Edra Energy's proposed sukuk wakalah gets AA3 rating from RAM

RAM Ratings has assigned a preliminary rating of AA3/Stable to Edra Energy (EESB)'s proposed sukuk wakalah of up to RM5.28 billion in nominal value (2017/2037).

EESB was incorporated to design, construct, own, operate and maintain the largest gas power plant in Malaysia, with a capacity of 2,242 MW combined-cycle, gas-turbine power plant in Alor Gajah, Melaka, Malaysia. Proceeds from the proposed sukuk, amounting to RM5.21 billion, will mainly be utilised to fund the construction of the plant.

The preliminary rating reflects EESB’s strong project economics, underscored by stable cashflow generation, resulting in a minimum finance service coverage ratio of 1.50 times under RAM’s sensitised case upon completion of the plant, commensurate with an AA3 rating. 

“Given the technology used in the turbine is untested and no other plant of this scale is currently in commercial operation globally, the company is exposed to technology risk,” highlights Chong Van Nee, RAM’s Co-Head of Infrastructure & Utilities Ratings. “As the plant is under construction stage and equity will be progressively injected into the project throughout the construction period, this also exposes the project to construction-related risk and uncertainty of funding.” 

The company is entitled to full available capacity payments regardless of the quantum of electricity generated, as long as it meets performance requirements under the 21-year power purchase agreement (PPA) signed with Tenaga Nasional (TNB). EESB can also fully pass through fuel costs to TNB via energy payments received from selling electricity, provided that the plant operates within heat rates stipulated in the PPA. RAM Ratings points out that the credit profile for TNB is "sturdy".

The technology risk associated with General Electric (GE)'s 9HA.02-model gas turbine, which can achieve an efficiency rate of over 60%, will be largely addressed via EESB’s long-term service agreement (LTSA) with GE for the operations and maintenance of the gas turbines, steam turbines and generators, RAM Ratings says. GE will provide further support in respect of the insurability of the plant and a special warranty to cover collateral damages.

The lump-sum turnkey engineering, procurement and construction (EPC) contract signed with Hyundai Engineering Company, Hyundai Engineering & Construction Company and Hyundai Engineering Malaysia (collectively, the EPC contractors) provides for performance guarantees, an extended defect liability period of three years and liquidated damages for delays. This mitigates construction risk, RAM Ratings said. In addition, EESB will be insured against any financial loss arising from delays. 

The company’s parent, Edra Power Holdings, is described as having a sturdy business and financial profile, which also allays concerns to some extent on funding uncertainty, RAM Ratings said. 

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MARC confirms rating of AAAIS on Islamic Development Bank's sukuk wakalah

MARC has assigned a final rating of AAA_IS to Islamic Development Bank’s (IsDB) proposed sukuk wakalah (sukuk) issuance of up to RM400 million by Tadamun Services (Tadamun), a trust established by IsDB for the purpose of issuing the sukuk. The outlook on the rating is stable.

Upon review of the final documentation of the issuance, MARC is satisfied that the terms and conditions of the sukuk have not changed in any material way from the draft documentation on which the earlier preliminary rating of AAAIS was based.

Interested?

View the definitions of MARC's ratings

Read the Suroor Asia blog post about MARC's ratings for the IsDB

MARC discusses Islamic Development Bank ratings

MARC has assigned long-term and short-term financial institution (FI) ratings of AAA and MARC-1 respectively to the Islamic Development Bank (IsDB). The ratings are on the Malaysian national scale. Concurrently, the rating agency has assigned a preliminary rating of AAA_IS to the proposed sukuk wakalah (sukuk) issuance of up to RM400 million by Tadamun Services (Tadamun), a trust established by IsDB for the purpose of issuing the sukuk. IsDB will provide an undertaking to acquire the sukuk upon maturity, early redemption or in the event of a default by Tadamun as well as to cover any shortfall in profit payments on the sukuk. The outlook on the ratings is stable.

Established by the Organisation of Islamic Cooperation (OIC) in 1975 and headquartered in Jeddah, Saudi Arabia, IsDB is a multilateral development bank (MDB) with a membership of 57 countries, most of which are from the Middle East and North Africa (MENA) and Sub-Sahara Africa (SSA) regions. IsDB undertakes financing and investment activities to support the economic development of member countries and Muslim communities across the world.

MARC’s ratings on IsDB primarily reflect the bank’s solid capital position and strong liquidity levels, which are underpinned by high shareholder support. The ratings also incorporate IsDB’s prudent financing policy that includes limits on geographical and sectoral exposures and the bank’s preferred creditor status. These strengths significantly mitigate the credit risk in the bank’s financing and investment portfolio.

IsDB’s capital adequacy levels provide significant coverage over any unexpected losses stemming from its financing and investment activities. For the Islamic year ended 1436 (FY1436H), which corresponds to October 13, 2015, the bank’s total members’ equity of ID7.8 billion (Islamic dinar*), comprising paid-in capital of ID4.9 billion and reserves of ID2.9 billion, accounted for 48.8% of total assets. As a proportion of total financing and investments, members’ equity amounted to 60.7%. The coverage ratios are comparatively higher than its peer MDBs such as the African Development Bank and the Asian Development Bank. MARC notes IsDB’s capital position is further enhanced by the bank’s callable capital of ID40.5 billion as at end-FY1436H; the bank’s callable capital constitutes contractual support that can be called upon on member countries to cover the bank’s obligations.

MARC views positively the strong financial commitment of IsDB’s key shareholders, in particular Saudi Arabia, Kuwait, Qatar and UAE (with a combined stake of 45%), to support the bank. The rating agency draws comfort from the fact that among the member countries, 47% or ID19.1 billion of total callable capital is committed by member countries rated in the A and above category on a global rating scale.

In line with its financing policy, IsDB maintains a single country exposure limit of 15% on its financing and investments to address concentration risk; its three largest country exposures Turkey (8.78%), Morocco (8.74%) and Pakistan (8.43%) are well within the limit. In terms of sectoral distribution, the bank’s inclination is towards infrastructure-related activities, namely public utilities (40.0%) and transport & telecoms (26.8%).

The bank continues to have significant exposure to sovereigns with weak credit ratings, although this has declined from 80% in 1432H to about 70% of the bank’s financing and investments. The bank makes full provisions against installment payments overdue by six months. As at FY1436H, installments overdue stood at 0.97% of total financing and investments. IsDB mitigates the credit risk by requiring explicit guarantees on all sovereign entities; financing for non-sovereigns is limited to strategic entities and projects in which the governments of member countries are major stakeholders and are guarantors of suppliers/offtakers. Given that IsDB has been granted preferred creditor status by its shareholders, the bank has priority claim over other creditors in the event of default.

MARC observes that IsDB has historically maintained a conservative leverage position, relying mainly on equity capital to fund its operations. However, in recent years the bank shifted to capital markets for funding through several sukuk issuances. This led to an increase in the bank’s gearing ratio from 79.1% in 1432H to 93.2% in 1436H; nonetheless, the bank’s gearing remains conservative, both by its own internal measures of 1.25 times members’ equity (paid-in capital plus reserves), as well as compared to its peer MDBs. IsDB is also one of the most liquid institutions among its peer MDBs, with liquid assets constituting 23.5% of total assets.

The stable rating outlook reflects MARC’s expectations that IsDB will maintain its strong capitalisation and liquidity profile, and that the bank’s member countries will continue to extend strong support.

Interested?

View the definitions of MARC's ratings

Read the Suroor Asia blog post about IsDB's work in Bangladesh

*The Islamic dinar is a unit of account used by the IsDB, that is currently equivalent to one Special Drawing Right (SDR) of the International Monetary Fund (IMF). The composition of currencies in SDR basket for the Islamic Dinar are 41.9% for US dollars, 37.4% for the Euro, 11.3% in British pounds and 9.4% in Japanese yen. The IMF declares changes in the composition of currencies in the SDR basket every five years. The last change was declared by IMF on January 1, 2011.

MARC assigns AA-IS rating to Lebuhraya DUKE Fasa 3's sukuk wakalah

MARC has assigned a rating of AA-IS to toll concessionaire Lebuhraya DUKE Fasa 3 (DUKE 3) proposed RM3.64 billion sukuk wakalah with a stable outlook. DUKE 3 was incorporated by Ekovest to undertake the design, construction, financing, operations and maintenance of DUKE Phase 3 expressway under a concession agreement with the Malaysian government in January, 2016. The concession is for a period of 53 years and six months.

The 32.1km expressway is to be elevated and link the Middle Ring Road 2 (MRR2) at Wangsa Maju to the Kerinchi Link on the Federal Highway in Kuala Lumpur.

The proceeds from the sukuk will part fund the estimated RM5.05 billion project cost; the remaining funding will come from a RM560 million interest-free government reimbursable interest assistance (RIA) and RM850 million equity. The proposed debt and equity mix of 83:17 for the Duke Phase 3 project is in line with similar MARC-rated project financing structures. The rating on the proposed sukuk wakalah incorporates the adequate cash flow coverage, the strong track record of the project sponsor, Ekovest, and the importance of the expressway in the transportation development plan for Kuala Lumpur.

The rating is weighed down by the moderate likelihood of lower-than-projected traffic growth arising mainly from competitive alternative mode of transportation. In addition, toll pricing and possible future toll hike deferments as well as the potential impact from the incremental financial obligations on the RIA may pose some risks to the project cash flow.

MARC views the construction risk on the DUKE Phase 3 project to be largely mitigated by the track record of project sponsor Ekovest, which had completed the DUKE Phase 1 project and is currently undertaking the DUKE Phase 2 project that is scheduled for completion by end-2016. A fixed sum turnkey engineering, procurement and construction (EPC) contract amounting to RM3.96 billion has been awarded to Ekovest. Given that DUKE Phase 3’s elevated alignment will pass through the densely populated areas of Chan Sow Lin, Pandan Indah and Wangsa Maju, the construction could be challenging relative to Ekovest’s other projects. Nonetheless, the construction period of 42 months is considered reasonable, while comfort is also drawn from the liquidated ascertained damages provisions under the EPC contract and the progressive buildup of 5% of the total construction cost (or RM184.5 million) over the first 18 months of the construction period to mitigate the risk of construction cost overruns. The buildup funds will be progressively carved-out from the EPC’s gross contract billings as security for the sukuk holders during construction phase.

MARC notes that as 96.5% of the 553.3 acres of land needed for the expressway are either on existing road reserves or have been acquired, land acquisition risk is considered low. The balance of the 19.6 acres is privately held, of which 6.9 acres (13 lots) in the Chan Sow Lin area are in the early stages of negotiation while the rest are at fairly advanced stages. The sizeable government funding set aside for the purchase of land parcels in the Chan Sow Lin area and the limited number of parcels involved minimise the risk relating to the land acquisition in this area.

The rating agency views that the traffic flow on DUKE Phase 3, upon its expected completion in 2020, could be affected by the availability of alternative routes and Mass Rapid Transit (MRT) system. This notwithstanding, the elevated expressway’s direct connectivity between the heavily congested MRR2 and Federal Highway as well as to other important major toll roads in the Klang Valley mitigates the risk of underutilisation. Based on the traffic study by Perunding Trafik Klasik,
DUKE Phase 3 is expected to achieve a cumulative average daily traffic of 99,840 vehicles from its four toll plazas when tolling operations begin on January 1, 2020. MARC notes that DUKE Phase 3’s relatively steep traffic growth rates in the first five years are supported by low opening traffic volume and the prevailing heavy congestion along competing routes. Excluding the traffic flow during the ramp-up period (2020-2024), traffic volume is expected to grow by a CAGR of 3.2% p.a.

DUKE 3 is projected to achieve minimum and average predistribution finance service cover ratio (FSCR) with cash balances of 2.13 times and 2.29 times respectively during the sukuk tenure. The rating agency notes that the thin project coverage levels are mainly due to the RIA loan repayment that limits DUKE 3 from building up its liquidity reserves at higher levels. The fixed repayment on the RIA will commence in 2023 together with the amortisation of the sukuk, subject to a distribution FSCR of 2.00 times. Nonetheless, the RIA repayments can be deferred (subject to an interest of 8% per annum) and has lower security ranking compared to the sukuk holders.

MARC’s sensitivity analysis reveals that the project cash flow can withstand moderate stresses arising from construction cost overruns and traffic underperformance. The project cash flow is vulnerable to a breach in the minimum FSCR covenant of 1.50 times in 2022 should the construction cost overrun exceed 10%. DUKE 3’s finance service ability would also come under pressure in the event of a 20% reduction in the overall projected traffic volume. Under these stressed scenarios, DUKE 3 is expected to defer most of its debt obligations on the RIA to protect sukuk holders from a further weakening of the cash flow coverage. Sukuk holders are protected from prolonged construction delay of up to 18 months as the prefunded finance service reserve is sufficient to cover the first three semi-annual profit payments.

The stable outlook incorporates MARC’s expectation that the project sponsor will adhere to the predetermined capital commitment under the financing structure and the construction of DUKE Phase 3 will progress on schedule and within budget.

Interested?

Refer to the MARC Definitive Ratings Guide for rating definitions (PDF, page 54)

MARC rates Putrajaya Bina's sukuk wakalah programme AAAIS

Ratings corporation MARC has assigned a preliminary rating of AAA_IS with a stable outlook to Putrajaya Bina's (PB's) proposed Islamic medium-term notes (sukuk wakalah) programme of up to RM1.58 billion. An AAA rating from MARC denotes an "extremely strong ability to make payment on the instrument issued under the Islamic asset-based financing contract(s)".

Proceeds from the issuance will part fund the RM1.9 billion development costs for nine blocks of government office buildings and one block of shared facilities that PB will undertake under a concession from the Malaysian government.

Based on a private finance initiative, the development entails two phases: three and a half years for construction and 25 years for asset maintenance. Putrajaya Holdings (PJH), as a PB shareholder, will contribute RM380 million in the form of shareholders’ advances to meet an 80:20 finance-equity ratio requirement. Upon completion of construction and one month after receipt of the certificate of acceptance, PBSB will be entitled to receive concession payments in the form of availability charges (AC) of RM215.6 million per annum and asset management service charges (MC) of RM69.2 million per annum for tenancy of the building from various ministries and government agencies.

The assigned rating is driven by the credit strength of the government which provides the AC and MC payments over the tenure of the sukuk wakalah programme. The sufficiency of the quantum of the annual AC payments alone without considering the MC payments to meet the principal and profit payments under the sukuk wakalah programme is also a key consideration. The rating also incorporates an irrevocable and unconditional letter of support (LoS) from PJH to meet PBSB’s financial obligations, including any cost overruns during the construction period. MARC maintains a long-term rating of AAA/stable on PJH.

The project construction, which commenced in Q415 and is expected to be completed by Q418 is being undertaken by Sunway Construction under a fixed-price contract. MARC considers the completion and cost overrun risks to be mitigated by the moderate complexity of the project, the established track record of the principal contractor Sunway Construction and the terms of the fixed-price contract. PJH’s obligations under the LoS which will remain effective until the date of the first AC or MC payment, whichever is later, alleviates the payment risk in the event of delay. Notwithstanding this, should the concession be terminated during the asset management period on default of the government, PB will be entitled to a compensation amount of the net present value of foregone future AC payments discounted at the company’s weighted average cost of capital.

Interested?

Find out more about MARC's rating definitions (PDF; from page 53)

Alia successfully closes dual conventional and Islamic secured synicated facility

Alia, rhe Royal Jordanian Airlines (RJ), the national flag carrier of the Hashemite Kingdom of Jordan, has announced the successful closure of its US$275 million dual conventional and Islamic secured syndicated facility. The facility exceeded the initial target amount, exemplifying the synergies developing between the Middle East and Levant region.

The syndicate comprised of seven banks based in UAE, Jordan and Qatar: Mashreq Bank, Arab Bank, Al Khalij Commercial Bank, Dubai Islamic Bank, and The Commercial Bank/Qatar acting as mandated lead arrangers, Arab Jordan Investment Bank as lead arranger and Bank al-Etihad as arranger. Mashreq Bank acted as the sole book-runner for the transaction.

Through its distribution network of regional partners, Mashreq endeavoured to meet Royal Jordanian Airlines' financing requirements and diversify its funding sources to GCC-based conventional and Islamic banks. The transaction successfully encompassed a hybrid structure with a dual conventional and an Islamic (wakalah) tranche.

Chairman of Royal Jordanian Board of Directors Suleiman Hafez said: “Royal Jordanian Airlines has successfully secured a hybrid structured debt instrument as part of the airline’s on-going strategic capital raising programne, to support its intensive turnaround and growth plans to evolve into one of the leading airlines in the Levant and Middle Eastern region. This syndication reiterates the airline’s access to avail international liquidity, with the same success it has accomplished with Jordan based financial institutions.” 

Captain Suleiman Obeidat, President/ CEO of Royal Jordanian, said: “We would like to show our gratitude to Mashreq Bank and other participating banks for the successful closure of this deal, which will support the airline’s well-studied plans to carry out network expansion and fleet modernisation, particularly that RJ will introduce more 787s to its fleet by the end of this year. Today five 787s (have been) operating in the fleet since 2014.”

Salman Gulzar, Head of Corporate Banking at Mashreq Bank Qatar stated: “The successful closure of this transaction by Mashreq Bank in these uncertain times demonstrates the trust and confidence we and our partner banks have in supporting reputable and strong Levant-based corporates in the regional and international debt market. Jordan has always been a strategic market for Mashreq Bank and we remain committed to working alongside our core relationship clients like Royal Jordanian to execute innovative financial solutions aimed at supporting their business plans and creating efficiency in their operations."

The facility carries a tenor of five years and the proceeds of the facility will be primarily utilised to consolidate and refinance RJ’s existing debt and further support the company’s strategic growth and turnaround plans in the short- and medium-run.

Malaysia's Shariah Advisory Council refines rulings on Islamic finance at 165th meeting

The Shariah Advisory Council (SAC) of the Central Bank of Malaysia recently discussed on the issue of application of tabarru` (تبرع voluntary gifts) contracts in takaful, transfer of ownership of hibah (هبة) assets, breaches of condition in wakalah bi al-istithmar contracts (وكالة لابالاستثمار agency contracts for investment) and wa`d (وعد promise) which is attached to action, time or situation.

The SAC has decided the following at its 165th meeting dated 26 January 2016:

Application of tabarru` in takaful

• The underlying concept/principle for takaful scheme is tabarru` and ta`awun (تعاون mutual assistance) among the takaful participants.
• Tabarru` in takaful is applied through contributions from the participants to the tabarru` fund which is managed by (and entrusted to) the takaful operator in the interest of takaful participants, based on the agreed terms and conditions.
• The financial obligations (الذمة المالية zimmah maliyah) of a tabarru` fund are independent of the financial obligations of the takaful operator and the individual takaful participant. 

Transfer of ownership of hibah assets to the hibah recipient

The SAC has decided that in hibah contracts the ownership of the hibah asset is generally transferred effectively once the hibah recipient takes the possession (قبض qabd) of the hibah asset physically or constructively. This forms the basis for transfer of ownership of hibah asset. Without qabd, the donor may still revoke the hibah. 

However, in conditional hibah, the ownership of the hibah asset is effectively transferred to the hibah recipient upon the occurrence of agreed conditions. This forms the basis for transfer of ownership of hibah asset in conditional hibah. As such, in conditional hibah, it is not possible for the donor to revoke the hibah upon the occurrence of the agreed hibah conditions even though the hibah recipient has yet to take possession of the hibah asset physically or constructively. Notwithstanding this, hibah which is attached to the condition of the demise of the donor shall only be applicable in the context of takaful. This is to provide certainty to the beneficiary in relation to his ownership of the takaful benefit upon the demise of the donor/participants even though he has not yet taken possession (qabd) of the hibah asset, in this case, the takaful benefit.

Breach of conditions in wakalah bi al-istithmar contracts

The SAC has decided that in the event of breach of condition by wakil (وكيل agent) under the wakalah bi al-istithmar contract, in line with its ruling in the previous 150th SAC meeting, the wakil shall guarantee:

• Investment capital; and
• Actual profit generated up to the date of breach of condition. 

In addition to the above, the SAC has decided that the investor (الموكل muwakkil) is eligible to claim actual cost incurred due to the breach of condition by the wakil.

In the event of breach of condition that results in higher-than-expected profit, the excess profit shall be treated based on the agreed terms and conditions in relation to performance fee. If the terms and conditions are not stipulated or not agreed, the excess profit is subject to the discretion of the muwakkil. 

This ruling is based on the principle that wakil performs his duty on the basis of trust (أمانة amanah) and he is not allowed to guarantee the investment capital and profit except in the event of misconduct, negligence and breach of condition by the wakil. This is in line with the opinion by several fuqaha (فقهاء experts in Islamic law) that allow sharing of profit in mudarabah in the event of breach of condition by the mudarib (مضارب manager). In addition, the permissibility to claim actual cost incurred due to the breach of condition by wakil is a form of penalty for the breach and also intended to emphasise on the aspect of amanah and discipline on the wakil.

Wa`d attached to action, time or situation

The SAC has decided that wa`d is binding (ملزم mulzim) on the promisor if the wa`d is attached to any of the following:

• A particular action which is done by a party including the promisee in the future;
• A particular time or date; or
• A particular situation which will occur in future. 

This ruling is based on the view of fuqaha that wa`d which is attached to conditions is binding. The types of conditions, which are attached to the contract as outlined by fuqaha that include a particular action, date/time and situation may be applied in the context of conditions attached to wa`d.

This ruling may clarify the types and categories of conditions attached to wa`d that lead to the bindingness of wa`d, especially in the financial instruments that involve promise to enter into contract that is attached to a particular date/time in the future.

Interested?

Read the hibah concept paper from BNM dated January 2016 (PDF)

IFSB Annual Summit to discuss prudential and supervisory infrastructure for Islamic finance

The 12th Annual Summit of the Islamic Financial Services Board (IFSB) will be held on 20 and 21 May 2015, in the commercial capital of Kazakhstan, Almaty. The Summit is aimed at harnessing the latest developments and innovation in regulation, prudential standards, current market practices and future challenges to keep stakeholders informed about the global Islamic financial services market; to provide a platform for dialogue with peers; and to give delegates a voice in contributing to the future direction of the industry.

According to the organisers, the Islamic finance landscape is populated by sovereign sukuk issuances by non-traditional markets such as the UK and Hong Kong; reforms underway in both Asia and the Middle East to integrate Islamic finance into governmental budgets; and increased interest from international institutions such as the International Monetary Fund and the World Bank. 

Developments such as new IFSB standards on stress testing, liquidity management, capital adequacy are occurring alongside strong private sector activity, the organisers note, especially on the sukuk front: 

• The Islamic Corporation for the Development of the Private Sector (ICD), the private sector funding arm of the Islamic Development Bank (IDB) Group has won mandates from Jordan, the Ivory Coast and Senegal to assist them in issuing sukuk. 
• Dubai’s Noor Bank recently debuted a US$500 million sukuk wakālah. 
• Kuveyt Turk Participation Bank inaugurated a RM300 million sukuk murābahah in the Malaysian market. 
• The syndicated sukuk murābahah market helped AlBaraka Turk Participation Bank raise US$268 million.
• The first sharī`ah-compliant insurance product was launched through Lloyd’s of London by XL Group and Cobalt Underwriting.
• The Central Bank of Bahrain launched a new wakālah liquidity management instrument.

The transformational impact of the Islamic finance industry can only be truly enhanced if the requisite prudential and supervisory infrastructure is in place. As such, issues relating to Core Principles for Islamic Finance: Integrating with the Global Regulatory Framework, the Summit theme, require discussion. Discussions at the 12th IFSB Summit in Almaty with focus on the new regulatory developments, policy and market trends in the global Islamic financial services industry, concluding with a panel on The New Silk Road: The Importance of Regulatory Cooperation for Cross-Border Integration.

Need background? Read the Suroor Asia blog posts:

IFSB introduces core principles for Islamic finance
IFSB launches indicators for soundness and growth of Islamic finance banking systems 
ADB and IFSB launch book on Islamic finance for Asia

KFH launches Al-Nuwair wakalah deposit

Kuwait Finance House (KFH) has launched the Al-Nuwair investment deposit, a type of deposit that promises clients expected profit rates as per shari'ah law for the Islamic wakalah contract. Wakalah is often translated as 'agency' or 'power of attorney'.

Executive Manager of the Savings and Investments department at KFH, Mohammed Ghandour, stated that the deposit, which has numerous advantages and features, comes as part of KFH’s efforts to offer its clients new investment opportunities that cater for their investment needs.

Ghandour added that the Al-Nuwair deposit is distinguished by its Islamic wakalah structure, under which KFH acts as an agent on behalf of the clients to manage their investment activities. 

In contrast KFH promises the clients with expected profit rates based on different investment periods, noting that the deposit allows clients to receive returns without the need to wait until end of the fiscal year. In addition, clients can withdraw up to 30% of the invested amount without having to cancel the deposit.

Moreover, he explained that Al-Nuwair provides flexible investment tenures ranging from one month to three years and clients can identify the tenure of investment by the number of days starting from a minimum of 30 days. He indicated that clients can reinvest their profits at each renewal date to achieve higher returns; they can also pre-request modification of the invested amount of the deposit at maturity date.

He noted that the minimum deposit for this deposit account is KD5,000, and KFH can arrange for high investment returns for deposits with KD50,000 and more. The deposit is available to all individuals and corporate entities and can be opened through KFH branches.