Standard & Poor's (S&P) expects Kuwaiti banks to continue to perform well in 2024 if they are not exposed to unexpected challenges, thanks to increased lending volumes, higher fee income, stable margins, and strong cost management efficiency.
The agency predicted that for 2025, interest rate cuts will reduce margins, but may be supportive of asset quality. In general, Gulf banks in general and Kuwaiti banks in particular remain vulnerable to a possible slowdown in economic growth due to oil market dynamics (production and prices), a possible decline in imbalances in the real estate sector and other cyclical sectors, and geopolitical risks that may lead to a shift in investor sentiment.
The continued strong performance of Kuwaiti banks during the remainder of 2024 is likely to help them overcome potential challenges, and in addition to strong results, conservative dividends are expected to help maintain or further enhance banks' capitalization.
Source (Al-Rai Kuwaiti Newspaper, Edited)
