* Increase could come in second half of the year
* Perpetual bonds are one option
* Bank needs to increase capital by 20-30 percent
(Adds details, more quotes)
KUWAIT, March 31 Kuwait's Burgan Bank
wants to raise more capital this year to comply with the Basel
III banking industry regulations while any acquisitions were
unlikely to come soon, the lender's chief executive said on
The increase, which may happen in the third or fourth
quarter of this year, could be "pure capital" or perpetual bonds
or both, CEO Eduardo Eguren said, depending on discussions with
regulators and shareholders.
"We are discussing this with the central bank," he told
reporters on the sidelines of the bank's annual general meeting.
"I know that we may need to increase capital by 20, 30
percent for sure," he said, without giving an exact figure.
The bank only wants to issue perpetual bonds if they counted
towards capital ratios, he said.
The bank's chairman said in November that Burgan wanted to
issue a bond of up to 150 million dinars ($530 million) early
In terms of potential acquisitions, Egypt, Saudi Arabia and
the United Arab Emirates continue to be attractive, Eguren said.
"I see opportunities all around," he said, adding: "I have
targets, but this year is not the moment. We have to continue
delivering and growing as we are right now, making sure Turkey
works well," referring to the Turkish unit of Greek bank EFG
Eurobank, which Burgan bought in 2012.
Burgan is the commercial banking arm of conglomerate Kuwait
Projects Company. In May, KIPCO used Burgan and
another subsidiary, United Gulf Bank, to take a
majority stake in Malta's Fimbank, which specialises in
Eguren said it was important to "let the dust settle a
little bit" in Egypt before considering acquisitions, in
reference to political upheaval in the country.
There were also drawbacks to other potentially attractive
markets, he said. Saudi Arabia is expensive and local regulators
are reluctant to allow foreign companies to enter, while the UAE
had too many banks but was still a critical market.
Burgan reported a big drop in fourth-quarter net profit last
month, according to Reuters calculations, with its full-year
earnings also significantly lower than the previous period.
($1 = 0.2816 Kuwaiti Dinars)
(Reporting by Sylvia Westall; Editing by Yara Bayoumy and Toby