Local banks may have to raise capital: CBK

Dr. Mohammad Yousef Al-Hashel

KUWAIT: Governor of the Central Bank of Kuwait Mohamed Al-Hashel said that the results of severe stress tests conducted by banks in the recent past are reassuring, with varying degrees from one bank to another. The results also suggest that the local banks may be required to increase their capital, sources told the Al-Rai newspaper.
Al-Hashel added, during a meeting with banks’ CEOs, that the Central Bank will be flexible with the shocks that each bank may encounter, and these shocks will be addressed gradually, according to the financial position and conditions of each bank.
The sources also reported that Al-Hashel highlighted the necessity for banks to take precautionary measures to face coronavirus repercussions, and not to exhaust liquidity, in order to boost their ability to face the credit risk that may arise in 2021, by not distributing cash dividends to their shareholders for 2020.

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