Kuwait Finance House (KFH) held its annual general Assembly meeting (AGM) with a 75.898% quorum and approved the Board of Directors’ recommendation of distributing cash dividends of 12% and bonus shares of 10% to shareholders.

Hamad Abdulmohsen Al-Marzouq - Chairman of Kuwait Finance House (KFH)

On behalf of myself and members of the Board of Directors of Kuwait Finance House (“KFH” / the “Bank”), I would like to present to you the 2021 KFH Group Annual Report.

The Covid19 pandemic has imposed several challenges and produced various economic complications during the past two years. Although the virus risks on global economy continued, KFH has managed to add to its long record of accomplishments other significant achievements which have contributed to the mitigation of the negative impacts of the pandemic in geographies where the bank operates worldwide. KFH achievements have clearly highlighted the bank’s pioneering role in maintaining sustainable development, using Islamic finance tools, which have globally recorded strong performances during the year. We had a proactive vision in encountering challenges and continuing our outstanding role in the development of society and meeting customers and shareholders aspirations, taking into consideration the latest global variables, such as climate change.

KFH Group efforts have driven Islamic banking industry to take the lead, with the Group achieving impressive indicators as one of the largest Islamic banks worldwide and a pioneer in the Islamic financial services industry. We have achieved, by the grace of Allah, significant growth in all basic financial indices and maintained remarkable ratios on assets and shareholders’ equity. Also, we have succeeded in reducing costs and increasing profits. Our proactive plans have managed to improve asset quality indicators and troubled debts coverage ratios.

Net profit attributable to shareholders reached KD 243.4 Million in 2021 i.e., an increase by 64.0% compared to last year. Earnings per share reached 28.59 Fils i.e., an increase by 61.2%. Our efforts have succeeded in improving economic environment, enhancing projects, and meeting customers` aspirations. As such, the finance portfolio reached KD 11.4 Billion i.e., an increase by KD 608 Million or 5.7% compared to 2020. KFH Group assets increased to reach KD 21.8 Billion i.e., an increase by KD 286 Million or 1.3% as at the end of 2021. Our competitive and distinguished performance has attracted more customers and investors with customers` deposits increased reaching KD 15.9 Billion in 2021 i.e., an increase by KD 550 Million or 3.6%, thus maintaining our customers trust.

KFH has succeeded in enhancing the group’s capital base as the capital adequacy ratio increased from 17.53% by end of 2020 to 18.69% by end of 2021.

KFH is continuing its role in leading the Islamic finance industry and offering innovative products and services that would play a significant role in achieving the economic vision and supporting growth and sustainability. We can improve economic environment while observing environmental, social and governance aspects and contributing to the global endeavor to achieve climate safety goals. To this end we have issued the Green Sukuk to finance social and environment- friendly projects. We are proud of having successfully led the arrangement of a sustainable Sukuk issuance, the first of its kind by an Islamic financial institution. Also, it is the first global sustainable Sukuk for Tier 2 capital in favor of KFH-Turkey amounting to US$ 350 Million.

KFH seeks to meet customers and shareholders aspirations and maximize their equity by adopting the highest governance standards, maintaining their interests according to a fully integrated transparency framework and ensuring the financial stability of the banking system.

KFH has played a pivotal role in restoring post-pandemic stability. We have proactively shouldered our responsibilities in addressing challenges as a leading Islamic bank. Our employees have played a significant role in following applicable protocols and maintaining customers’ safety while providing banking services.

Digitalization

KFH is one of the leading banks to offer innovative digital banking solutions through the launch, for the first time in Kuwait, of several banking solutions. Our online digital services on mobile applications have gained great interest and trust from customers on account of their easiness, efficiency, and diversity. The number of online banking transactions executed by KFH customers through KFHonline or mobile application approximated 160 million in 2021 i.e. a growth by 25% compared to last year.

KFH has achieved remarkable success in initiating the national payment system through a fully integrated application compatible with the CBK systems and corresponding to the Swift Global Network. This application would mitigate the cost of local banks payments and achieve the highest ratios of integration according to regulatory requirements. Accordingly, KFH has set the corner stone and the starting point of a huge package of future services such as mobile payments, etc.

Our information technology was one of the remarkable success stories during the year. We have launched new innovative products and e-services based on the latest technical calibers and technology systems. Keeping up with accelerating technology, we have developed various KFH applications and program platforms. Also, we have issued regular reports which have contributed to the mitigation of Covid19 impacts on customers namely the SME category.

Youth Capabilities and Inherent Powers

As approximately 250 thousand youths (males and females) are expected to join the labor market in the next five years, it has become imperative for KFH to accommodate the potentials of this category. The Innovation and Communication Department at KFH is seeking to accomplish this mission and enhance KFH market share in this sector by implementing short and mid-term strategies and plans. The bank aims to establish a long-term plan and invest internal and external resources to make KFH the employer of choice for the youth.

We have launched several successful campaigns, designed mainly for customers and shareholders, based on field research and specialized studies, thus contributing to the improvement of the internal environment. The bank has witnessed remarkable and sustainable growth as the efficiency of high-quality assets increased and our market share of personal financing strengthened significantly during 2021.

Group Human Resources continued to focus on its Nationalization agenda where we continued to maintain a healthy 76% Kuwaitization ratio, develop national talents and demonstrate our role in, and contribution to, the Kuwaiti Economy. KFH continues to be amongst the largest employers of Kuwaitis in the Private Sector, highlighting KFH as the employer of choice in Kuwait. We have acquired and developed national talents where the Kuwaiti nationals recruits for the last few years ranged between 98% - 100%, most of them fresh graduates. We are keen on implementing the succession plan and working on having Kuwaiti nationals in Middle and Executive Management, which would achieve labor nationalization goals at KFH. This practice would help KFH to transform itself into an organization best able to adapt to the changing environment and support KFH’s agenda to become a more efficient and cost-effective organization as well as to meet KFH’s nationalization goals.

Governance and Sustainability

Sustainability Strategy Development Process emanates from KFH vision to enhance its pioneering global position in Islamic finance services development and raise the bank level to be the most profitable, sustainable, and trustworthy Islamic bank worldwide. This process is an activation of KFH message to achieve the highest levels of innovation and distinction in the field of customer service. Accordingly, KFH has become the highest rated bank among Islamic banks in Kuwait according to MSCI ESG standards. Our distinguished performance had led to an increase in KFH Group market value by 35% as at the end of 2021 on annual basis. Also, KFH Group market value was the highest during the year, exceeding KD 7 billion.

We have raised the ceiling of commitment by restructuring our long-term sustainability vision and determining our economic, environment, social and governance goals through all 6 factors: financial, human, social, natural, intellectual and health.

KFH Group has what it takes to keep moving forward and make huge achievements in sustainability strategy as per the latest international principles, criteria and frameworks. KFH Group provides services to customers in the GCC, Asia and Europe through 526 branches, more than 1600 ATMs and approximately 15 thousand employees in all our subsidiaries in Kuwait, Turkey, Bahrain, Malaysia, and Germany.

Our financial services cover increasing numbers of customers in various geographies worldwide, thus increasing our market share day by day. Our diversified services have succeeded in attracting more customers whose numbers increased by 6% in Kuwait, 11% in Turkey, 28% in Germany and 10% in Bahrain as at the end of 2021 compared to 2020.

KFH Bahrain is a major contributor to the economy with banking, commercial, investment and finance services in various geographies worldwide including USA and Europe. KFH Malaysia is continuing its remarkable presence in East Asia countries. KT Bank AG in Germany is the first Islamic financial institution in the Euro Zone and one of the most important stations as it plays a major role in facilitating commercial activities by establishing a link between Kuwait and Europe.

The Group banking subsidiaries play a significant role in establishing performance integration and enhancing the spread of Islamic financial services to various geographies worldwide. Also, they contribute to the enhancement of the group revenues and financial position with a share reaching 89.5% of the operating income for the year 2021.

As we are committed to realizing significant returns for shareholders, the Board of Directors has made its recommendations to the General Assembly to make cash distributions of 12%, bonus shares of 10% and distribute returns on investment deposits and saving accounts according to the schedule below:

Table (2) Depositors Profit

Distinct Developmental Role

We have continued our pioneering national role in promoting and financing government development projects. We have introduced a variety of retail, corporate and SME banking and financing solutions. KFH financing portfolio is diversified and serves various vital sectors including energy, water, electricity, infrastructure, and others.

With the support of a specialized professional banking management, providing full financing services to such promising segment, KFH Group lays particular emphasis on small and medium enterprises as one of the sectors leading the development process.

KFH will, insha’Allah, continue to promote development efforts by financing and supporting mega projects e.g., leading the Islamic segment of financing granted to Kuwait Petroleum Company, participating in the finance of the construction of the new terminal at Kuwait International Airport and supporting SME with various tools, while observing the highest performance standards of Islamic banking products and services according to the best professional practices.

Group Treasury and Financial Institutions Department has taken several significant pre-pandemics steps to improve liquidity level. This led to the strengthening of liquidity at the group level to enhance short and long-term investment returns, consider prolonging funding term and diversify the liquidity management process at the group level. As part of wider finance strategy, KFH has issued the first Tier1 Capital Mudaraba Sukuk of US$ 750 Million, thus consolidating the capital base and diversifying sources of funding.

KFH enjoys high creditworthiness. In 2021, Moody`s assigned long-term A1 and short-term P-1 ratings with a stable outlook. Fitch Rating Agency affirmed KFH`s long-term and short-term IDRs at A+ and F1 respectively, with a negative outlook considering Kuwait’s sovereign rating in Feb. 2021.  We are proud of these ratings, and we will continue to maintain safe and flexible banking standards.

Pioneering Social Initiatives

KFH combined its success, supported by indices and figures, with its outstanding social role. It has introduced a new concept of the role of money and economic activities in serving society in conjunction with development activities and citizens aspirations. KFH contributed remarkably to several strategic social initiatives which had a favorable impact on society and national economy, including an initiative to pay KD20 Million in debts to release approximately 10,000 defaulting debtors. Also, it contributed largely to the KD 10 million Covid-19 government relief fund which was announced by the Central Bank of Kuwait. KFH has also concluded various agreements with the Kuwait Red Crescent Society to subsidize human relief and aid efforts 

We are committed to placing Islamic finance as a main contributor to sustainable growth and to apply the principles of Islamic banking and responsible investment. We shall utilize all our resources to serve society and develop our abilities. 

Best Islamic Financial Institution Worldwide

In appreciation of the remarkable contributions which the group has made to the Islamic finance industry in all the markets where it operates, KFH has received various global awards e.g., “World`s Best Islamic Financial Institution 2021” from Global Finance, “Best Domestic Bank in Kuwait 2021” from Asiamoney, and several other distinguished awards at the group level, thus reflecting the pioneering position which KFH enjoys locally or in international markets.

We would like to avail this opportunity to convey our sincere gratitude and appreciation to our shareholders for their continuous and valuable support. We are confident by the grace of Allah that we will continue to achieve rewarding returns for our shareholders and depositors. Also, I would like to avail this opportunity to convey our sincere thanks and appreciation to all our employees at the group level as well as the members of the honorable Fatwa & Shari’a Supervisory Board for their outstanding efforts. 

Finally, I would like to convey our sincere thanks, gratitude, and appreciation to His Highness the Amir of Kuwait Sheikh Nawaf Al-Ahmed Al-Jaber Al-Sabah, may Allah safeguard him, His Highness the Crown Prince Sheikh Mishal Al-Ahmed Al-Jaber Al-Sabah, may Allah safeguard him, and His Highness, the Prime Minister Sheikh Sabah Al-Khaled Al-Hamad Al-Sabah. Our thanks and appreciation are also extended to the Central Bank of Kuwait, regulatory authorities, partners, and all parties concerned.

May Allah grant us Success.

AbdulWahab Essa Al-Rushood- Acting Group Chief Executive Officer

Kuwait Finance House (KFH) is a customer-oriented Islamic financial institution as it always considered customer as a partner and one of the fundamental elements of KFH success. KFH’s 4-decade journey has not been easy; however, it was distinguished by outstanding performance, accomplishments and significant results considering the huge volume of well-planned and studied initiatives. It was inspiring to realize the contributions made to the Islamic finance industry and the new horizons it opened to diversify the innovative Islamic financial products and services. Also, KFH’s journey was effective in terms of status, robustness and efficiency in encountering challenges and crises and witnessed several developments taking into account its compatibility with the latest financial technology and the unique digital banking solutions applied. KFH is a home for employees and a school for leaders. KFH journey was and still is the center of global interest. KFH has maintained its leading position as a pioneer in Islamic and financial services industry operating through a regional and global banking network covering 7 regions worldwide, 526 branches, 1,600 ATMs and 15 thousand employees.

Financial Indicators

In affirmation of its pioneering position, KFH has exhibited several positives in its financial indicators. KFH enjoys high liquidity ratios and a solid capital base. These factors support KFH regulatory compliance on one hand while on the other they support business growth, diversify sources of finance, increase the bank finance and investment abilities, and enhance expansion in infrastructure projects and various economic sectors in Kuwait and the regions where the group operates e.g., Turkey, Bahrain, Germany, Malaysia, and Saudi Arabia.

KFH has achieved remarkable financial results for the year 2021 despite the local and global challenges encountered. Net profit distributable to shareholders for the year 2021 reached KD 243.4 Million i.e., an increase by 64.0 % compared to last year.

Total assets reached KD 21.8 Billion i.e., an increase by KD 286 Million or 1.3% compared to last year 2020. Depositors accounts reached KD 15.9 Billion i.e., an increase by KD 550 Million or 3.6% compared to 2020. Capital adequacy ratio reached 18.69%, thus exceeding the ratio imposed by regulatory authorities. This ratio affirms the strength of KFH financial position.

Non-Performing Financing (NPF) improved as the Group’s NPF ratio reached 1.6% by the end of 2021 (according to CBK calculation basis) which is a favorable ratio given the economic conditions brought about by the pandemic. The debts coverage ratio from provisions only is remarkable as it reached 319% for KFH Kuwait and 326% for the group by the end of 2021.

We continue our endeavor to improve asset quality, develop credit policies and governance systems according to best practices. We are keen on increasing investment in green Sukuk in the financing portfolio, namely projects related to carbon emissions, so that we could participate effectively in building a new Kuwait while we play a vital role in driving the wheel of growth for the benefit of present and future generations. 

Strategy

KFH has a fully comprehensive and clear strategy focusing on big data management. Open and neutral partnership models of our operations aim to increase flexibility, quality, transparency, and efficiency which our customers seek, as per a clear strategy. Also, it enables us to develop and enhance group products, improve customer service to be the leading bank in Islamic banking industry, expand our creditworthiness, lead growth across main geographies, business sectors and customers. We aim to increase our presence and impact in the banking industry by interconnecting and bonding the group banks.  We continue to strengthen our presence in main international markets as we have long term investments in the Middle East and other regions worldwide. We manage banks in Bahrain, Saudi Arabia, and Turkey. Our investments in Asia “KFH Malaysia” have expanded, while our branch in Germany is remarkably growing fast.

Strategy sector has exerted tremendous efforts during the year 2021 through a careful follow-up on all group activities and sectors as well as providing executive management with reports.

A Pioneering Role in Supporting Development Projects

KFH continues its role and endeavor in supporting national economy by introducing a variety of retail, corporate and SMEs banking and financing solutions. KFH played a pivotal role in Kuwait’s 2035 vision. It has participated in major development projects in the GCC and international markets in various fields e.g., infrastructure, energy, water and electricity, transportation, communications, housing, real estate development, industry, oil, and other projects which have created a paradigm shift and prosperity in our society, not to mention they created jobs and provided national expertise.

Concerning SMEs, KFH provides all types of cash finance services e.g., Murabaha, Tawwaruq, Ijara and non-cash finance e.g., all types of L/Cs and L/Gs in addition to various e-services.

KFH Capital

In 2021, KFH Capital, the investment arm of the group, led the successful arrangement of sovereign and corporate Sukuk issuance deals exceeding US$ 15 Billion in favor of a diversified customers in various sectors and geographies.

KFH Capital participated in the issuance of KFH Sukuk as part of tier1 capital amounting to US$ 750 Million and the issuance of the first sustainability Sukuk for Kuwait-Turkey as part of tier 2 capital amounting to US$ 350 Million. 

Major deals executed during the year comprised Sukuk issuance deal for the Saudi company ARAMCO (US$ 6 Billion), Islamic Development Bank (US$ 1.7 Billion), Islamic Bank of Dubai (US$ 1 Billion), Ahli United Bank in Kuwait and Bahrain (US$ 600 Million each) and government of the United Kingdom (US$ 700 Million).

Real estate investments reflected KFH Capital remarkable performance. The company played a significant role in managing and maintaining customers’ investments successfully through various asset classes and multiple geographies. Also, it has ensured the flow of cash distributions to most of its investment funds during the pandemic. Furthermore, it has successfully launched the e-trading service in the USA market through “KFHonline” as more than 3,500 new customers used this service in 2021.

Innovative Products and Services

We have successfully launched, in 2021, several innovative products, services and digital technologies which have, by the grace of Allah, exceeded customers’ expectations. The services and products comprised the following:

A package of services launched for the first time in Kuwait, such as:

• Instant transfer to KFH-Turkey accounts.

• Executing ATMs transactions using smart phones and watches.

• Requesting financing using e-signature through KFHonline app.

• Instant online FX transfer with competitive prices to serve a large group of customers.

• Instant printing of ATMs cards using Civil ID or KFHonline within three minutes.

• Instant printing of cheque Books via KFH GO.

KFH also launched a range of services including:

• Opening bank accounts online for new customers without having to visit the branch by using e-signature through MYID app.

• Smart personal saving options with MY Saving Plan through KFHonline.

• Launching the “KFHonline” appl on the e-platform of Huawei

• Opening bank accounts/deposits in KFH-Turkey for private banking customers.

• Money market funds for high-net-worth customers.

• Launched two distinguished Mastercards World Elite and World in collaboration with Kuwait Airways Corporation.

• Launched digital pay services to KFH cardholders on Garmin, Samsung and Fitbit Pay.

• Launched IVR service for the new call center to improve customer service.

• Starting to redesign the branch network using the best digital applications to reduce crowding of customers and improve their banking experience with a focus on providing digital services without having to visit the branch.

• KFH Auto showroom, the largest finance center in the Middle East to fulfill customers’ needs and requirements in the purchase of cars and other finance products. The center provides more than 22 finance services and products.

KFH was the first bank in Kuwait to launch Instant Card Issuance service, without the need for a pre-request, through 100 ATM machines covering all KFH branches in addition to certain malls. The branches network is considered the largest in Kuwait in terms of the number of machines available. The service enables the instant issuance of cards within 3 minutes in various methods including self-service, the iPad available with the branch employees or a smart phone using QR Code.

Customer satisfaction is a crucial factor in KFH growth and sustainability. KFH focus is always aimed to enhance customer experience. In this respect, KFH has launched CX Hero program for employees to build a strong culture concerning customer-focused service, enhancement of customer satisfaction and encouragement of employees to exceed customers’ expectations.

Group Treasury and Financial Institutions Sector

As part of KFH endeavor to develop the money market for Islamic banks and being a leading and active market maker locally, the Group Treasury and FI Department has developed new credit facilities for top- rated banks locally and regionally to better distribute risks and maintain a prudent balance to achieve highest returns on additional available liquidity. The Group Treasury continued its growth by closing several syndicated and bilateral deals, locally and internationally, thus recording a standard high value, exceeding US$ 2.3 Billion in all transactions. These deals reflect KFH leading position in the Islamic banking services market in fulfilling customers’ needs.

Group Treasury has relentlessly expanded its investment and trading activities in Primary and Secondary Capital Markets. Being the most active market maker in the secondary market, the Treasury Dept. has executed Sukuk transactions worth more than USD 16 billion during 2021. Meanwhile, it continued to execute orders in the secondary market for KFH-Kuwait’s first Sukuk issuance.

Kuwait Finance House maintained its top primary dealer position in the IILM Sukuk program. Also, KFH achieved the top rank dealer in the secondary market. It is an unprecedented event that a financial institution occupies the top rank dealer for the IILM Sukuk Program in both primary and secondary markets. As a part of Capital Market strategy to diversify exposure, the Treasury Department invested in GBP Sukuk issued by the UK government and increased its Sukuk issuance exposure. Group Treasury continued to introduce new innovative products and brought onboard, during the year, several new large corporate clients to deal in Islamic derivatives, hedging instruments and solutions for FX and profit-rate risk such as Shari’a compliant FX Options, FX Al Waad, and Profit-Rate Swaps (PRS), in addition to its existing products. Also, it built a new partnership with a leading global bank to be their Market Maker for GCC currencies through a digital platform.  Furthermore, it introduced fully automated FX live rates for online banking FX transactions with back-to-back covering from international markets to meet customers` needs with cutting edge processing and settlement technology and to optimize the speed of transactions by utilizing Straight Through Processes (STP), while increasing the ability to penetrate markets and expand customers’ base with executed FX volume of over USD 50 billion during the year.

Information Technology

KFH Information Technology Department achieved several accomplishments in 2021. Considering the integration between the new e-services and the Public Authority for Civil Information, the bank has activated and launched several new e-services in addition to the services launched previously in collaboration with PACI, thus facilitating banking services for customers. IT Department has established SOA platform which allows the launch of new products swiftly and efficiently. Also, it launched KFHonline application on Huawei International platform and STP system (outgoing swift payments).

Coping with advanced technology, KFH has sought to achieve cloud integration among all protection systems, thus allowing security information and event management products and services (SIEM), which are gathered by SIM department and SEM department, to provide analysis and make real time decisions through security alerts produced by the e-network systems. Furthermore, KFH has developed Covid19 Credit Control Reports Package by automating the monthly credit control reports according to CBK mandate to report the impacts of the pandemic. Related reports comprise reports on customers credit operations including MME. In addition, KFH has upgraded the debit card encryption technologies to CVN18, launched a new setting matrix for credit cards, developed IMAL system, launched the new upgrading system GFS and restructured the gold account product. To enhance customers online purchase experience by using credit cards and to mitigate fraud operations, KFH has applied EMV 3D Secure (2.0).

Group Operations

KFH Group Operations continued to play a vital role in enhancing KFH rigorous digitalization strategy. KFH has become the leading bank in adopting innovative technology that maximizes productivity, minimizes cost, and maintains the lowest risk ratios and most sound control measures.

In 2021, we launched and engaged in several transformation projects and adopted Fintech concepts e.g., (e-Form) which is considered a pioneer e-channel exhibiting all data without any manual interference.

One of the prominent achievements in card operations is the conversion of all KFH Debit & Credit Card portfolio to offline Pin verification based on central bank mandate. This process was completed before due date.

We were able to establish business rules in our payment system which has enabled us to convert 40% of our outgoing SWIFT messages to STP (Straight Through Processing), thus, minimizing both messages life cycle & manual interference for IBAN countries transactions with TRY & USD to Turkey and SAR to KSA.

We have enhanced customer experience in Retail Banking as we have finalized the e-payment process via CRM soft copy which has accelerated the disbursement process to be 1 day after completing CBK 2 days mandatory grace period.

We have launched the industry authority’s electronic gate which will enable users to have full 360 degrees view and control on all industrial real estate finance products offered by KFH.

We have automated the issuance process of various collaterals in the systems (e.g., real estate – stock – cash – finance …etc.) related to the new Shari’a compliant credit and finance facilities.

Operations department has performed several intellectual initiatives to adopt more advanced technological specifications e.g., SWIFT ISO20022: to enhance consumer finance work procedures. Operations has managed to minimize the period required to execute transactions from 5 days to 1 day.

Risk and Business Development Department

Group Risk Department has made several accomplishments. Digitalization has transformed normal risk reports into interactive dynamic reports, thus, significantly improving the integration process and risk control and analysis. 

Group Risk Department has developed and implemented non-performing finance strategy framework. It has updated NPF strategy in all subsidiaries, used early alert systems, concepts, and tools to improve asset quality and applied best international practices to better control balance sheet and improve the Group assets quality.

Group Risk Department has succeeded in making a major shift in the AML Technology plan. It has conducted an intensive evaluation of the technological part to cover all AML and terrorism finance programs and applications, thus protecting the bank from non-compliance risks.

Group Risk tendency has been upgraded to better cope with the current fluctuating economic conditions.

For Building Operational Resilience framework and roadmap, we have delivered 3rd party risk framework and policy, developed methodology for 3rd and 4th risk assessment, and embedded procurement and vendor management procedures. Related benefits comprise ensuring transparency around 3rd party outsourcing, ensuring outsource services to suppliers are aligned with KFH internal risk appetite as well with internal policies and ensuring 3rd and 4th party business continuity capacity and capability

Shari’a Department

KFH Shari’a Department continued to perform its functions and tasks despite the challenges imposed by Covid-19 pandemic. Group Internal Shari’a Audit Department has executed Shari’a audit functions on KFH sectors and departments according to the 2021 approved plan. Shari’a Research and Advisory Department has reviewed all contracts, products, agreements, and policies received from KFH departments and sectors, replied to Shari’a questions and inquiries, and raised necessary inquiries to the Fatwa and Shari’a`s Supervisory Board for their thoughts about Shari’a matters. To spread Shari’a awareness and culture among customers and employees, all Shari’a inquiries received from customer on the phone have been answered and economic jurisprudence announcements have been prepared and posted to employees through KFH e-channels. Also, several training programs have been designed and executed for employees as the number of Shari’a programs for KFH employees reached 510 programs.

KFH Talents

During 2021, Group Human Resources was a pioneer in fostering and acquiring talents matching KFH present and future visions and aspirations. Human Resources continued to improve business protocols which have ensured the safe and secured return of employees to their posts at KFH. Human Resources and Public Relations have launched several campaigns to encourage KFH employees to take the Covid19 vaccination and ensure their safety and good health.

We have introduced virtual training platforms to provide employees with the required tools and enable them to achieve their goals. Our investment in the development of the (HiPos) program and future leaders’ program (Successors) represents 37% of our training spending.

Human Resources has achieved diversification and inclusiveness in its employees’ structure as the ladies’ presence in the “Forsa” talent development program reached 48%. This representation is the highest compared to preceding years. Group Human Resources conducted a Ladies Pulse Survey addressed to KFH Lady employees to fulfill their needs and aspirations. We have focused on increasing the talented ladies’ presence in KFH team.

KFH continued to fulfill its commitment to enhance and support national labor as it increased the number of Kuwaiti nationals in middle management posts, thus leading the Kuwaitis percentage in the middle management to reach 60%. Concerning Executive Management, Kuwaiti employees represent 77% as KFH continued to focus on promoting national talents. In addition, KFH continued to bear its responsibilities in attracting youth national talents from the manpower market as it employed 344 Kuwaiti citizens during 2021.

We have enhanced investment in training present and future leaders through continued cooperation with Major universities and educational institutions. The third batch of HiPos employees was enrolled in intensified programs presented by Harvard Business School, to further refine the skills and capabilities of our future leaders. Concerning Executive Management, we have coordinated with three of the best business schools globally, Harvard Business Schools, INSEAD and IMD.

During 2022, we shall implement new and prudent practices which we have learnt in 2021 and improve our institutional procedures and working methods as a pioneering organization seeking continuous development. With the grace of Allah, this would enable us to continue acquiring and developing our talents in the future.

Social Contributions for More than 4 decades

Over nearly 45 years, KFH has been putting human and social services on top of its priorities. The bank took a leading role in all aspects of social responsibility according to the highest standards. KFH participated in several strategic social initiatives e.g., paying KD20 Million in debts to release approximately 10,000 defaulting debtors. Also, it contributed largely to the KD 10 million Covid-19 government relief fund which was announced by the Central Bank of Kuwait; it made a solo additional contribution to the fund.

KFH signed an agreement with Kuwait Red Crescent Society to execute relief and medical projects for the Syrian refugees and needy persons in Jordan in cooperation with the Jordan Red Crescent. Also, it signed two agreements with King Hussain Cancer Foundation and the Kuwaiti Red Crescent for the cancer treatment of refugees from Syria and Gaza strip in Jordan.

KFH enjoys a long and distinguished record of partnership and support to Kuwaiti youth initiatives and encourages them with digital applications and solutions. KFH support to the entrepreneurs and to KFH`s ambassadors reflects its leading role in encouraging the Kuwaiti youth and enhancing the concept of entrepreneurship business.

We have organized several social initiatives designed specially to suite each society segment. KFH activities and events were highly recognized and appreciated by all society members. Youth and students occupied a major part of KFH social responsibility. Accordingly, we have renewed our strategic partnerships with various universities and schools in the private and government sectors to support students and youth. 

As part of its leading role in social responsibility and its endeavor to support and enable the persons with special needs, KFH has signed a partnership agreement, first of its kind in the banking sector, with “Kuwait Society for the Handicapped” according to which it shall carry out various initiatives including the training of a group of students with special needs in various KFH departments. Banking wise, KFH enables customers with special needs to benefit from its banking services and products without bearing any additional charges. A special branch is allocated for the customers with special needs in each governorate. The branch comprises appropriate car parking, wheelchairs, and all other necessary requirements for this segment of customers. KFH has also provided one ATM machine at least in each branch to serve the persons with special needs. Customers may access the ATM machine easily in a completely private glass room. The ATM glass room may be accessed by card and has the hearing aids facility. KFH has highly specialized staff, having knowledge in sign language, to provide services to the persons with special needs. This service reflects KFH keenness to provide banking services to all society segments according to the highest service quality standards.   

KFH made significant contributions to Kuwait Foundation for the Advancement of Sciences, Public Authority of Manpower, Institute of Banking Studies and other social initiatives which have strengthened KFH pioneering position in the sustainable social development.

Concerning (ESG) standards, KFH is the first bank to exceed boundaries of sustainable development (ESG), thus reflecting its long compliance with the Shari’a principles of transparency, justice, and empowerment. In this respect, KFH has focused on a comprehensive sustainability strategy that aligns the bank activities with the best international practices including the increase of awareness on the significance of protecting the environment and agriculture. KFH signed a strategic partnership agreement with SEDRA Initiative and the voluntary Green Dream team to fund the first stage of the project which comprises the plantation and maintenance of 500 trees for 3 years which is the average period required for the trees to become self-sufficient.

20 Prestigious Global Awards

During 2021, KFH won 20 highly reputable awards at the group level from various global institutions and entities specialized in finance and business, in appreciation of its outstanding performance, contributions, financial indicators, excellence factors, digital initiatives and innovation in products and services, customer’s satisfaction, strategic relations and ethical compliance.

KFH won the “Best Islamic Financial Institution for 2021” Award from Global Finance in the 14th ceremony of the Magazine’s annual awards. Global Finance has also awarded KFH the “World’s Best Islamic Projects Provider” Award, “World`s Best Islamic Takaful” Award for KFH Takaful, the “Best Islamic Financial Institution in Turkey” Award for KFH- Turkey and the “Best Islamic Financial Institution in Europe” Award for KT Bank AG-Germany.

Among other prestigious awards, KFH won highly reputable “Best Private Bank for Islamic Services” Award from the Private Banker International Magazine in its 31st awards ceremony

A flagship institution

The status of our institution, customers loyalty, shareholders trust, Board of Directors support, Executive Management performance and employees’ dedication are all factors which have driven our pride high and induced us to shoulder more responsibilities to maintain this huge legacy and flagship institution by enhancing KFH pioneering role and strengthening its position as a world leading Islamic financial institution.