USD 300 Million, Three Year Facility
Boubyan Closes the First Sharia-Compliant Syndicated Finance Facility
Led by HSBC with Significant Participation from Leading Chinese Banks
Abdul-Salam Al-Saleh: A New Step Reinforcing Our International Presence, Opening New Horizons for Collaboration with Asian Financial Institutions
Adel Al Mutairi: Funding Diversification Boosts Liquidity Management & Growth Plans
Mohammed Al-Jaser: The Deal Lays the Foundations for a Broader Islamic Finance Collaboration and Cross-Border Transactions
Boubyan Bank has announced the successful closing of a USD 300 million, three-year Sharia-compliant syndicated facility deal, led by HSBC with significant participation from Bank of China and ICBC, in addition to Bank Islam Brunei Darussalam. This demonstrates the growing international presence of the bank and the expansion of its network with global financial institutions.
It also marks the first deal of its kind where a Kuwaiti bank secures a Sharia-compliant syndicated loan with participation from leading Chinese banks. This deal reflects one of the key pillars of Boubyan Bank’s strategy that aims to build a more diversified and sustainable international financing platform by expanding its network of global financial institutions, diversifying markets and funding sources, giving the bank more flexible options to manage its funding needs and to reinforce its ability to continue to support growth and expansion plans over the next phase.
The bank’s successful closing of this deal amid growing challenges in regional and global markets, along with interest rate fluctuations globally and the heightened levels of uncertainty reflect the solid financial position of Boubyan Bank and its efficient risk-management. This also demonstrates the reputation of the Kuwaiti banking industry among the circles of global financial institutions, as a trusted partner in cross-border finance transactions, thanks to its advanced regulatory frameworks and sound governance.
** Growing International Presence
Commenting on this deal, Boubyan Bank's Chief Executive Officer, Mr. Abdul-Salam Al-Saleh, said: “The closing of this finance deal marks the first deal of its kind where a Kuwaiti bank secures a Sharia-compliant syndicated facility with participation from leading Chinese banks. This reflects the bank’s success in expanding its global footprint and ability to transform relationships with global financial institutions into finance partnerships that serve the bank’s long-term goals. Diversification of our international partner network has become key element of the bank’s strategy that aim to foster growth and its ability to seize opportunities in global markets.”
He added: “The participation of leading Chinese banks in this deal, led by HSBC, alongside other global and Asian financial institutions, carries significance beyond the finance transaction itself. It reflects the growing international interest in the Islamic finance model, highlighting the ability of Kuwaiti banking institutions to build deeper financial relationships with major Asian economies. It also serves as a testament to Boubyan Bank’s solid financial position, with its advanced institutional standards enabling it to participate in cross-border transactions that meet the needs of financial institutions and investors; this opens new horizons for financial and investment collaboration between both.”
Al-Saleh explained: “We consider this deal a foundation for expanding our international collaboration network and developing banking relationships that we can build on in the areas of finance, investment, and syndication over the coming years. Boubyan will continue to leverage its position and expertise in the Islamic banking industry to develop finance partnerships that keep up with rapid transformations in the global economy, promote sustained growth, and strengthen our role as a Kuwaiti banking institution with growing regional and international presence.”
** Diversification of Funding Sources
Boubyan Bank’s Chief Treasury Officer, Mr. Adel Al Mutairi, said: “Managing finance structuring at Boubyan Bank is built on balancing the diversification of sources, maturities, and cost. This strengthens our liquidity profile and reinforces the bank’s ability to meet the needs of its business and its future plans efficiently. Expanding the geographic distribution of financing institutions boosts the bank’s flexibility, especially amid the rapid transformations witnessed in global markets.”
Al Mutairi added: “The arrangement of the finance — with participation from financial institutions from various markets, offers an additional medium & long-term funding channel to the bank, providing the bank with greater flexibility in managing its liabilities and optimizing its maturity profile to align with the growth of the bank's assets and its business needs. This also strengthens the ability of the Treasury Group to deal flexibly with fluctuating liquidity and return levels in money markets and stock exchange markets, maintaining an approach that balances cost and hedging against the risks of fluctuating returns.”
He emphasized: “The successful closing of this deal highlights Boubyan’s access to a wider spectrum of international financial institutions, in addition to closing Sharia-compliant syndicated finance deals in line with international market standards. The Treasury Group will continue to diversify funding sources and instruments, and to avail available opportunities in regional and international markets to strengthen the bank’s financial position and ensure a stable and sustainable funding base to continue with the bank's growth plans.”
** Sharia-Compliant Funding Structure
Mr. Mohammed Al-Jaser Al-Ghanim, GM - Corporate and International Finance, said: “The significance of this deal goes beyond the size of the deal and its parties. It is about succeeding in bringing different financial institutions from different markets to work together as part of a Sharia-compliant finance structure, reflecting the development of Islamic finance and its appeal to global financial institutions, including Chinese banks.”
He added: “The participation of a number of leading Chinese banks in this deal strengthens the banking relationships between financial institutions in Kuwait and Asia, opening the horizon for more collaboration opportunities in the areas of syndicated finance, structured finance, and cross-border transactions, expanding business horizons over the next phase.”
Al-Jaser concluded: “Boubyan Bank continues to expand its presence in international finance by building corporate partnerships built on expertise and the ability to arrange sophisticated finance structures that meet the needs of all parties. This deal will cement our position as a regional banking partner with advanced capabilities to structure and arrange Islamic finance solutions.”
