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Kuwait bounces backMarch 31 2022

Markaz CEO signals the need for Kuwaiti bank consolidation

The Kuwait Financial Centre, more commonly known as Markaz, is one of the country’s leading investment banks. CEO Ali H Khalil talked to The Banker about the importance of Kuwait’s stalled debt law, the outlook for deposits in the banking sector after 2021’s declines and the likelihood of consolidation in the local banking market.
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Markaz CEO signals the need for Kuwaiti bank consolidation

Q: How serious a problem is liquidity in the economy and the banking sector for the coming year? Will a cash crunch be averted due to higher oil prices?

A: Kuwait’s government owes Kd2.35bn ($7.8bn) in late payments to public entities, according to Ministry of Finance data, due to the lack of liquidity in the Treasury’s accounts. Even in the absence of a new debt law, Kuwait should be able to fulfil its financial obligations, especially with the higher oil prices. The main issue is not the government’s ability to meet its financial obligations, but the depletion of General Reserve Fund assets. The government has been taking several measures to mitigate this, such as raising funds by way of asset swaps with the Future Generations Fund.

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John Everington is the Middle East and Africa editor. Prior to joining The Banker, John was the deputy business editor of The National in the UAE, and has also worked for Dealreporter, Arab News and The Telegraph. He has also covered the telecom sector in Africa and the Middle East, living and working in Qatar and the UK. John has a BA in Arabic and History and an MA in Middle Eastern Studies from the School of Oriental and African Studies (SOAS) in London.
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