Revisão do Jornal Árabe de Negócios e Gestão

Discuss the Banking Regulatory and Market Framework in Kuwait Using SWOT Analysis

Abstract

Payal Chadha

This paper discusses the banking regulatory and market framework in Kuwait. SWOT Analysis of Kuwait Banking Sector addresses the strengths, weaknesses, opportunities and threats. As a major oil exporter, it has enabled Kuwait to erect strong exterior and financial balance sheet situations. The government is a large net creditor and has a high flexibility to respond to external shocks. Since the institutional framework works as an obstruction to effective decision-making in the country with regards to transparency and accountability, political risk is considered as a weakness. Kuwait faces geopolitical risk, similar to its peers in the Gulf Cooperation Council (GCC). Credit risk is high for the Kuwaiti banking sector, as the banks have historically operated with significant exposures to cyclical sectors such as real estate and construction. Finally, Kuwait's legal framework regarding bankruptcy law, creditor rights, and process remains less developed when compared to other parts of the world.