Interview: Mohammad Saud Al Osaimi

Which new developments are helping enhance capital markets’ product and service offerings?

MOHAMMAD SAUD AL OSAIMI: Since its inception, Boursa Kuwait has been dedicated to elevating Kuwaiti capital markets by introducing products and services that not only cater to the needs of local investors, but also establish a reliable trading platform for investors on a global scale, in line with our strategic vision aimed at enhancing both transparency and liquidity in Kuwaiti capital markets.

Boursa Kuwait’s efforts have led to the reclassification of the country’s capital market as an emerging market in the world’s leading index providers, resulting in increased trading volume and value, and attracting investors from around the world. We are collaborating with Kuwait Clearing Company (KCC), to introduce a central counterparty system to manage settlement risk and enhance market efficiency. In addition, we will establish a fixed-income market for corporate bonds and sukuk (Islamic bonds) and are also planning to launch exchange-traded funds for equities and commodities.

In what ways can digital technologies improve investor experience and accessibility?

AL OSAIMI: Boursa Kuwait’s focus is on leveraging technology to enhance the capital market’s transparency and resilience. We have implemented a comprehensive digital transformation strategy, and artificial intelligence-based technologies have been integrated into our trading platforms for greater security. Furthermore, KCC has led a transformation in the way investors access our market. Our subsidiary has successfully implemented more than 15 automated processes. They have also automated omnibus account split requests for Annual General Meetings (AGMs) and introduced automation for AGM requests through a digital platform, ensuring that the AGM process is efficient and transparent.

What measures are being taken to boost the visibility of the country’s capital markets?

AL OSAIMI: Through our series of roadshows and corporate days, we provide platforms for listed companies to engage with international asset management and investment firms. In recent years Boursa Kuwait has established strategic partnerships with various international institutions to orchestrate events in financial centres like New York City and London, and in 2022 international investors accounted for 18% of total trading turnover, with institutional investors representing 61%.

Locally, Boursa Kuwait is dedicated to expanding its offerings and improving services to appeal to a broader spectrum of investors. These initiatives have yielded positive results, with traded value increasing from KD4.1bn ($13.3bn) in 2018 to KD14.7bn ($47.8bn) at the close of 2022, a 260% increase.

How is the further diversification of issuers and listings being encouraged?

AL OSAIMI: Boursa Kuwait has been conducting visits across the region since 2021 to entice companies to list on the stock exchange. As of September 2023 we had completed over 115 visits and we expect this number to have reached around 130 by the end of the year. Our outreach efforts encompass government entities, family-based businesses, and small and medium-sized enterprises looking to grow.

Market segmentation fosters diversification within our exchange. Our Premier Market, which caters to companies with substantial liquidity and medium to large market capitalisation, imposes more rigorous criteria and obligations compared to the Main Market. For instance, companies are required to establish a dedicated investor relations function, make disclosures in both English and Arabic, and commit to hosting quarterly analyst conferences with transcripts available in both languages.