Banks see full turn around – ARAB TIMES – KUWAIT NEWS – Arab Times Kuwait News

Banks see full turn around – ARAB TIMES – KUWAIT NEWS – Arab Times Kuwait News

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KUWAIT CITY, July 30: Standard & Poor’s (S&P) expects the profitability of Kuwaiti banks to rise during the next year in light of their full recovery in 2022, supported by high profit margins, noting that the banks’ balance sheets are heading towards raising interest rates and reducing credit fees, reports Al-Rai daily. In its report on international banks for the second half of 2022, the agency suggested a gradual decline in non-performing loans in Kuwaiti banks, and that they would witness a slight contraction during the next 12 to 24 months, and that the cost of risks would remain at about 100 basis points, given that some provisions in the sector are technical according to the rules of the Central Bank of Kuwait. She stated this cost is lower than the 1.4 percent rate in 2020 and close to the rate of 0.9 percent in 2021 (calculated on the basis that banks control 60 percent of the local market share), stressing that the banks’ high allocation buffers will enable them to maintain a stable rate generally for the cost of risk, by writing off its non-performing loans when new non-performing loans arise.