The Kuwait Capital Markets Authority issued a Disciplinary Board decision sanctioning Kuwait and Middle East Financial Investment Company (KMEFIC) for breaches of capital adequacy requirements for licensed persons and the rules on valuation of real estate assets. The authority found that KMEFIC’s capital adequacy ratio fell below the legal limit, driven mainly by investments in financial institutions that resulted in KWD 10.4 million of deductions from eligible capital, with reported ratios of 18% at 30 September 2023 and 14% at 31 December 2023 before rising to 28% at 31 March 2024. It also cited a delay in revaluing property based on a bank valuation, with the valuation completed on 3 March 2024 after the required period for the 31 December 2023 financial statements. Penalties comprised a KWD 5,000 fine for the capital adequacy breach with a requirement to address eligible regulatory capital to reach 100% or more of the risk-based capital requirement, and a further KWD 1,000 fine for the real estate valuation breach.
Kuwait Capital Markets Authority 2025-01-13
Kuwait Capital Markets Authority fines KMEFIC KWD 6,000 and orders remediation for breaches of capital adequacy and real estate valuation rules
The Kuwait Capital Markets Authority sanctioned Kuwait and Middle East Financial Investment Company (KMEFIC) for breaching capital adequacy requirements and real estate asset valuation rules. KMEFIC's capital adequacy ratio fell below the legal limit due to KWD 10.4 million in deductions, with penalties including a KWD 5,000 fine and a requirement to restore regulatory capital to 100% or more of the risk-based requirement. An additional KWD 1,000 fine was imposed for delayed property revaluation.