Gulf Bank said in a disclosure published on the Kuwait Stock Exchange website on Thursday that the Central Bank of Kuwait has approved its full conversion to operate in accordance with Islamic Sharia and to proceed with completing the conversion procedures. Once those procedures are completed, the bank said, it must apply to the central bank to have its name removed from the conventional banks register.
Until it is registered in the central bank's Islamic banks register, the bank cannot conduct Islamic banking activities. Gulf Bank reaffirmed its commitment to applicable laws and regulations, including obtaining any approvals required from regulatory authorities as part of its transition to a Sharia-compliant bank.
WHAT IT MEANS FOR CUSTOMERS
Gulf Bank, established in 1960, says it is entering a new chapter in preparation for a full transformation into a Sharia-compliant bank. On its conversion page, the bank tells customers there is no change to their accounts or products at this stage.
It may, however, seek customers' consent to change existing contracts or documentation to align them with Islamic banking principles. The bank says the conversion will allow it to offer a wide range of Sharia-compliant products and services while keeping the same level of customer service.
FROM INITIAL APPROVAL TO FINAL GO-AHEAD
The central bank granted its preliminary approval in August 2025, acting under Law No. 32 of 1968 on currency, the Central Bank of Kuwait and the organisation of banking business. That approval gave Gulf Bank one year to finalise all regulatory and operational requirements for the conversion. Among the requirements, the bank was to prepare a conservative capital adequacy ratio scenario showing that it did not benefit from the "Alpha" adjustment factor.
PROFITS AND THE WARBA QUESTION
Gulf Bank reported a net profit of KD 41.9 million for the first nine months of 2026, up 9.1% from KD 38.4 million a year earlier. Total assets rose 2.4% from the end of 2025 to KD 7.9 billion, while net loans and advances grew 7.0% to KD 6.3 billion.
Its Tier 1 ratio stood at 13.7% and its capital adequacy ratio at 15.7%, against regulatory minimums of 11% and 13% respectively.
THE TGB VIEW
According to the TGB market profile, Kuwait's ten local banks are five conventional, four Islamic and the specialised Industrial Bank of Kuwait, so Gulf Bank's move from the conventional register to the Islamic register would add to the Islamic group. Size is another matter: Gulf Bank's total assets were KD 7.9 billion at the end of September 2026, while National Bank of Kuwait and Kuwait Finance House, listed 11th and 12th in TGB's Largest banks in the Middle East & North Africa 2026 table, reported consolidated assets of KD 45.6 billion and KD 42.8 billion at end-2025. The next step to watch is Gulf Bank's application to leave the conventional banks register once the conversion procedures are complete.
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