Regulatory Alerts2009-04-09
Law on Financial Stability and Enhancement of Bank Conditions
The Central Bank of Kuwait issued Law Decree No. 2 of 2009 to enhance state financial stability by guaranteeing deficits in local banks' credit facilities and investment portfolios as of December 31, 2008. The decree mandates banks to calculate provision deficits, maintain unified monitoring systems, and secure state guarantees that reduce annually by at least eight percent over a fifteen-year period. Banks must also pursue capital increases through convertible bonds or preferred shares while allocating up to KD 4 billion in new financing to designated productive private sectors.
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