Press Releases

H.E. the Governor of the Central Bank of Kuwait (CBK), Sheikh Salem Abdulaziz Al-Sabah, announced in a press statement to the Kuwait News Agency (KUNA) that the CBK Board of Directors has decided, in its meeting on 8-10-2008, to cut the discount rate by 125 basis points from 5.75% to 4.5% effective from Wednesday the 8th of October 2008. H.E. the Governor explained that the decision resulted from CBK's close monitoring of the fast evolving local, regional and international developments related to the crisis gripping international securities markets, and the need to strengthen the domestic front to confront the potential impacts of that crisis.

It may be noted that the discount rate is a pivotal rate to which are linked, within specific margins, the ceilings of KD lending interest rates in the domestic banking and financial units. Accordingly, the cut in the discount rate automatically leads to equal decreases in the maximum KD lending interest rate limits in the domestic banking and financial units.

H.E. the Governor added that CBK completely realizes the different dimensions of the extraordinary circumstances currently facing the national economy in general and the banking and financial sector in particular. We are part of the global economy where markets are ever more integrated thus expanding the spillover effects of any turbulence in its centers. Therefore, it is increasingly important to take precautionary measures to consolidate the domestic banking and financial system within the framework of the basic stances of the monetary and supervisory policies of CBK aimed at strengthening the foundations of monetary and financial stability in the national economy.

Finally, H.E. the Governor emphasized CBK keenness in these sensitive times to stand ready to employ all monetary tools and supervisory measures at its disposal to enhance confidence and secure monetary and financial stability in the national economy.