Investment Dar stake in Boubyan Bank cleared

Islamic investment firm Investment Dar said on Saturday it had won central bank approval to buy up to 20% of Sharia-compliant lender Boubyan Bank, driving up its stock by 3.6%.

Investment Dar said in a statement on the bourse web site the firm was allowed to raise its stake to not more than 20%.

Investment Dar owns around 4.9% of Boubyan Bank, which is Kuwait's second Islamic lender after larger rival Kuwait Finance House.

Al-Watan daily said on June 11 Investment Dar, Global Investment House, family-owned Kharafi Group and Al Bahar Group had asked the Kuwaiti central bank to allow them to hike their stakes to more than 5% in Boubyan Bank.

Competition among Islamic lenders is expected to heat up in the Gulf Arab state after Kuwait's parliament last week approved government plans to set up the country's third Islamic bank, with a capital of 100 million dinars ($347 million).

Jaber Islamic Bank is expected to start operating one year after winning government approval.

In addition, Kuwait Real Estate Bank has said it will begin operating according to sharia, that bans interest, on July 1.

Boubyan made a first quarter profit of 3.1 million dinars ($10.76 million), almost double its profit in the year-earlier period.

According to the bourse web site, the only Boubyan shareholder owning more than 5% is the Kuwait investment arm (KIA) with a 20% stake.

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