Al-Ghanem: Banking sector is a key partner in development projects

Burgan Bank CEO Shahin Hamad Al-Ghanim affirmed that recent geopolitical developments have shown that resilience is no longer an option for the banking sector, but has become a fundamental component of banking strategy. He emphasized the importance of maintaining strong capital and liquidity levels, diversifying revenue sources, and continuously investing in technology and infrastructure, thereby enhancing banks’ ability to respond quickly and effectively to economic and geopolitical changes.

This came during Al-Ghanim’s participation in a dialogue session organized by the Central Bank of Kuwait and Global Finance magazine, where he addressed several key issues related to the future of the Kuwaiti banking sector, ranging from the implications of geopolitical developments, through digital transformation and artificial intelligence, and the development of capital markets, to sustainable finance and ESG standards.

Al-Ghanim clarified that crises should not be viewed solely as risks, but can also represent opportunities to rethink business models and accelerate economic diversification. He highlighted the role banks can play in directing financing toward productive sectors and projects that support long-term growth and enhance the Kuwaiti economy’s capacity to withstand changes.

Four Priorities for the Banking Sector

Al-Ghanim pointed out that the Kuwaiti banking sector has four main areas that should be prioritized in the coming phase. The foremost is digital transformation and artificial intelligence, not only to provide faster banking services, but to redesign the customer experience and improve operational efficiency. He added that the second priority is risk management and enhancing operational resilience, especially in light of growing cyber risks and ongoing economic and geopolitical uncertainty. The third priority is strengthening financing for the private sector and development projects, supporting small and medium-sized enterprises (SMEs), and backing projects and sectors linked to economic diversification. The fourth priority, according to Al-Ghanim, is the development of the local capital market. He explained that a deeper and more liquid local debt market would provide banks, companies, and investors with broader options for managing liquidity, financing, and investment. He affirmed that these priorities are built on a strong foundation enjoyed by the Kuwaiti banking sector, characterized by robust balance sheets, high liquidity levels, and strong capital ratios, which provide a solid basis for the next phase of growth and development.

Financing and Liquidity Law: A Step to Develop the Debt Market

Regarding the Financing and Liquidity Law, which allows for the issuance of sovereign bonds and sukuk up to $98 billion, Al-Ghanim viewed the law as an important strategic step for Kuwait. He noted that it serves not only as an additional tool for the government to meet its financing needs, but also for the opportunities it offers to build a deeper and more efficient local debt market. He explained that regular and transparent issuance of sovereign bonds and sukuk can help establish a clear sovereign yield curve, providing a benchmark for pricing corporate and financial institution issuances and supporting price discovery mechanisms in the market. He also noted that sovereign issuances will provide additional investment tools for banks, investment firms, pension funds, and investors, helping to improve liquidity management, diversify investment portfolios, and expand the investor base.

Al-Ghanim emphasized the particular importance of sukuk for Kuwait, given the strength of the Islamic finance sector locally and regionally. He affirmed that the volume of issuances is not the only factor; rather, a clear and regular issuance schedule and an active secondary market are essential factors in transforming the law from merely a government financing mechanism into a genuine catalyst for developing the Kuwaiti capital market.

Artificial Intelligence: Innovation Must Be Trustworthy

On the topic of technology and artificial intelligence, Al-Ghanim stressed that the question today is no longer whether the banking sector will use AI, but how to use it responsibly and securely. He stated that Burgan Bank views AI as a tool capable of redefining the customer experience and improving operational efficiency, but its application must be within a clear framework of governance, risk management, data protection, and cybersecurity. Al-Ghanim revealed that the bank has already begun implementing AI in its banking services, citing the launch of Bdr AI, which enables customers to execute various banking transactions through text or voice interaction in both Arabic and English.

He emphasized that the next phase requires a national regulatory environment that encourages innovation, with clear standards for data governance, privacy, cybersecurity, and model testing and monitoring, alongside transparency and accountability. He affirmed that true innovation in the banking sector is innovation that earns trust.

Sustainability: From Commitment to Opportunity

Regarding sustainability and sustainable finance, Al-Ghanim clarified that for Burgan Bank, sustainability is no longer just a response to global trends or disclosure requirements, but has become an integral part of the bank’s approach to growth, risk management, and long-term value creation. He noted that the bank is integrating ESG principles into its strategy, operations, investment, and financing decisions, with a focus on financing projects and activities that deliver sustainable economic, social, and environmental impacts. He pointed out that the bank has taken practical steps in this direction, including developing a sustainable finance framework, enhancing the integration of ESG criteria into investment decisions, and issuing Kuwait’s first sustainability sukuk.

Al-Ghanim added that the next phase requires shifting from viewing “sustainability as a commitment” to treating it as an opportunity, by leveraging sustainable finance to empower new companies and projects, support economic transformation, and create long-term investment opportunities.

He concluded by affirming that the banking sector plays a crucial role in building a more diversified, resilient, and sustainable Kuwaiti economy by directing financing toward sectors and projects capable of supporting growth and strengthening the national economy in the long term.