Kuwait Finance House (KFH) Group Chief Executive Officer, Khaled Yousef AlShamlan said that all key financial indicators for KFH saw an overall increase in the first quarter of 2025. He stated that KFH topped the Kuwaiti banking sector in terms of net profits that approximated KD 168.1 million for Q1 2025, representing a growth of 3.2% compared to the same period last year and a 41.4% increase compared to the fourth quarter of 2024.

In an interview with CNBC Arabia TV, He added that KFH`s net financing income reached KD 318.9 million; an increase of 21.1% compared to the same period last year. Total operating income increased, supported by an increase in all core activities to reach KD 454.9 million; an increase of 15.9% compared to the same period last year. This affirms KFH`s successful strategy, solid capital base and robust operational performance.

AlShamlan mentioned that net operating income reached KD 295.7 million, an increase of 19.4% compared to the same period last year.

Speaking about the non-performing financing from the total financing and coverage ratio for Q1 2025, AlShamlan pointed out that the Group non-performing financing (NPF) ratio reached roughly 1.84% as per the Central Bank of Kuwait calculation. As for the provisions coverage ratio for KFH-Kuwait it reached approximately 337% and about 270% for the Group.

Financing and Liquidity Law

Discussing the influence of the Financing and Liquidity Law (Public Debt), on both banks and the broader economy, AlShamlan stated that it has a clear and immediate impact. He explained that this law is an integral component of economic reform, playing a role in strengthening financial stability and boosting the confidence of both domestic and international investors and lenders.

Furthermore, he noted that if the government issues sovereign bonds or Sukuk, it will improve its capacity to handle its financial commitments in the future. This will guarantee consistent public spending and support the nation`s development plans. Consequently, this will undoubtedly benefit Kuwaiti banks by improving their liquidity management effectiveness, as they can utilize excess liquidity to meet necessary financing needs.

Tariffs

Discussing the risks and consequences of a trade war involving tariffs, AlShamlan pointed out that such conflicts can slow down global economic growth, increase production cost, and cause exchange rates to become volatile. He further explained that these issues could create difficulties for certain parts of the economy, particularly those businesses that heavily rely on exporting and importing goods.

Turning to KFH, AlShamlan stated that the bank is in a strong position due to its diverse operations across different regions and sectors. Additionally, KFH`s reliance on an Islamic finance model that uses real, physical assets as its foundation offers extra security during periods of economic instability, like a tariff war.

KFH, he stated, had already integrated potential risks into its strategic planning. This was achieved by strengthening stress tests on its financing portfolios vulnerable to global trade, closely monitoring FX markets and their volatility, and ensuring coordination across its various departments to address any possible vulnerabilities in advance.

AlShamlan further commented, "While we acknowledge the significance of global risks, we are confident that KFH possesses the necessary protective measures, adaptability, and expertise to navigate this period with awareness and professionalism, ultimately transforming challenges into opportunities for growth and investment."