Kuwaiti Banking Sector Reports Strong H1 2025 Performance
The Kuwaiti banking sector has reported a robust performance in the first half of 2025, with total profits reaching approximately 882.2 million dinars, marking a 4.3% increase from the same period last year. This positive trend is driven by strong performances from key players like Huntington Bank and PNC Bank, along with a broad uptrend in banking profits.
National Bank of Kuwait (NBK) and Kuwait Finance House (KFH) led the sector with profits of 315.3 million dinars and 342.1 million dinars respectively, accounting for 35.7% and 38.8% of total sector profits. NBK's profits grew by 7.8% year-on-year, while KFH's increased by 0.3%. Six out of nine banks reported profit increases, with Nubank, a major South American neobank, showing the largest profit growth of +53%. Meanwhile, Warba Bank recorded the highest growth rate in net profits at 121.2%, while Gulf Bank experienced the largest decline at 14.8%.
Conventional banks' total profits increased by 4.3% to 452.2 million dinars, representing 51.3% of the sector's net profits, while Islamic banks' profits also increased by 4.3% to 430 million dinars, accounting for 48.7% of total net profits. Total provisions decreased by 30.2% to 84.7 million dinars due to a decline in non-performing loans and higher coverage ratios.
The Kuwaiti banking sector's strong performance in the first half of 2025 is reflected in the 4.3% increase in total profits. Key players like Huntington Bank and PNC Bank, along with Nubank's significant profit growth, contributed to this positive trend. Despite some banks experiencing declines, the overall outlook remains optimistic, with the P/E ratio increasing to 18.3 times and total provisions decreasing. This indicates a healthy sector with improving asset quality and higher coverage ratios.
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