About

The National Bank of Kuwait (NBK) was established in 1952 when a prominent Kuwaiti merchant went to the British Bank of the Middle East to open a letter of guarantee for the amount of 10,000 Indian rupees, (which is equivalent today to 750 Kuwaiti dinars). Much to his surprise, his request was rejected, on the condition that he provide a guarantor. This well-known merchant was shocked and appalled by the treatment that he had received, and news of this was all over town. 

This incident gave rise to the question and the idea of having a Kuwaiti bank with a mission to serve citizens’ needs as its priority, stimulate the economic growth of the country, and look after the savings of its clients. In fact, a meeting was held with the late Amir of Kuwait, H.H. Sheikh Abdullah Al-Salem Al-Sabah, who congratulated them on the idea and promised them his complete support. An Amiri decree was issued on May 19, 1952 to open the National Bank of Kuwait, and NBK started operations on November 15th 1952.

The founders of NBK are:

• Khalid Zaid Al-Khalid
• Ahmed Saud Al-Khaled
• Khalifa Khalid Al-Ghunaim
• Khaled Abdullatif Al-Hamad
• Sayed Ali Sayed Sulieman Al-Rifai
• Yousef Abdulziz Al-Fulaij
• Yousef Ahmed Al-Ghanim
• Mohamed Abdulmohsen Al-Khorafi
• Abdulaziz Hamad Al-Sager

NBK was the first national bank in Kuwait and the entire Arabian Gulf region. All the board members and the founders of NBK were renowned merchants of Kuwaiti origin. NBK was established with a capital of 13,100 shares, each valued 1,000 Indian rupees – equivalent to 75 Kuwaiti dinars today. Over the years NBK has proved itself to be a financial leader in the Arab world.

Dear Shareholders, Investors and Partners,

As I reflect on the successful strides that we have undertaken together, I am filled with pride and gratitude for the remarkable journey, one defined not only by financial accomplishments but, more importantly, by the values that shape our identity and the commitment to ESG principles that underscore our impact on Kuwait and the world.

“Empowering Tomorrow: Navigating a Digitized and Sustainable Future”, marks our dedication to fostering innovation, cultivating environmental stewardship, and embracing technological advancements that will shape a resilient and equitable world for generations to come. We strive to harness the power of digital transformation and sustainability initiatives, working hand in hand with communities, businesses, and individuals to build a brighter and more inclusive future.

2023 was a year of challenges underpinned by local and regional regulatory tightening and political volatility in Kuwait and in the world more broadly, in addition to a slowing but still prevailing global inflation. However, our strategy demonstrated our resilience, our commitment to our customers and our promise for a trusted banking relationship. NBK managed to do well and to deliver on its promises to stakeholders. Our concerted efforts yielded in significant improvements across all key ratios compared to the previous year and demonstrated the potential and resilience of our strategy established years ago. NBK’s role as a trusted institution solidifies our position as a safe haven for investors, depositors, wealth management clientele, individuals, and corporates. 

Innovation and Diversification at the Core

This year was underscored by the launch of NBK Wealth, consolidating private banking and asset management businesses under one leadership. This transformational journey was based on the adoption of innovation as the core of our value proposition through a holistic client-centric approach. Many successes have been pinned since then, adding to our portfolio of achievements and “firsts” in Kuwait and beyond, widely recognized by prominent awards and ratings. More importantly, the prevailing success of our institution can be primarily ascribed to the tactical diversification approach we adopt at our core. By strategically diversifying our portfolio and services across different geographies, we mitigate risks and capitalize on emerging opportunities, demonstrating our commitment to adaptability and long-term stability. 

Digital Transformation 

Building on this foundation, our relentless focus on digital transformation has borne fruit. The successful digitization of our Bank and the seamless transition of our valued customers to digital banking platforms reflect our dedication to staying ahead of the curve. We take pride in our pioneering role in launching Weyay, the first digital bank in Kuwait, a testament to our commitment to trendsetting in the market since we embarked on this journey a few years ago. Our digital banking strategy has proven instrumental in customer acquisition, particularly while tapping into the tech-savvy and the youth segments, positioning us as the bank of tomorrow.

People Power 

Throughout 2023, we continued our investment in our greatest asset, our people. Our team comprises experienced, skilled, and motivated professionals who have steered our bank in the right direction, contributing significantly to our ongoing success. Recognizing the pivotal role our workforce plays, we remain deeply engaged with every function, fostering cohesive synergies both locally and internationally across the Group. Their dedication and expertise drive our daily operations and form the bedrock of our strategic initiatives, ensuring sustained growth and resilience in an ever-evolving financial landscape.

National and Ethical Excellence

Consistently, our support to national prosperity remains prime within the country’s strategic Vision 2035 framework, the Kuwait National Development Plan (KNDP), and beyond. Our continuous fulfillment of our national duty serves as a catalyst for national development. We maintained our strong relationships with regulators both in and outside Kuwait, working hand in hand with them to improve the banking and business environment. We have successfully navigated challenges in our international presence, strengthening our footprint in the 13 countries where we operate through strategic moves on both conventional and Islamic banking fronts. Our continuous expansion efforts focus on maximizing our presence and customer base across our growth markets in the MENA region while concurrently building a global network that facilitates our customers’ trade, investment, and broader banking requirements.

Looking ahead to 2024, our expansion targets Kuwait as the main market, with strategic moves into the GCC. We plan to strengthen our footprint in existing markets through strategic investments, and we eagerly anticipate government led business activity that will spur growth in the domestic banking market. We aim to implement our successful digital banking value proposition in other markets, with a keen eye on the MENA region. 

I am proud to confirm once again our unwavering commitment to the highest standards of ethics and corporate governance. Our governance framework is a dynamic and proactive system that fosters transparency, accountability, and ethical conduct at every level. The Board, in collaboration with our dedicated leadership team, ensures that strategic decisions align with our core values and serve the best interests of our shareholders. 

NBK held its 2022 Annual General Meeting (AGM) on 18 March 2023, with a quorum of 71.47%. The AGM approved the Board of Directors’ recommendation to distribute 25% cash dividends to shareholders for the second half of the financial year (25 fils per share; bringing total cash dividends for the year to 35 fils per share) in addition to 5% bonus shares (5 shares for every 100 shares owned). 

Moreover, the Board of Directors recommended the distribution of 25 fils per share for the second half of 2023, bringing the total cash dividend distribution for the year 2023 to 35 fils per share, in addition to 5% bonus shares. That brings the cash payout ratio for 2023 to 50% of the profits attributable. This step demonstrates NBK’s solid capital adequacy, confidence in its financial position, and ability to generate profits.

We are Resilient for Tomorrow and Beyond 

The year 2023 witnessed NBK’s unwavering dedication to Environmental, Social, and Governance (ESG) principles, building on the momentum gained after a landmark year in 2022. Recognizing the global imperative for sustainable growth, NBK made significant strides in ESG, earning recognition and solidifying its position as a responsible corporate entity. 

In 2022, NBK’s Executive Management approved the Group’s new ESG Strategy and key ESG strategic initiatives; while in 2023, we finalized the Bank’s ESG Governance Framework that outlines a comprehensive governance structure with specialized committees to drive ESG Strategy implementation across the Bank by assigning each ESG strategic pillar to a member of the Executive Management as key owners. It ensures utmost levels of accountability and commitment are maintained to support the Bank in achieving its ESG-related KPIs and ambitions, defining clear deliverables and milestones, and establishing accountability with the Board’s oversight to achieve our ambitions and targets.

In line with the ESG Strategy, we crafted a comprehensive 3-year roadmap, outlining key targets and commitments in areas where the Bank holds the greatest potential. This strategic framework aims to drive a sustainable and equitable transition to a low-carbon economy, delivering a positive social impact on people and communities. Our ESG Governance Structure is based on the four pillars of NBK’s evolved ESG Strategy Framework and focuses on promoting economic prosperity and serving as a model for sustainable development. The four pillars of our ESG Strategy are: Governance for Resilience, Responsible Banking, Capitalizing on Our Capabilities, and Investing in Our Communities. 

ESG has always been a key element in our strategic focus across the years. Our new ESG Strategy draws a clear pathway forward by integrating ESG into the Group’s business strategy and shifting our approach to a pro-active, stakeholder driven stance. 

Looking ahead, we acknowledge the prevailing uncertainties in the landscape. The challenges tied to political tensions and economic issues will undoubtedly test the resilience of the banking sector, challenging its capacity to support and safeguard customers. However, I assure you that our focus will be sharper, our resolve stronger, and our ambitions higher and I maintain confidence that our strategic vision and commitment to being a purpose driven business will help us navigate these challenges and fortify the long-term future of the Group, yielding benefits for all our stakeholders. 

We will embark on the next phase of our journey together, with knowledge and a sense of purpose, driven by our values and culture.

Acknowledgments 

On behalf of the Board, I would like to extend my sincere gratitude to all our stakeholders for their continued support. I would also like to thank my fellow directors and our executive management for their dedication and invaluable contributions bringing our mission to success in 2023. To our customers, we highly value your continued trust and confidence in NBK, and we are steadfast in our commitment to providing you with a valuable relationship that goes beyond bank offerings. A special acknowledgment goes to our devoted team; your dedication and tireless efforts are the backbone of our success. On a final note, thanks are also due to the Central Bank of Kuwait and the Capital Markets Authority for their persistent efforts in advancing the banking sector. To our valued shareholders, thank you for your enduring support as we strive to solidify NBK’s leadership in the Kuwaiti banking sector.

Hamad Mohamed Al-Bahar
Chairman