Burgan Bank plans $74.8m rights issue

20/10/2014 07:19 AST

Burgan Bank, Kuwait’s third-largest lender by assets, will launch a 21.6 million dinars ($74.8 million, Dh275 million) rights issue by the end of 2014 pending regulatory approvals, it said in a bourse filing on Sunday.

Burgan said it plans to issue 216 million new shares and that the rights issue will raise its paid-up capital to 197.18 million dinars. This would indicate that shares would be priced at 0.1 dinars in the rights issue, a significant discount to the 0.54 dinars the stock closed at on Thursday.

The shares will be available to existing shareholders on a proportional basis and any unsold shares will then be put on general sale, the bank said in the statement.

Kuwait Projects Company (KIPCO), which owns a 57.94 percent stake in Burgan, had said in September that it received approval from the country’s central bank to increase its stake in the lender by 5 percent.

Meanwhile, Kuwait's Gulf Bank, fourth-largest lender by assets, reported a 11.2 percent rise in third-quarter net profit on Sunday, according to Reuters calculations.

The bank made a net profit for the three months to the end of September of 10.9 million dinars ($37.8 million), compared to 9.8 million dinars in the year-earlier period.

Gulf Bank didn't provide a quarterly breakdown so Reuters calculated the figure based on the bank's financial statement for the first nine months of the year.

Net profit for the first nine months of the year rose by 10 percent to 26.5 million dinars, compared to 24.1 million dinars in the year-earlier period, the bank said.

Global Investment House had forecast a third-quarter net profit of 10.1 million dinars, while EFG Hermes forecast a net profit of 8.3 million dinars.

Reuters