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No restrictions on the Kuwaiti banks in their dealings with foreign banks
KUWAIT (Reuters)
Kuwait's central bank expected to abide by Kuwaiti banks with its internal controls and issued by the Central Bank of regulations in its dealings with foreign banks derivatives indicating that it did not put restrictions or new regulations in this regard, which is an indirect confirmation of the lifting of the ban on dealing in derivatives. He said the governor's office, "according to the dissemination of the Central Bank of Kuwait in October 12, 2006, banks in Kuwait is permitted to foreign currency exchange against the Kuwaiti dinar as well as transactions in the futures exchange market." "We would like to make it clear that the instruments should be quite clear in nature and that are used in hedging or trading purposes. Therefore, such tools are not complex or structured derivatives and related speculative nature."
The Reuters inquiries about whether the central bank has already allowed the Kuwaiti banks dealing with derivatives of the new post-crisis that occurred in 2008 in which Gulf Bank of Kuwait hit hard because of dealing derivatives and whether there are new controls to prevent a repeat of what happened in the past.He predicted a statement the governor's office that Kuwaiti banks maintain adequate internal controls to comply with the regulations of the Central Bank of Kuwait in dealing with these tools as usual. "We want to reiterate that this is not a new circular or revised guidance on the matter referred to above. The banking system risks remain under control and are subject to good management and good supervision in connection with the use of such tools."
The Kuwaiti newspaper Al-Rai said on Monday in a report that the Central Bank of Kuwait, Kuwaiti banks were allowed to deal in derivatives with foreign banks after they had been banned during the outbreak of the global financial crisis in the 2008 Gulf Bank of Kuwait has been hit hard by the deal. The newspaper quoted unnamed sources as saying that the Central Bank of Kuwait, "the most dangerous treasury managers in banks, it is no longer reluctant Kuwaiti banks deal market derivatives with foreign banks but with an inventory of these trading products that are compatible with the central bank law, which already central to the development of a list of them."
He dealer at Bank of Kuwait in connection with Reuters Health report indicating that the Central Bank of Kuwait had informed the Kuwaiti banks new to its policy at a meeting held last Sunday. Following the publication of this report, the Kuwaiti dinar rose strongly against the US dollar in the futures market as traders bet that excess liquidity in the market will reduce the difference between the interest rate on the two currencies.
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KUWAIT (Reuters)
Kuwait's central bank expected to abide by Kuwaiti banks with its internal controls and issued by the Central Bank of regulations in its dealings with foreign banks derivatives indicating that it did not put restrictions or new regulations in this regard, which is an indirect confirmation of the lifting of the ban on dealing in derivatives. He said the governor's office, "according to the dissemination of the Central Bank of Kuwait in October 12, 2006, banks in Kuwait is permitted to foreign currency exchange against the Kuwaiti dinar as well as transactions in the futures exchange market." "We would like to make it clear that the instruments should be quite clear in nature and that are used in hedging or trading purposes. Therefore, such tools are not complex or structured derivatives and related speculative nature."
The Reuters inquiries about whether the central bank has already allowed the Kuwaiti banks dealing with derivatives of the new post-crisis that occurred in 2008 in which Gulf Bank of Kuwait hit hard because of dealing derivatives and whether there are new controls to prevent a repeat of what happened in the past.He predicted a statement the governor's office that Kuwaiti banks maintain adequate internal controls to comply with the regulations of the Central Bank of Kuwait in dealing with these tools as usual. "We want to reiterate that this is not a new circular or revised guidance on the matter referred to above. The banking system risks remain under control and are subject to good management and good supervision in connection with the use of such tools."
The Kuwaiti newspaper Al-Rai said on Monday in a report that the Central Bank of Kuwait, Kuwaiti banks were allowed to deal in derivatives with foreign banks after they had been banned during the outbreak of the global financial crisis in the 2008 Gulf Bank of Kuwait has been hit hard by the deal. The newspaper quoted unnamed sources as saying that the Central Bank of Kuwait, "the most dangerous treasury managers in banks, it is no longer reluctant Kuwaiti banks deal market derivatives with foreign banks but with an inventory of these trading products that are compatible with the central bank law, which already central to the development of a list of them."
He dealer at Bank of Kuwait in connection with Reuters Health report indicating that the Central Bank of Kuwait had informed the Kuwaiti banks new to its policy at a meeting held last Sunday. Following the publication of this report, the Kuwaiti dinar rose strongly against the US dollar in the futures market as traders bet that excess liquidity in the market will reduce the difference between the interest rate on the two currencies.
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