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Wednesday , September 30 2020

Central Bank asks banks to examine conditions of 50 biggest customers

Bid to reevaluate major debt positions

KUWAIT CITY, April 30: The Central Bank of Kuwait requested the banks to provide a quantitative and qualitative statement concerning the conditions of each of the 50 biggest clients.

In light of the various accelerated regulatory laws in support of the banks in facing the repercussions of the coronavirus crisis, the Central Bank holds extensive meetings with bank officials on more than one file, including the reassessment of major debt positions, the daily added.

It said the Central Bank has asked each bank to determine the level of cash flow and profitability expected for the 50 biggest customers, the future value of their guarantees and the extent of their ability to pay obligations on time if they were exposed to a set of difficult scenarios.

It should be with an explanation of whether any of them had already submitted to its bank requesting the deferment of debt installments or reschedule due to the consequences of the coronavirus.

The banks had previously decided to postpone the installments of loans for individuals, small and medium-sized companies and establishments affected by “Corona” for six months since last March until next September, without any penalties or late fines, relieving the pressure of repayment on all customers.

Based on the study prepared by the Higher Steering Committee for Economic Stimulus, headed by the Central Governor Dr Muhammad Al- Hashel, it’s expected that revenues of the affected sectors in Kuwait will decrease by 15 to 30 percent , under the scenarios of the closure for a period of 8 to 12 weeks, since the start of the government closure, with varying impacts for each sector, it noted.

It reiterated the rate of decline in global economic activity in the second quarter of 2020 is likely to be the most severe since the Second World War.

Meanwhile, Kuwait Banking Association (KBA) announced the increase in the number of Kuwaiti banks operating to reach a minimum of 25 percent of the total number of branches of each bank starting from April 26, 2020 to meet the needs of clients and achieve the objectives of the soft loan plan for clients as per the directives of Central Bank of Kuwait Governor Dr Muhammad Al-Hashil.

On the other hand, KBA said the local bank branches scheduled to operate during the blessed month of Ramadan will receive customers from 10:00 am until 1:00 pm. Secretary General of KBA Dr Hamad Al-Hassawi explained the working hours of employees during Ramadan will be from 9:30 in the morning until 1:30 in the afternoon.

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