009 regarding the promotion of financial stability, reports Al-Rai daily.
In its annual report on the value of bonds, sukuk and government support, in implementation of the provisions of the “Financial Stability” law, which it submitted to both the National Assembly and the State Audit Bureau, the Central Bank of Kuwait explained that the grace period for state guarantee is in accordance with the provisions of the two articles that authorize state guarantee and for a period not exceeding 15 years from the date of issuance.
The guarantee, the deficit in the specific provisions that must be formed against the credit facilities portfolio and the existing finance with banks, as well as the decrease that may occur in the value of each of the financial investment portfolio and the real estate portfolio outstanding with banks on December 31, 2008, has legally expired as of January 1, 2012.
All financing balances provided by banks to clients have been paid, just as none of the investment companies obtained guaranteed financing from the state, and therefore the Ministry of Finance did not issue bonds or sukuk in this regard. Based on article 9 of decree law No. 2/2009, the grace period for new government-guaranteed funding legally expired on January 1, 2011.
The bank confirmed that no government support was provided, in accordance with the provisions of article 6 and clause 2 of the same decree, to any of the banks or investment companies until the end of last year.