BANK OF BAHRAIN AND KUWAIT (BBK)

Bank of Bahrain and Kuwait (BBK)

Bank of Bahrain and Kuwait (BBK)

Foreign ownership is more limited in the GCC banking sector than in other emerging markets. While several international banks are active in this region? they do not represent a material share of the domestic markets? with the notable exception of Saudi Arabia. For instance? until recently foreign banks were not allowed in Kuwait? while in Saudi Arabia no foreign bank has a majority ownership but several major domestic players such as Saudi Hollandi Bank (SHB)? Saudi British Bank (SBB)? and Al Bank Al Saudi Al Fransi (BSF) have active minority foreign shareholders.

Foreign banks have been operating in the GCC region with their regional counterparts for a number of years. In Bahrain? Oman? UAE and Qatar? international banks have been operating freely? but Saudi Arabia and Kuwait have recently started receiving international banks with open arms. The Saudi Arabian Monetary Agency issued licences to National Bank of Kuwait? National Bank of Bahrain? J.P. Morgan and Deutsche Bank. Similarly? Kuwait has also liberalised its banking system and issued licences to foreign banks. France's BNP Paribas won the first licence in August 2004. Following that decision Central Bank of Kuwait (CBK) has also given approval to the National Bank of Abu Dhabi and HSBC Bank Middle East to open branches in Kuwait.

Also? in September 2005? CBK had decided to give its initial approval to licensing a fourth bank? Citibank. More licences are expected in the next year as other international banks such as Britain's Standard Chartered are believed to have applied for Kuwaiti licences. The potential business segments lure many foreign banks to enter the banking industry in the region.

The banking sector in the region has witnessed tremendous developments in recent past. Bahrain? Dubai and Qatar are developing dedicated ...