Burgan Bank, Kuwait’s third-largest lender by assets, is gearing up to enter Saudi Arabia in the new year through a full acquisition of asset manager Kamco Invest, according to two sources familiar with the matter.
Once Burgan secures its commercial banking license in Saudi Arabia, Kamco Invest Saudi will transition into the investment banking arm of Burgan Bank Saudi, the sources tell MONIIFY.
“This will boost the share of retail money for the bank in the kingdom, ultimately becoming part of the broader investor base,” one of the sources says.
Burgan Bank declined to comment on the development. Kamco Invest and KIPCO, a major shareholder in both companies, did not respond to MONIIFY’s requests for comment.
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Kamco Invest, which has a strong presence in the kingdom, managed $15.9 billion in assets as of June 30, 2024, and has facilitated over $38.7 billion in equity, debt, and M&A transactions to date, giving Burgan a solid foothold in an increasingly competitive market.
It’s listed on the Kuwaiti stock market and has a market cap of 43.1 million Kuwaiti dinars or $141 million.
Saudi Arabia: A sweet spot?
Burgan is one of a string of global players and regional heavyweights looking to set up shop in Saudi Arabia. The race has heated up since the oil-exporting kingdom announced in 2021 that any foreign company wanting juicy government contracts would be expected to set up their regional HQ in the kingdom.
To sweeten the deal, Riyadh is offering:
- A 10-year exemption from “Saudization”.
- 30-year tax breaks (yes, you read that right).
- No withholding taxes on HQ activity.
- Visa limit exemptions and issuance acceleration.
- Government tendering priority.
Big names like Goldman Sachs, Citi and Morgan Stanley have already grabbed their regional HQ licenses.
Read more: Saudi banks are poised to beat UAE peers, says Goldman
Burgan Bank won regulatory approval in July to buy Bahrain’s United Gulf Bank, which owns 60% of Kamco Invest. Once the acquisition is complete, the Kuwaiti lender plans to buy the remaining shares, a spokesperson for Burgan says.
