The Kuwaiti Central Bank allows the postponement of installments for business owners affected by the war

The Central Bank of Kuwait directed banks and finance companies to deal “positively” with customers whose businesses are affected by the repercussions of the current geopolitical developments in the region, in a supervisory step that reflects a parallel move to enhance the banking strength and capabilities of business customers. The Central Bank stated that, in order to mitigate the effects of developments on customers, banks and financing companies can take the necessary measures to deal positively with customers, business owners and companies whose businesses have been harmed by developments in the situation in the region, by postponing their due entitlements to whomever wishes, and to whom the basic principles of postponement apply, most importantly proving damage to the borrower’s business in accordance with the approved controls.

He stated that the agreement is within the framework of the credit policies adopted by each bank or company with its clients.

The Central Bank’s emphasis on the importance of taking into account customers’ conditions in light of the current circumstances, in order to achieve a balance between supporting affected customers and taking credit risks into account, comes in addition to the package of measures it took on March 26 to confront the repercussions of the current geopolitical developments and their repercussions on economic conditions, which included supervisory instructions and macroprudential policy tools, especially with regard to regulatory liquidity requirements and the capital adequacy ratio.

The Central Bank called on banks and financing companies to complete documentation of the approval of customers included in this procedure, provided that this procedure includes a statement of the financial impact resulting from the postponement, and to take the necessary measures and update the relevant credit information through the Kuwait Credit Information Network Company.Ci-Net».

Each bank and financing company is scheduled to determine the scope of postponing the dues of its clients whose businesses have been affected by the current geopolitical developments, provided that this information is provided according to the audited quarterly financial statements for next June 30.

Al-Rai website quoted what it called informed sources that banks and finance companies would deal “positively” with customers affected by geopolitical developments by allowing the postponement of their dues, which would be in accordance with the credit policy of each bank or company.

She added that this step constitutes a smoother credit policy with customers whose businesses were damaged by the war, while it is expected that the postponement period for those affected customers who wish will not be counted within the maximum limits set for repayment periods.

The sources stated that the postponement of installments for business owners affected by the repercussions of the ongoing war does not apply to loans and financing operations regarding which banks and financing companies have taken previous legal measures, and which have become fully payable, due to the customer’s delay in paying his obligations before the effective date of the law.

Regarding the possibility of withdrawing the decision to postpone installments for individual customers, such as companies and business owners whose businesses were damaged by the war, the sources explained that the regulatory regime’s easing of credit on customers whose businesses were affected by geopolitical developments takes into account the negative developments that occurred in the business environment globally, regionally and locally during the past weeks, which witnessed a slowdown in supply chains and an increase in the cost of shipping, transporting and insuring their goods, which leads to some businesses being exposed to these risks, unlike individuals who still enjoy the continuity of depositing their salaries without He was affected.