Structured finance isn’t just an important part of Boubyan’s corporate banking group, it is the very core.
The bank is unusual in the Kuwaiti market in having a dedicated structured finance desk able to craft and lead syndicated transactions across the region. Over the years, Boubyan, under chief executive Abdullah Al Tuwaijri, has developed a strong reputation for identifying and shortlisting participants, arranging logistics, leading negotiations and drawing up internal documents.
In Islamic finance, conducting proper due diligence – and securing credit approvals – is often more art than science. So is ensuring timely availability of funds from syndicate participants. All this while coordinating with Islamic scholars to formulate and stress-test acceptable Shariah-compliant structures.
In 2022, Boubyan worked on deals for Kuwait International Bank, the Islamic Corporation for the Development of the Private Sector, the Arab Republic of Egypt acting through the ministry of finance, and logistics company Agility.
That followed an impressive run of deals during the Covid-19-related market turmoil of 2021 and 2020. These included deals for Mazoon Electricity; Bank Muscat; Islamic Corporation for the Development of the Private Sector; Bahrain National Gas Expansion; Bahrain’s Ahli United Bank; Bahrain Telecommunications; Kuwait Petroleum Corporation; Mansher Real Estate Company; and Qatar Islamic Bank.
One 2022 deal of note involved the J3 Mall and residential area in Kuwait’s Jaber Al Ahmad City. The $500 million public-private partnership project — Kuwait’s largest-ever PPP and real-estate deal — required $300 million of financing.
What the bank lacks in scale it more than makes up for with ambition
Boubyan acted as mandated lead arranger, global agent, Islamic finance agent and security agent. It was the first time in Kuwait that an Islamic bank structured and led a local PPP transaction.
The deal was an important milestone both for Boubyan and for the broader Islamic banking sector.
What the bank lacks in scale it more than makes up for with ambition. It was incorporated in 2004 by the Kuwait Investment Authority and the Public Institution for Social Security. Two years later it was listed on Boursa Kuwait. By 2016, the central bank of Kuwait designated it a systemically important bank; by the end of 2022, Boubyan’s market capitalization was $3 billion and its total assets reached $26 billion.
The longer-term plan, Al Tuwaijri says, is for Boubyan to become one of the largest Islamic banks in the world. Acquisitions like that the Bank of London and the Middle East in 2020 should help it do just that.
