Al-Saqr: NBK Continues Strong Performance Thanks to Diverse Business Model and Wide Geographic Reach

National Bank of Kuwait held its analysts and investors conference for the financial results of the third quarter and the first nine months of 2026. Mr. Issam Jasim Al-Saqer, Vice Chairman and Chief Executive Officer of National Bank of Kuwait Group, presented the business environment, key milestones, and achieved financial results, alongside local, regional, and global economic outlooks.

Mr. Al-Saqer began by highlighting the bank’s financial performance, noting that National Bank of Kuwait achieved a net profit of 481.7 million Kuwaiti dinars in the first nine months of 2026, compared to 467.4 million Kuwaiti dinars during the same period in 2025.

He added that net operating income rose by 3.8% year-on-year, surpassing 1.0 billion Kuwaiti dinars, emphasizing that this growth reflects the strength of the bank’s diversified business model and its wide geographical footprint, while also supporting the bank’s robust performance despite challenges in the operating environment.

Mr. Al-Saqer pointed out that return indicators remained strong, with the return on average assets reaching 1.39% during the first nine months of the year, while the return on average shareholders’ equity stood at 13.9%.

On the strategic front, Mr. Al-Saqer reported the bank’s continued significant progress in implementing digital transformation plans and enhancing innovation capabilities. He noted that during the third quarter of 2026, the scope of integrated digital services expanded to include more key products in the retail banking sector, including the launch of Kuwait’s first fully integrated digital experience for loan applications, the availability of opening bank accounts for children, and the digital application and issuance of credit cards.

He stressed that diversifying the Group’s business activities and revenue sources remains a key pillar of the bank’s strategy, leveraging its regional and international presence, the wealth management sector, and Boubyan Bank – the Group’s Islamic banking arm.

He clarified that during the third quarter, the bank expanded its presence in the Gulf region by opening a branch in the Qatar Financial Centre, strengthening relationships with clients in a market where “Al-Watani” has had a long-standing presence for many years.

Regarding sustainability, Mr. Al-Saqer confirmed the continued integration of Environmental, Social, and Governance (ESG) criteria into the Group’s business and operations. He noted that by September 2026, the bank had achieved 60% of its target for sustainable financing, which stands at 10 billion US dollars by 2030, reflecting efficient implementation and the bank’s commitment to achieving long-term sustainable growth.

Regarding future expectations, Mr. Al-Saqer affirmed that the bank’s strong position and outstanding performance form a solid foundation for continued growth and enhancing “Al-Watani’s” market leadership. He explained that the bank’s strong capital base and robust liquidity levels provide it with the capacity to expand lending activities in tandem with economic recovery, while established and trust-based relationships with the public and private sectors continue to reinforce the bank’s position at the forefront of financial institutions supporting Kuwait’s investment plans, infrastructure projects, and economic transformation.

Regarding the Kuwaiti economy, Mr. Al-Saqer clarified that economic activity in the country regained momentum after the slowdown witnessed during the second quarter of the year. Oil production recovered significantly compared to previous low levels, although it remained below pre-conflict levels. The pace of its recovery in the coming period will depend on export conditions.

For its part, he noted that non-oil activity demonstrated greater resilience, supported by progress in implementing the development agenda and a noticeable recovery in the pace of tenders for public utilities, infrastructure, and energy sectors.

Al-Saqr stated that the past period of the year saw tangible progress in legislative and economic reforms, adding that these developments, along with Kuwait’s strong financial position, received positive assessments from credit rating agencies, which helped stabilize the country’s sovereign credit ratings.

Al-Saqr pointed to the approval and publication of the mortgage financing law in the Official Gazette, pending the issuance of its executive regulations in the near future.

He predicted that lending activity under the recently approved mortgage financing law would gradually grow, noting that the true growth potential would become evident in the longer term as more ready-to-distribute housing units become available.

He added that, independently of the law’s scope, lending activity is expected to improve as more business is directed toward implementing infrastructure projects and developing these new cities.

Al-Saqr reported that project award activity maintained its momentum, with the total value of awarded projects reaching approximately 3 billion Kuwaiti dinars during the first nine months of 2026. The third quarter also saw significant international investments attracted to Kuwait’s infrastructure sector, which he considered a strong indicator of investor confidence in the country. He emphasized that investment activity prospects remain promising amid the continued issuance of more tenders and expectations of additional project awards.

For his part, Mr. Sujit Rongy, Chief Financial Officer of NBK Group, stated that the Group continued to deliver strong financial and operational performance during the first nine months of 2026, despite ongoing economic uncertainty and escalating regional geopolitical tensions since late February. He affirmed that the Group’s robust business model, diversified revenue streams, and geographic presence contributed to enhancing its ability to withstand challenges and maintain strong profitability levels.

He clarified that the Group achieved a net profit of 481.7 million Kuwaiti dinars during the first nine months of the year, representing a 3.1% increase compared to the same period last year. Net profit for the third quarter reached 156.9 million Kuwaiti dinars, also up by 3.1%, supported by stable operational performance and a relative decline in net credit loss and impairment provisions.

Rongy added that net operating income rose to 1 billion Kuwaiti dinars, reflecting a 3.8% year-on-year growth, driven by the strong contribution from non-interest revenue sources, which accounted for 25% of total operating income, reflecting continued balance in the revenue structure. He noted that non-interest income increased by 14.2% to reach 251.4 million Kuwaiti dinars, while fee and commission income grew by 11.9% to reach 181.6 million Kuwaiti dinars, reflecting strong contributions from various business segments and markets in which the Group operates.

Ronghi stated that the growth in fee income was primarily driven by asset management, lending, and card activities, while card revenues in the third quarter benefited from increased travel and air traffic during the summer season. Additionally, foreign exchange trading profits of 40.7 million Kuwaiti dinars supported revenues, benefiting from improved transaction volumes and positive changes in exchange rates.

He noted that international operations and Islamic banking, which are the two main pillars of the group’s business diversification, contributed together to approximately 39% of the group’s total profits, reflecting the success of the geographic and operational diversification strategy adopted by the bank.

Ronghi clarified that the continued issuance of Kuwaiti dinar-denominated government treasury bills contributed to a gradual increase in the interest-bearing reserve ratio at the Central Bank of Kuwait, which had a somewhat positive impact on net interest income and net interest margin. He expressed the bank’s hope that the continued issuance of debt instruments would enable it to deploy liquidity in assets offering better returns at the Central Bank of Kuwait.

Regarding the balance sheet, he mentioned that the group’s total assets reached 46.9 billion Kuwaiti dinars by the end of September 2026, representing a 4.5% year-on-year increase. Total loans and advances rose by 8.2% year-on-year to reach 28.2 billion Kuwaiti dinars. He explained that loan growth was primarily driven by the Kuwaiti market, with contributions from overseas operations despite challenges posed by regional conditions. Meanwhile, customer deposits grew by 13.5% year-on-year, with growth coming from both the domestic and overseas markets, although Kuwait accounted for the largest share of this increase.

He emphasized that asset quality remained stable, with the non-performing loan ratio staying at a low level of 1.29%, while the non-performing loan coverage ratio stood at 236%, reflecting the group’s prudent approach to risk management and provision building.

Ronghi pointed out that the bank holds credit provisions amounting to 940 million Kuwaiti dinars, in line with Central Bank of Kuwait regulations, against expected credit loss requirements of 713 million Kuwaiti dinars. Consequently, provisions recorded on the balance sheet under Central Bank of Kuwait regulations exceed expected credit loss requirements by 227 million Kuwaiti dinars, providing a comfortable safety margin that enables the group to absorb any potential negative impacts arising from current conditions.

He added that the group maintained healthy liquidity levels in accordance with Basel III requirements, with a liquidity coverage ratio of approximately 163% and a net stable funding ratio of 107%, both exceeding the original minimum regulatory requirements.

Regarding the outlook, Ronghi affirmed that the bank maintains a cautiously optimistic view regarding the stability of the operating environment in general during the upcoming quarters, despite ongoing challenges.

He noted that loan growth forecasts for 2026 remain within the mid-to-high single-digit range, emphasizing that the overall quality of the National Bank of Kuwait’s credit portfolio remains strong.

Ronghi anticipated that recoveries recorded during the first nine months of 2026 would help reduce the net provisions charged against the full-year results.