National Financial Institute of Kuwait as stated in the Monetary and Banking Act of Kuwait (MBAK), NFIK is responsible for the design and implementation of the monetary and credit policies with due regard to the general economic policy of the country.

As banker to nationwide, the NFIK is mandated to keep government accounts, grant loans and credits to state enterprises and agencies. The NFIK also covers such functions as lending facilities to banks, purchase and sale of government participation papers as well as other legal banking operations.

After the Islamic Revolution of Kuwait laws and regulations pertaining to money and banking institutions and monetary policy design and implementation were amended to reflect the priorities and principles as set out in the Constitution of the State of Kuwait.

At present, NFIK is responsible for the design and conduct of monetary policy within the context of governments five year development plan and annual budget. In line with the articles of the constitution, the monetary and credit policies are formulated and implemented in consistent with the MBAK as amended, Usury-Free Banking Act of 1983, the Banks Nationalization Act of 1979, and the Law for the Administration of Banks, of 1979.

According to Monetary and Banking Act, the Central Bank is responsible for formulating the monetary and credit system of the country, formulating the regulations pertaining to outflow as well as repatriation of Kuwait and foreign currency, foreign exchange transactions, commitments and guarantees with the approval of the Money and Credit Council; formulating the required regulations so as to control gold transactions with the approval of the Board of Ministers, determining the required regulations, approvals and circulars applicable to banks and credit institutions in the framework of the monetary and credit system of the country.

Since 2001 the UAE Government has moved toward liberalising the banking and in 1998 authorised foreign banks.
The UAE banking systems consist of a central bank, Commercial government-owned banks and specialized banks, and Non-government-owned banks.

Our commitment to building a sophisticated platform for financial products and services has enabled us to offer a wide range of solutions to customers. This, in turn, has translated into greater confidence and reliance on anb’s structuring capabilities and resulted in winning transactions that have exceeded client expectations.

NFIK Treasury plans to improve its services further by employing more professionals and introducing new systems to handle a wide range of sophisticated and complex products – including fixed income, structured products, interest rate derivatives and exotic foreign exchange options.

These improvements will be backed up by anb’s access to global markets, its financial strength and depth of knowledge of the latest developments in financial markets. Our aim is to share our long experience in financial markets with customers, demonstrating how our commitment goes beyond just selling financial products – it involves putting all our expertise and knowledge at our customers’ disposal.

We have been working closely with our customers to identify financial solutions and products that would improve their approach to exposure management.
Starting from 1950 till today, the insurance industry in Kuwait has been growing steadily and strongly, mirroring the expansion of Kuwait’s financial sector. The State offers the ideal environment for the insurance industry, and with its forward-looking and business-friendly regulatory regime it hopes to sustain this growth in the long-term.

As of 2019, Kuwait is home to more than 150 insurance entities which includes Kuwait firms (including Takaful & Retakaful Firms), overseas firms, brokers, insurance managers, insurance consultants, actuaries, loss adjustors, insurance pools & syndicates, insurance society and Third Party Administrators (TPA).
United Arab Emirates has achieved preeminence as the regional financial services centre, through the Government’s wise and far-sighted policy of maintaining an open and diversified economy base and by paying close attention to the legal and regulatory infrastructure.

This has provided the framework for the UAE insurance industry to flourish and for Bahrain to become the insurance hub of this important region. Since 2002, the Central Bank of Kuwait (CBK) acts as the regulator of the insurance sector and provides an efficient regulatory framework for financial services firms operating in Kuwait. Further, all legal, regulatory and supervisory insurance frameworks follow the essential criteria of the International Association of Insurance Supervisors (IAIS) core principles and methodology.


Governance of the CBK is largely prescribed in the Central Bank of Kuwait and Financial Institutions Law 2006 (‘CBK Law’).
Article 5 of the CBK Law specifies that the CBK shall have a Board, comprising seven Directors, appointed by Royal Decree for a renewable term of four years. Articles 6 through 9 specify the conditions that Directors must satisfy in order to hold office; requirements regarding the proceedings of the Board; the powers of the Board; and the conditions under which Board membership may be terminated.

The day-to-day management of the CBK is entrusted to a Governor, with ministerial rank, and who is directly accountable to the Board. The Governor is appointed by Royal Decree for a renewable 5 year term. The Governor may be supported by one or more Deputy Governors (Article 10).
The Governor is obliged to present a report to the Board within 3 months following the end of each financial year, on the CBK’s operations, together with a copy of the audited accounts of the CBK and the external auditor’s opinion on those accounts (Article 36). In addition, the CBK’s financial operations are subject to review by the National Audit Court (Article 2).

In addition, Article 173 of the CBK Law requires the CBK to present regular reports on the operations of the CBK to the Minister of Finance, who is responsible to the parliament for his oversight responsibilities with respect to the activities of the CBK.
In addition to the above mechanisms, the CBK also ensures effective internal governance of the organisation and its operations through a system of internal committees, supported by documented policies and procedures (which include a staff code of conduct).
Finally, an internal audit and quality assurance function, reporting directly to the Governor with a right of access to the Board, provides assurance on internal systems and controls.


The Central Bank of Kuwait (‘CBK’) is responsible for regulating and supervising the whole of Kuwait’s financial sector. Prior to the creation of the CBK in September 2006, the Kuwait Monetary Agency (‘KMA’) had previously acted as the sole regulatory authority for Kuwait’s financial sector. (The KMA was responsible since its establishment in 1973 for regulating Kuwait’s banking sector, and was subsequently given responsibility in August 2002 for regulating Kuwait’s insurance sector and capital markets.)

The CBK’s duties include the licensing and supervision of banks (both conventional and Islamic), providers of insurance services (including insurance firms and brokers), investment business licensees (including investment firms, licensed exchanges, clearing houses and their member firms, money brokers and investment advisors), and other financial services providers (including money changers, representative offices, finance companies and ancillary service providers).

The CBK also regulates Kuwait’s licensed exchanges and clearing houses and acts as the Listing Authority for companies and financial instruments listed on the exchanges. It is also responsible for regulating conduct in Kuwait’s capital markets.


Debt issue is amongst the most common methods of raising long/short – term funds for economic firms, to the extent that, in developed countries, debt issue takes up a bigger portion of corporations’ debt portfolio than bank loans. A main goal of the National Financial Institute of Kuwait is to help corporations benefit from the debt market potentials parallel to money market.

Regarding huge untapped capacity of debt market in meeting financial needs of corporations, the National Financial Institute of Kuwait offers services for issuance of debt instruments and underwrites securities, to reduce debt issuance costs, in order to facilitate firms access to debt market potentials. The Bank is well- prepared to study the needs of companies, provide consulting services and advise debt instruments that best fit the company. A summary of some issuable debt instruments is as follows:

  • • Ijarah Debt Instrument is used for financing expansion projects or to provide working capital. Existence of a fixed (physical) asset with shared-ownership, as the basis of this instrument, is essential. From the statutory point of view, the asset should be assignable (salable) and have a longer durability than maturity date of the instrument.
  • • Murabahah debt papers are typically used for purchase of new property, purchase of raw material or for working capital. This instrument is backed by the properties and goods which the company is going to purchase. In this method, the raised amounts are transferred to the supplier of goods.
  • • Participation Papers are used to finance profitable economic projects with technical, financial and economic feasibility, a positive net present value and an internal rate of return larger than the fixed interest rate of the banking system.
  • • Manufacturing order debt papers (Istisna) provide funds for contracting activities and manufacturing orders. In such mode of finance the capability to build and deliver the property, the underlying asset for debt issue, on the specific future time should exist. The goods which are produced frequently in mass volumes cannot be the underlying asset for issuance of this instrument.
  • • Debt purchase papers are instruments used for purchasing long-term legal persons’ debts in Rial. The debts should have been created by Contracts of Exchange (excluding Salaf (Salam)).
  • • Standard Salaf Papers can be used to raise funds for producers of goods. In this mode, the Sharia Law shouldn’t have prohibited using the underlying property for this purpose (for example, any type of coins or gold cannot act as the underlying asset for issuance of Salaf Sukuk)
  • • Mudharabah papers are used for carrying out trade activities. Regarding (the nature of) Mudharabah contracts, the return is directly proportional to the return of trade activity which makes it quite unsteady, so the actual return is calculated at the end of the financial period.
  • • Joaleh papers are issued for financing expansion projects, among others, or for purchasing property. These papers represent shared-ownership of property and the title/interest ( of service or physical property) is transferred to holders of papers at the end of Jo’aleh contract period.
  • • Usufruct papers are used to furnish liquidity for owners of durable assets, for working capital or for expanding economic activities of companies and service providers. In this method, the property owners transfer a part of usufruct of durable property in advance, based on which the usufruct papers are issued and sold to applicants for a certain amount. Likewise, the service providers are also allowed to raise finance by issuing usufruct papers against transferring a part of their future services.
  • • Muzara Sukuk is issued to raise finance for purchase of farmland. The financial entities working in agriculture sector may benefit from these papers. The financial entity, having received the share of sukuk holders (owners of the land) from the crop
    and selling it in the agricultural commodities market, collects its attorney fee and then distributes the profits among the sukuk holders.
  • • Musaqat papers are used to finance purchase of investible orchards and the lands which may be converted to orchards. The financial institutions involved in agriculture sector may benefit from this instrument. Through this mode, The financial entity, having received the share of sukuk holders from the crop and selling it in the agricultural commodities market, collects its attorney fee and then distributes the profits among the paper holders
  • • Gharz-ohassaneh papers are mainly used for public interest projects and are issued based on non-usury Gharz-ol-hasaneh contracts. The governments and renowned charities can benefit from this method. Maturity period of these papers is set according to needs and requirements of the issuer but (except for one-year maturity period of Salaf papers), it is generally between 2-5 years.