Kuwait Finance Agrees to Reschedule Aref Investment Debt

Kuwait Finance House, the emirate’s largest Islamic bank, has signed an agreement to reschedule Aref Investment Group’s debts of 132 million dinars ($461 million).

The rescheduling of the debts of the Kuwaiti investment company, which posted a 20.5 million dinar loss in the second quarter, “will be used to pay the group’s commitments to foreign banks and investment funds,” Kuwait Finance said in an e-mailed statement today.

Kuwait in April enacted a 1.5 billion dinar economic stability bill to bolster financial institutions suffering the fallout of the global economic crisis. The government was forced to guarantee all deposits in local banks last year as Gulf Bank KSC, the country’s second largest bank by assets, reported losses of 375 million dinars from derivatives trading, and Global Investment House KSCC, Kuwait’s biggest investment bank by assets, said in January it defaulted on most of its loan repayments.