Central Bank of Kuwait asks Islamic banks to provide reports about shares, plots, houses

KUWAIT CITY - The Central Bank of Kuwait has asked Islamic banks to provide it with reports about the shares, plots and residential houses, the ownership of which were transferred to the banks as debt settlements, reports Al-Rai daily quoting informed sources.

They explained that the banks must refer quarterly reports in this regard to the Central Bank of Kuwait from March 2018 in order for the latter to be able to follow up the banks’ commitment to the relevant regulations.

The reports have to be sent within ten days after the end of the period required for completing the report. The Central Bank of Kuwait referred Article 99 of Law No. 32/1968 concerning organizing the banking profession. This article bans Islamic banks from possessing plots and residential houses under any case except when a client fails to fulfill his responsibilities he owe the banks.

In such case, the Islamic banks have to sell the plots and residential houses, which they took possession of as settlement of clients’ financial commitments, within three years. This period however can be extended for another year with the approval of the Central Bank of Kuwait.

As per the amendments made by the Central Bank of Kuwait concerning the shares owned by Islamic banks as settlement of clients’ debts, the banks have to provide to the Central Bank of Kuwait details concerning the client such as his name, the debt amount, number of shares and the value of each share at the time the banks took possession of it along with their current value