Kuwait investment firm refinances debt

17 August 2015

Islamic facility from bank consortium

  • Kuwaiti National Industries Group refinances KD105m ($347m) of debt
  • Islamic financing arranged by existing lender, local Warba Bank

Kuwait’s National Industries Group (NIG) has secured KD105m ($347m) in Islamic financing from a consortium of local, GCC and international banks.

The consortium was led by local Warba Bank, which contributed KD14m of the facility.

The finance has a three-year term, and refinances existing debt.

NIG struggled to repay a $475m sukuk (Islamic bond) in 2012. However, plans to extend the sukuk to 2016 were dropped when Warba Bank arranged a KD100m three-year syndicated Islamic finance facility.

Investment firm NIG is part of one of Kuwait’s largest family-owned conglomerates, al-Kharafi Group. It was one of a number of Kuwaiti investors to struggle to repay debt following over extension in the run-up to the 2008 financial crisis.

NIG made a KD37m profit in 2014, up 121 per cent on its 2013 profits. Its share price on the Kuwait Stock Exchange has fallen 1.2 per cent on the refinancing news.

The fast-growing Warba Bank increased its net profits by 633 per cent year-on-year in the first half of 2015 to reach KD315,000. It expects to report KD1.5m in arranging fees for the third quarter.

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