Sunday 24 June 2018

Burgan seeks bond deal to raise capital

Kuwait, April 15, 2014

Kuwait's Burgan Bank is said to have hired HSBC, Kamco and NBK Capital for a potential bond deal, according to bankers.

It is not clear at this stage if the planned deal will be in US dollars or Kuwaiti dinars, nor whether it will be senior or subordinated, though the latter seems more likely.

Burgan Bank, rated A3/BBB+, is one of two Kuwaiti lenders that has been planning to issue subordinated debt, the other being Gulf Bank.

Burgan Bank wants to raise more capital this year to comply with the Basel III requirements, while any acquisitions are unlikely to come soon, the lender's chief executive said last month.

The increase, which may happen in the third or fourth quarter of this year, could be "pure capital" or perpetual bonds or both, chief executive Eduardo Eguren said, depending on discussions with regulators and shareholders.

"We are discussing this with the central bank - I know that we may need to increase capital by 20 to 30 per cent for sure," he said. The bank has a total capital ratio of 15.4 per cent and a Tier 1 capital ratio of 9.9 per cent.-Reuters

Tags: Kuwait | Burgan Bank |

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