Regulatory Alerts2021-12-30
Executive Procedures for Single-Person Acquisitions Exceeding 5% of Bank Capital Under Article 57
The Central Bank of Kuwait issued Circular No. (2/BS/154/2004) to implement amended Article 57 of Law No. 32, establishing strict reporting and approval requirements for any single natural or legal person acquiring over 5% of a local bank’s capital. The regulation defines indirect acquisition through joint ownership, management, and related interests, mandating that banks submit quarterly shareholder statements while requiring applicants to secure prior CBK authorization or dispose of excess equity within one to two years depending on the acquisition type. Failure to obtain approval or dispose of the excess stake restricts the shareholder’s voting rights and board influence, ensuring that capital concentration remains transparent and aligned with the Central Bank’s supervisory oversight.