National Bank of Kuwait’s (NBK) 10 per cent rights issue closed five times oversubscribed on 21 October.

Kuwait’s largest lender said the rights issue, to raise capital to KD360m ($1.3bn), was 553 per cent covered and priced at KD0.5 per share, according to a statement published on 23 October.    

The subscription period began on 5 October.

“This comes as a confirmation of the confidence NBK has among shareholders and investors despite the global financial crisis,” NBK said in the statement.

The capital increase is intended to support expansion plans both inside and outside of Kuwait, as well as developing its lending portfolio and its role in the financing of economic projects both within Kuwait and across the region.

“Our revenues from outside Kuwait currently comprise 22 per cent and we aim to reach 50 per cent in five years,” said Ibrahim Dabdoub, NBK’s chief executive officer, at a shareholder’s meeting in March when the plan was approved.

On 22 March 2010, the bank obtained approval from the Central Bank of Kuwait to increase its 40 per cent stake in Kuwait’s Islamic lender Boubyan Bank to as much as 60 per cent. In mid-April, it raised its stake to 46.6 per cent.  

NBK also said on 6 April that it was considering buying a stake in Turkey’s Garanti Bank, citing the country as having one of the most-attractive banking sectors. It is also looking to launch operations in Syria through a new lender within one year.

The bank is targeting a 10-15 per cent increase in net profit in 2010.