Burqan posts 22 million KD profit in 9 months

Burkan Bank announced its financial results for the nine-month period ended September 30, 2026, recording continued growth in its core revenue sources and further expansion in its balance sheet. This performance reflects sustained momentum across the Group’s various banking operations, supported by credit activity growth, contributions from diverse business segments, and a disciplined approach to financial center management.

While profitability remained impacted by rising operating expenses and the consequences of applying hyperinflation accounting to the Group’s operations in Turkey, Burkan Bank maintained a strong capital and liquidity position, with regulatory ratios comfortably exceeding the minimum requirements of applicable regulations.

The successful completion of a 50 million dinar capital increase, achieved through the issuance of rights shares during the period, also strengthened the Bank’s capital base and enhanced its financial flexibility, thereby supporting its ability to advance its long-term strategic priorities.

During the first nine months of the year, Burkan recorded total revenues of 201 million dinars, compared to 192 million dinars during the same period in 2025. This increase was driven by higher net interest income and continued growth in fee and commission income, reflecting sustained momentum in core banking activities, supported by loan portfolio growth and contributions from the Group’s diverse business segments.

Net interest income rose to 137 million dinars, compared to 128 million dinars during the first nine months of 2025. Meanwhile, the net interest margin remained relatively stable at 2.2%, demonstrating the Bank’s ability to maintain margin stability despite pressures surrounding interest rates.

Non-interest income remained largely stable year-on-year at 64 million dinars, with continued growth in fee and commission income, partially supported by the contribution of United Gulf Bank, which the Group acquired in 2025, and its subsidiary specializing in investment banking services, Kuwait Investment Company K.S.C.P. (KIC Invest). These fee-generating activities continued to support income diversification, complementing the Group’s core net interest income.

Operating profits for the period amounted to 65 million dinars, compared to 76 million dinars during the first nine months of 2025. The rise in operating expenses offset the impact of revenue growth, reflecting the Group’s continued strategic investments in developing digital capabilities across its operations, as well as increased operating costs resulting from high inflation levels in Turkey.

Profitability was also affected by higher net cash losses arising from the application of hyperinflation accounting to the Group’s operations in Turkey. Credit provisions remained largely stable year-on-year, consistent with the Bank’s prudent approach to credit risk management and maintaining adequate coverage levels to address potential losses. The cost of credit stood at 50 basis points, compared to 60 basis points during the same period in 2025.

Accordingly, Burkan Bank reported net profit attributable to shareholders of 22 million dinars for the nine-month period, compared to 32 million dinars during the first nine months of 2025.

Commenting on the financial results, Sheikh Abdullah Nasser Al-Sabah, Chairman of the Board of Directors of the bank, stated: “The performance of Boubyan Bank during the first nine months of 2026 reflects the robustness of our business model and the strength of the financial foundations we continue to consolidate. Amid economic changes and uncertainty at both the regional and global levels, we have continued to focus on maintaining financial stability, protecting stakeholders’ rights, and executing our strategy prudently. The continued growth in our core business demonstrates the strength of the Group’s operations and its banking standing, reinforcing our confidence in its long-term direction.”

Boubyan Bank continued to achieve growth in its balance sheet during the period, with total assets reaching KD 9.4 billion as of September 30, 2026, compared to KD 8.9 billion in the corresponding period. This growth reflects continued activity in the Group’s key operating markets, supported by the performance of its core banking business.

Total loans and advances grew by 8% year-on-year to reach KD 5.1 billion, driven by sustained credit activity, particularly in Kuwait, where the credit portfolio grew by 9%. Customer deposits also increased by 6% year-on-year to reach KD 5.5 billion, supported by a 5% growth in deposits in Kuwait.

The continued growth in loans and deposits underscores the strength of the bank’s customer base and the robustness of its core banking operations, as well as its ability to meet financing needs while maintaining a diversified funding base. The loan-to-deposit ratio stood at 78% as of September 30, 2026, remaining comfortably below the regulatory threshold of 100%.

Asset quality remained a key priority for the bank, supported by disciplined credit granting standards, a prudent provisioning policy, and effective portfolio management. As of September 30, 2026, the Group’s non-performing loans ratio stood at 2.3%, while the total coverage ratio reached 235%, reflecting the level of coverage maintained by the bank to address potential credit defaults.

The bank continued to monitor credit developments in the markets in which it operates, maintaining a balanced risk management approach that keeps pace with economic changes and market dynamics.

The bank also maintained a strong capital position, with the Common Equity Tier 1 (CET1) ratio at 10.9% and the Capital Adequacy Ratio (CAR) at 16.3% as of September 30, 2026. Both ratios remained comfortably above the minimum regulatory requirements, providing a capital buffer that supports banking activities and enhances financial resilience.

The bank maintained strong liquidity levels, with the Liquidity Coverage Ratio (LCR) at 162% and the Net Stable Funding Ratio (NSFR) at 111%, both exceeding the minimum regulatory requirements. This reflects the bank’s ability to meet its short-term obligations while maintaining a stable long-term funding structure.

Commenting on the Group’s financial position, Sheikh Abdullah Al-Nasser stated: “Our growth approach is based on prudent risk management, sound governance, and responsible capital management. Maintaining the strength of our balance sheet is essential to our ability to navigate market changes and seize strategic opportunities. The successful completion of the capital increase represents a significant step in this direction, as it enhances our financial resilience and our ability to deliver sustainable value to shareholders and the communities we serve.”

Speaking about the Group’s operational performance and strategic priorities, Tony Daher, Chief Executive Officer of Bank AlBahrain Group, said: “Our performance during the first nine months of the year reflects sustained momentum in our core banking activities, supported by growth in net interest income, continued strength in fee and commission income, alongside growth in loan and deposit portfolios. Kuwait remains a central pillar of this performance, while the integrated capabilities of our international operations continue to support our diversified business model and enhance the range of solutions we offer to our clients.”

Daher added: “Despite the ongoing impact of operating expenses and the consequences of hyperinflation accounting in Turkey on profitability, our priorities remain clear. We are focused on enhancing operational efficiency, developing our digital capabilities, and improving the consistency and sustainability of our performance. At the same time, we are leveraging the Group’s expertise and relationships to enhance the value delivered to clients, support disciplined business growth, and build a more integrated banking platform for the future.”

During the third quarter of 2026, Bank AlBahrain successfully completed a capital increase of 50 million Kuwaiti Dinars through the issuance of rights shares. The offering attracted subscriptions totaling 66.79 million, representing a coverage ratio of 134%, or approximately 1.34 times the number of shares offered.

The subscription period closed on September 14, 2026, after the issuance of 277.8 million new shares at an issue price of 0.180 KD per share, comprising a nominal value of 0.100 KD and an issue premium of 0.080 KD. Following the completion of relevant regulatory and corporate procedures, the shares were fully allocated, distributed, and issued. Consequently, the Bank’s issued and fully paid-up capital increased from 399.6 million KD to 427.4 million KD, representing an increase of approximately 7%.

The capital increase strengthened the Bank’s financial foundation and provided greater flexibility to advance its strategic priorities, including consolidating its position and operations in the Kuwaiti market, improving the asset mix, investing in digital transformation, and identifying opportunities that enable the Bank to achieve profitable and sustainable growth.

The success of the offering also demonstrated the strength of the Group’s integrated capabilities. Kamco Invest served as the offering advisor and subscription agent, leveraging its expertise in investment banking and capital markets to support the execution of the transaction.

In parallel with strengthening its capital base, Bank AlBahrain continued to advance its regional integration strategy, focusing on consolidating its presence and brand in its markets.

United Gulf Bank (UGB) completed its trade name change to become Bank AlBahrain (S.A.K.), operating under the trade name “Bank AlBahrain Bahrain.” This step marks a significant milestone in reinforcing the Bank AlBahrain brand across the Group’s regional operations and enhancing a more integrated identity in its markets. The trade name change aligns the Bank’s operations in Bahrain with the Group’s regional direction, while maintaining its specific focus on the Bahraini market and its potential, which complements the Group’s broader portfolio.

Bank AlBahrain Bahrain will continue to focus on corporate and institutional banking, while enhancing its capabilities in Islamic finance and treasury investments, alongside corporate banking services, fixed-income products, and global markets and treasury.