State departments ordered to withdraw from deposits

KUWAIT: As preparations are on to launch the first issuance of sovereign sukuk and enroll them at Kuwait Stock Exchange for trading in cooperation with a specialized mission from the International Monetary Fund (IMF), state departments have been given verbal instructions to cover any future needs, by withdrawing from their deposits in foreign or local banks.

Information received on that regard indicated that the Public Institution for Social Security (PIFSS) expressed readiness to underwrite half a billion Kuwaiti dinars this year, and the same amount next year, while Kuwait Petroleum Corporation (KPC) offered the same, as the Finance Minister is waiting for answers from other government bodies about the amount of money that they can allocate to underwrite in government bonds.

Sources said the Finance Ministry is preparing to exchange due transfers to the PIFSS, with sovereign debt bonds in order to spare the banking system the dues of funds transfer cycle from and to the Finance Ministry. PIFSS told the Finance Ministry that it can exchange half a billion dinars only with a Sovereign debt bonds, and prefers to get the rest of dues in cash which is nearly one billion dinars. The bonds term varies between three to five years with less than two percent interest.—Al-Rai