08/05/2026 03:10 AST
Burgan Bank KPSC ("Burgan" or "the Bank") announced its financial results for the first quarter of 2026 (Q1'26), ended 31March2026. Burgan Bank reported revenue growth in Q1'26, supported by continued diversification of income streams. Total revenues increased by 10 percent year-on-year (y-o-y) to KD 64 million, driven primarily by non-interest income, which rose 77 percent y-o-y to KD 24 million. This reflected improved fee generation and higher cross-selling activity across the Group, with the cross-sell ratio increasing to 38 percent (+14 percentage points y-o-y).
Net interest income stood at KD 40 million, reflecting an 11 percent year-on-year decrease from KD 44 million in Q1'25, primarily due to margin pressures in a competitive interest rate environment. Notwithstanding this, the Group maintained a resilient underlying revenue base, supported by continued income diversification and strong core operating performance. Operating profit stood at KD 18 million, compared to KD 24 million in the prior-year period, reflecting a normalization from a higher base in the previous year. This was attributable to higher operating expenses resulting from the Group's continued strategic investments in digital transformation and technology infrastructure, as well as the impact of hyperinflation in its key subsidiary in Turkey.
Loan loss provisions increased by 3 percent y-o-y, reflecting a cautious approach to provisioning in light of evolving credit conditions and ongoing geopolitical developments. Additionally, tax expenses increased by approximately KD 2 million compared to the prior year, weighing on overall earnings for the period. Accordingly, the Group reported a net profit of KD 5.1 million for the quarter, compared to KD 10.7 million in the corresponding period last year. Total assets grew by 11 percent y-o-y to KD 9.5 billion, supported by expansion across key business lines. The loan portfolio increased by 6 percent to KD 4.9 billion, while customer deposits rose 13 percent to KD 6.1 billion, reflecting continued customer activity and franchise stability.
Asset quality remained broadly stable, with a non-performing loan (NPL) ratio of 2.7 percent. Net NPLs, after collateral, stood at a low 0.6 percent, affirming a conservative risk profile, while the coverage ratio reached196 percent, reflecting the Bank's continued focus on prudent risk management. Burgan maintained acceptable capital levels. During Q1'26, the Bank's Common Equity Tier 1 (CET1) ratio stood at 10.5 percent, Tier 1 capital ratio at 12.5 percent, and Capital Adequacy Ratio (CAR) at 15.9 percent, comfortably above the revised regulatory minimum requirements of 9.5 percent, 11.0 percent and 13.0 percent, respectively, as per the Central Bank of Kuwait's instruction dated March 26, 2026, introducing financial stimulus measures for the banking sector.
The Bank also maintained strong liquidity levels, with the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) at 220 percent and 111 percent, respectively, well above the minimum regulatory requirement of 80 percent, in line with the revised framework. Against a backdrop of heightened geopolitical tensions and global uncertainty affecting Kuwait and the wider region, Burgan Bank maintained a disciplined focus on operational resilience, business continuity, and safeguarding the interests of its customers, employees, and stakeholders. This approach continues to underpin the Bank's stability and ability to navigate volatility while supporting long-term value creation.
Commenting on the Bank's financial results, Burgan Bank's Chairman, Sheikh Abdullah Nasser Al-Sabah, said: "Burgan Bank's performance during the first quarter of 2026 reflects the strength of our foundations and the discipline of our strategy, particularly as we navigated a period marked by heightened geopolitical uncertainty and global volatility. Our focus remained firmly on ensuring business continuity, safeguarding our people, and protecting the interests of our customers, while maintaining stability across our operations."
He added: "This approach is rooted in our prudent risk management framework and forward-looking strategy, which continue to guide our decisions and reinforce our resilience. As we move forward, we remain committed to balancing short-term priorities with long-term objectives, ensuring that we continue to create sustainable value for our stakeholders while contributing to the stability and growth of the markets in which we operate.
On the Bank's performance and strategic priorities, Tony Daher, Group Chief Executive Officer of Burgan Bank, said: "Our performance this quarter reflects continued progress in strengthening the Bank's revenue mix, with solid growth in non-interest income and increased cross-selling supporting more diversified and sustainable income streams. During the period, margin compression and cost dynamics were key factors impacting performance, and we are actively addressing these through targeted efficiency measures, cost optimization initiatives, and ongoing investment in our digital capabilities. These efforts are aimed at enhancing operational leverage, improving performance consistency, and supporting the Bank's longer-term growth ambitions."
Reinforcing leadership
During the quarter, Burgan Bank maintained its position as a leading financial institution in Kuwait, supported by an active role in shaping market dialogue. In this context, the Bank and KAMCO Invest successfully hosted the third edition of their annual Investment Conference, bringing together regional and international investors, thought leaders, and industry experts. Discussions focused on the key global economic developments, geopolitical trends, and emerging investment opportunities. The conference continues to serve as a platform for structured dialogue and reflects the bank's role within the broader financial ecosystem.
Burgan Bank continued to advance its strategic collaboration with KAMCO Invest in the area of private banking, reinforcing its commitment to delivering integrated wealth management solutions for high-net-worth clients. This proposition was further strengthened by Burgan Bank being awarded the "Best for High-Net-Worth (HNW) in Kuwait" at Euromoney's Private Banking Awards 2026, reflecting the growing strength of its Private Banking and Wealth Management franchise, strong client service model, and continued investment in sophisticated advisory and digital capabilities.
The partnership with KAMCO Invest leverages the combined strengths of both institutions to enhance advisory capabilities, broaden access to traditional and alternative investment opportunities, and provide more tailored, cross-border wealth solutions that support clients in achieving diversified and long-term financial objectives. The Euromoney recognition also highlights Burgan Bank's success in deepening client relationships, expanding HNW assets, and strengthening its differentiated value proposition within the premium banking segment, further consolidating its position as a leading wealth management provider in Kuwait.
On the retail banking front, Burgan Bank continued preparatory work for the return of its flagship Kanz account, ensuring alignment with applicable regulatory frameworks and operational readiness. This reflects the Bank's continued focus on transparency, compliance, governance, and disciplined execution in relation to key product offerings. In addition, the Bank expanded its innovative Soft POS solution powered by KNET, enabling merchants to accept credit card payments directly through their smartphones, supporting the ongoing digitalization of payment solutions.
Burgan's Group Chief Executive Officer, Tony added, "Our continued focus on strategic partnerships and differentiated client capabilities remains central to Burgan Bank's long-term growth strategy. Our collaboration with KAMCO Invest, alongside the recognition received at the Euromoney Private Banking Awards 2026, reflects the steady progress we are making in strengthening our wealth management proposition and enhancing the value we deliver to clients."
Building Capabilities
The Bank maintained its focus on human capital development as a core pillar of its long-term strategy, achieving an 84 percent Kuwaitization rate by the end of 2025. During the quarter, the bank continued to strengthen its leadership pipeline through the development and appointment of national talents across key functions, in line withits commitment to developing future-ready capabilities and supporting Kuwait's workforce development objectives.
Driving community engagement
In line with its "Driven by You" philosophy, Burgan Bank maintained a focused yet adaptive approach to its corporate social responsibility efforts during the quarter, responding to the evolving circumstances while preserving its commitment to community engagement. The Bank leveraged its digital and social media platforms to deliver timely awareness content, focusing on public safety, financial literacy, and responsible practices.
As part of its National Day initiatives, the Bank launched its campaign "Thank You for the Good That Shaped Our Nation," anchored by a purpose-driven film that celebrated collective contribution and national identity, reinforcing its people-centric philosophy. During the holy month of Ramadan, Burgan Bank introduced its campaign "Thank You for the Challenge," delivering a message centered on resilience and growth through adversity.
The campaign was supported by a wide range of initiatives spanning humanitarian support, financial literacy, and community engagement, while adapting certain activities in line with prevailing conditions. These efforts reflect the Bank's continued commitment to its national role and responsibility, prioritizing safety, solidarity, social responsibility, and sustained community impact during a period of heightened uncertainty.
In conclusion, the Bank's Chairman, Sheikh Abdullah Nasser Al-Sabah, said: "I would like to take this opportunity to thank our customers for their continued trust, our employees for their dedication, and our shareholders for their ongoing support. Despite the uncertainties, we remain committed to ensuring that Burgan Bank delivers on its promises of long-term value to its customers, its employees, and its communities."
Kuwait Times
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