Grim outlook for Kuwaiti banks, but some still recruiting
Kuwait is embroiled in something of a conflict over just how many people have lost their job as a result of the financial crisis, with figures ranging from 904 to 4,500. But while it remains gloomy for local banks, they're somewhat divided when it comes to recruitment far this year.
MPs in the country had earlier claimed that 4,500 people in the Kuwaiti private sector had lost their jobs, but the state is now suggesting that just 904 have been laid off.
Understandably, this is causing something of a furore in the country among those affected, and echoes similarly confusing information released earlier this year, when a workers union claimed banks were laying off staff - but wouldn't name the firms.
Global Investment House is continuing to pare back its staff costs - having cut jobs and bonuses in the first quarter. After a second quarter loss of KD29m ($101m) it says it "continues to work towards reducing its operating cost base".
Staff costs were down 53% year on year to KD4.6m ($15.9m).
Gulf Bank also posted a second quarter loss of KD5.9m ($20.5m) and is understood to have made some redundancies since the start of the year.
Kuwait Finance House (KFH), the country's second largest Islamic lender, posted a 61% fall in second quarter profits, to KD72m ($250m). However, staff costs swelled to KD55.4m ($192.7m) over the first half of the year - a 21% increase year on year.
The National Bank of Kuwait (NBK) has managed to post a KD126.1m ($439m) profit in the first half and increased its staff costs in the second quarter by 6% year on year. Both KFH and NBK have signalled their intention to expand in the region this year.
However, Peter Jones, director of Middle East focused headhunters MRK Consulting, says that he's seen very little hiring activity coming out of the Kuwait banking sector so far this year, and any potential recruitment is still "somewhat anecdotal".
Sadly, it doesn't look like getting better any time soon. A recent report by ratings agency Fitch, said that a contracting economy combined with exposure to risky asset classes means Kuwaiti banks are exposed to "significant market induced credit risk".
