Gulf Bank Ran Out Of Cash!
Without a close followup on the news, I’ve been hearing quite a lot about banks going bankrupt in Kuwait, and how only two or three will manage to stand up. Gulf Bank was the first to shout ou loud “We Are Sinking!”, something which forced th Central Bank of Kuwait to freeze Gulf Bank stock from trading, and I guess opening the door for more similar cases, and perhaps increasing demand for the close of whole stock market, which is something completely out of logic if you ask me. This is the market, you know the rules, you know the risks. At least, you should’ve known before you go into it. Don’t try to change the rules during the game.
So anyways, I read yesterday Central Bank is issuing guarantees to cover up bank losses, in an attempt to calm down people who are rushing to take out all their money. Regardless of this guarantees I say, if a bank is not capable enough of staying in business, they should step a side and make room for others. That same bank offered me 50 times my salary loan one year back. Tells the whole story doesn’t it?
A relative of mine went today to Gulf Bank to withdraw some money, and the bank said we don’t have money. You should’ve come earlier! Now that’s more than a good enough reason to pull my money out permanently, and it’s no rumors anymore. The bank is not capabale of giving back people’s money. Either that, or they are trying to trick people into it. At all rates, a bank at these conditions should not be running such type of ads:
Ironically, those type of ads are still running online.
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Comments
You said, “A relative of mine went today to Gulf Bank to withdraw some money, and the bank said we don’t have money. You should’ve come earlier! Now that’s more than a good enough reason to pull my money out permanently, and it’s no rumors anymore.”
I’m not sure if you were aware of that, but as per Central Bank law, and as per the agreement with the insurance companies, The branch is only allowed to maintain a certain amount of cash on a daily basis.
Therefore, and due to the current situation, the branches yesterday did not have enough cash to accomodate the requirements of their clients. Does that mean Gulf Bank cannot & wont pay their depositors money?
The answer is, Gulf Bank can pay all their depositors money, but due to the regulations set by CBK, yesterday (only yeaterday) they could not coz they did not inform the head office to send them cash, on order to accomodate their client’s requirements.
Do me a favor and ask your relative to go today to Gulf Bank branch… sure there might be lots of customers waiting in line. But I assure you they will pay him/her their money.
wallah illi sawooh inas 3eeb, 3EEB!!! this is KUWAIT!!!! the central bank ya’6min flos il mwa6neen 7ata law 5asar il bank…. bs shagool….. no words!
forzaq8: I don’t have certain numbers, but I’m sure wat you’re saying is right. They can’t keep large enough liquidity. Still however, under current circumstances, it is wise to withdraw all your money. You never know when you’re gonna need it. And when you do, you may be begging for it!
Essa: The fact that my relative as you quoted went TODAY proves they are having big problem. So it was not only yesterday. Thanks though for the tip on amount of cash. Still, I would prefer to keep my money somewhere accessible.
Blasha: Well, I’m sure no one will lose his money. But I personally run into circumstances where I need the money now, or else I will lose in some investment. Tomorrow may be too late, and that is not a bank I can rely on.
Marzouq: I’m sure money is fine, but I’m talking about people who wanted their money today, as in they needed it, and they couldn’t. Personally, if it happens to me, I doubt I can trust this bank again.
The problem I have with GBK is, they say their short comes from those who are not welling to pay their debts, when in fact, GBK and many other banks have been promoting those exaggerated (50 times your salary) loans, beyond people’s ability, and now they are putting all the blame on the non-paying customers. The fact that they were encouraging those large loans makes them as guilty as the customers, or even more guilty.
Maze: I could be wrong somewhere, not sure where you mean. However the fact that on the day of the post (yesterday) people were not able to withdraw money stands true, and is pretty bad for a bank this large. Essa was pointing this was only a day before, when my relative actually tried the next day (day of post) and problem still exists.
Ansam: They are least worst. I heard however they are giving away their best talents to competitive banks, and are struggling on many things. For example, their online system, and credit card system are continuously under going upgrade! Being in this shoes before I can tell this only means big crisis inside. My VISA Internet Card shows weird records and they told me I need to visit their CC branch! How convenient! It’s software problem, they should be able to fix it without me coming in person.
Why you want to take all your money out of the bank? Why can’t you trade with the bank if you are smart enough. I normally have my plans for 1 year and take money from my banker in upfront and pay them back in 1 year. I never stay in a window where there might be a chance when i will bear the loss if the banker closes its door. I will be a gainer at any point of time.
What made the situation worse is the people who went there to pull out all their money making the situation even more hectic on the bank.
Even though the bank wasn’t bankrupt that move by their customers almost made it announce its bankruptcy, but they were relatively smart enough to limit cash withdrawal to 60 KD only, otherwise bye bye Gulf Bank.
Bas allah yastir “Le 6a7 el jamal kethrat sichacheena” *Hint*. :p
Sorry for late reply. Have been under the weather for past 3 days.
tone health: Sorry I may not be following you 100%. Do you mean take a loan for my plans 1 year ahead, or withdraw the money I need one year ahead? Either case I wouldn’t want that much money in my hands :). And sometimes, opportunities rise all of a sudden and you need to grasp them. Hope my reply is relevant :)
MacaholiQ8: OUCH!!! 60 KDs wont pay your phone bill. That’s too low. I’m not Gulf Bank customer if you’re hinting at me :). Never dealt with them. In all cases, the bank have put it self into this situation by over giving loans, and I don’t believe a customer should be punished with 60 KD limit. I understand their standing point to save their neck, but still the fault is theirs in the first place in my opinion.
Ansam: Yeah, maybe. I never went though :P.
no bank in the world keep more than 10% liquidity , any more withdrawing and its problem for them to cover it
so unless the CBK take over by giving him the cash he need now and making sure that he has assist to cover it all , the bank is going under