Kuwait Finance House: Our strong financial performance confirms our ability to handle challenges
Kuwait Finance House (KFH) held its analytical conference on the performance and results of the Group for the first half of 2026, with participation from Group Chief Executive Officer Khaled Yousef Al-Shamlan, Group Chief Financial Officer Abdul Karim Al-Samdan, and Group Strategy Head and Acting Head of International Banking Services Eng. Fahad Khaled Al-Muhezeem.
**Khaled Al-Shamlan, Group Chief Executive Officer:**
The CEO of Kuwait Finance House Group, Khaled Al-Shamlan, opened the session by highlighting the Bank’s financial performance, stating: "The Bank achieved net profits for the first half of 2026 amounting to 363.1 million Kuwaiti Dinars, representing a growth rate of 6.1% compared to the first half of 2025. Earnings per share reached 18.86 fils for the first half of 2026, a growth of 4.9% compared to the same period last year. Net financing revenues rose during the first half of 2026 to reach 649.4 million Kuwaiti Dinars, a growth of 6.9% compared to the same period last year. Total operating revenues, supported by growth across all key activities, reached 990.5 million Kuwaiti Dinars, a growth of 9.9% compared to the same period last year.
The cost-to-income ratio improved to 30.6% during the first half of 2026, compared to 34.3% in the corresponding period last year, reflecting our commitment to efficiency and operational excellence. Net operating revenues for the first half of this year also rose to 687.9 million Kuwaiti Dinars, achieving a growth of 16.2% compared to the same period last year. The growth achieved in our financial indicators during the first half of this year reflects the Group’s continuous ability to deliver balanced growth, despite the rapid changes and challenges facing the operating environment at both the regional and international levels."
**Strategic Developments**
Al-Shamlan added: "Kuwait Finance House continues to strengthen its financial position. Total assets reached 42.2 billion Kuwaiti Dinars by the end of the first half of 2026, a growth of 9.7% compared to the end of the same period last year. Financing receivables stood at 22.8 billion Kuwaiti Dinars, an increase of 11.5% compared to the end of the first half of 2025. Customer deposits reached 21.6 billion Kuwaiti Dinars, a growth of 9.4% compared to the first half of 2025. Meanwhile, total shareholders’ equity stood at approximately 5.8 billion Kuwaiti Dinars, an increase of 4.2% compared to the same period last year. The capital adequacy ratio reached 17.47%, exceeding regulatory requirements, which confirms the strength and robustness of the Bank’s capital base.
In line with our ongoing commitment to enhancing value for shareholders, the Board of Directors has recommended the distribution of interim (half-yearly) cash dividends of 10 fils per share, thereby reinforcing shareholder confidence through sustainable and long-term returns."
**Market Position and Global Recognition**
Al-Shamlan stated: "Kuwait Finance House continues to consolidate its leading position and exceptional business volume, enhancing the Group’s distinction regionally. The Bank ranked first locally and 12th regionally on Forbes’ list of the top 100 public companies by market capitalization. KFH’s market capitalization reached 14.1 billion Kuwaiti Dinars by the end of the first half of 2026.
We are also leveraging our international network, which comprises over 600 branches across 10 countries, to capture cross-border opportunities, finance strategic infrastructure projects, and support small and medium-sized enterprises, thereby strengthening KFH’s position as a trusted partner in supporting economic growth across all our key markets."
**Social Responsibility and Sustainability**
Al-Shamlan emphasized that Kuwait Finance House works to translate its social responsibility programs into national initiatives with tangible impact. The Bank’s partnership with the Ministry of Justice, since 2019, has contributed approximately 61 million Kuwaiti Dinars to assist citizens struggling to repay their debts. The Bank has also expanded its strategic partnerships with ministries responsible for education, youth affairs, health, justice, and social affairs, enhancing its role as a national partner in achieving sustainable community development.
In recognition of these efforts, Kuwait Finance House won the "Best Islamic Bank for Social Responsibility in the World 2026" award from Global Finance magazine.
**Operational Efficiency and Innovation**
Al-Shamlan said: "Digital transformation is a cornerstone of KFH’s growth strategy. Our platform currently processes over 600 million digital transactions annually, contributing to enhanced customer engagement, improved operational efficiency, and risk management. In this context, the Bank is investing in the qualification and preparation of national talent for the future, as evidenced by 100 employees obtaining specialized professional certifications through the 'Injaz' scholarship program.
Moving forward, and despite recent geopolitical challenges, KFH will continue to focus on its strategic priorities: enhancing asset quality, improving financial performance and Group business integration, developing digital infrastructure, and elevating the customer experience, all within a robust risk management framework. We are committed to maintaining our strong financial position while seizing market opportunities to drive future growth."
Concluding his remarks, Al-Shamlan said: "Our strong financial performance during the first half of 2026 reflects the effectiveness of our strategies and our ability to navigate challenges amidst the rapid changes in the banking sector and the regional landscape."
**Abdul Karim Al-Samdan, Group Chief Financial Officer:**
The Group CFO, Abdul Karim Al-Samdan, stated that the financial performance of Kuwait Finance House Group for the first half of 2026 demonstrated strong growth in its core banking activities, highlighting key financial performance indicators.
Regarding the key financial results for the first half of 2026, Al-Samdan noted that operating revenues grew at a faster pace than net profit attributable to shareholders, with a portion of this growth allocated to prudent provisions. The financial position has also become more productive due to the redeployment of surplus liquidity.
The Group’s wide geographic footprint serves as a supporting element for resilience, as the operating platform currently benefits from a broader and more diversified income base, supported by business volume, operational efficiency, and contributions from multiple markets. Management is focused on maintaining this level of returns through disciplined financing growth, effective financing and margin management, enhanced productivity, and prudent capital allocation.
Al-Samdan pointed out that international operations accounted for 39.4% of financing and 47.4% of deposits. The key point is that no single geographic market is the sole driver of the Group’s profits. Al-Samdan emphasized that this diversity in income sources creates sustainable value only when coupled with a highly efficient and productive operating platform, which the Group pursued by reducing operating expenses by 2.1% to 302.7 million Kuwaiti Dinars.
Al-Samdan also clarified that the credit provision balance is as important as the provisions charged during the current period. The balance of expected credit losses under International Financial Reporting Standards (IFRS) amounted to 525.1 million Kuwaiti Dinars. The provision balance according to Central Bank of Kuwait (CBK) directives stood at 1,029.1 million Kuwaiti Dinars, providing a buffer of 504.0 million Kuwaiti Dinars.
Regarding liquidity indicators, Al-Samdan explained that they reflect a comfortable margin, while management focuses on the cost of liquidity and its economic deployment efficiency. The liquidity coverage ratio stood at 202.1%, the net stable funding ratio at 123.5%, and the financing-to-deposits ratio in Kuwait at 81.8%, compared to current CBK requirements of 80%, 80%, and a maximum of 100%, respectively.
Furthermore, the Common Equity Tier 1 ratio stood at 13.5%, the Tier 1 capital ratio at 15.7%, and the total capital adequacy ratio at 17.5%, exceeding current requirements of 10.5%, 12.0%, and 14.0%, respectively.
He added, "We manage capital to support risk-adjusted return-based growth, enhance resilience to stress, and provide appropriate distributions. The Group maintains a margin of approximately 350 basis points above the current minimum total capital requirement, providing the capacity to continue profitable growth."
**Fahad Khaled Al-Muhezeem, Group Strategy Head and Acting Head of International Banking Services:**
For his part, Eng. Fahad Khaled Al-Muhezeem, Group Strategy Head and Acting Head of International Banking Services, outlined the key features of the economic landscape in Kuwait, along with the strategic progress achieved by the Bank during the first half of 2026. He stated: "Mid-year, the global economy continues to demonstrate its resilience. The International Monetary Fund (IMF) projects global economic growth of 3.0% in 2026 and 3.4% in 2027, accompanied by a decline in inflation rates during 2027. Although trade growth may slow in 2026, future outlooks point to a gradual recovery supported by disciplined fiscal and monetary policies.
Regarding Kuwait’s economic outlook and projects, Al-Muhezeem said: "The Kuwaiti economy is expected to trend toward gradual improvement following a period of calm in the first quarter. IMF indicators suggest growth recovery reaching 2.8% in 2027. Project activity serves as a major driver for this growth, following the signing of contracts worth $2.0 billion during the second quarter, alongside a pipeline of major upcoming projects, which drives economic activity and financing opportunities.
On the monetary environment and banking sector, he noted that the Central Bank of Kuwait maintained the discount rate at 3.50% during the first half of 2026. With inflation stabilizing at moderate levels of 2.2% in June, the IMF expects average inflation to reach 2.8% for 2026.
**Strategic Priorities**
Al-Muhezeem added: "In light of these developments, Kuwait Finance House has maintained its strong position, relying on its robust financial balance sheet, prudent risk management, revenue diversification, and wide regional presence. Entering the second half of the year, the KFH Group retains the flexibility and capacity to support customers and finance the real economy.
Kuwait Finance House continued to implement its strategic priorities during the first half of the year, launching banking services via WhatsApp and enabling over 200 banking services through the 'KFHOnline' application. The KFH Group also expanded its range of savings solutions dedicated to education, retirement, entrepreneurship, and home ownership.
Al-Muhezeem emphasized that KFH continues to translate its digital strategy into tangible developments in customer experience and service execution speed and efficiency. In recognition of these efforts, the Bank won the 'Best Digital Bank in Kuwait 2026' award from Euromoney.
The Group also strengthened cooperation among its branches in Turkey, Bahrain, Egypt, and the United Kingdom by linking technical systems and harmonizing risk policies, which contributed to expanding its financing for infrastructure, energy, and real estate development projects. Based on these achievements, the Bank won the 'Best Provider of Islamic Project Finance in the World 2026' award from Global Finance.
Regarding global awards, Al-Muhezeem confirmed that Kuwait Finance House secured more than 25 awards and rankings during the first half of this year, recognizing its excellence across all banking sectors. These include the 'Best Islamic Bank in the World' from Global Finance, 'Best Digital Bank in Kuwait' from MEED, 'Best Private Banking Services Bank' from Euromoney, and 'Best Islamic Bank for Corporate Banking Services in the World' from Global Finance, among many other global recognitions that reflect the Bank’s leading global position.
Concluding his remarks, Al-Muhezeem stated: "The first half of 2026 results demonstrated strong financial solvency, operational diversification, and execution discipline. Kuwait Finance House moves into the second half of the year backed by strong capital, a growing digital system, and clear priorities, with a firm commitment to supporting Kuwait’s development journey and achieving maximum sustainable long-term value for shareholders."
