CBK reports sharp drop in FX reserves and assets amid strong reserve base growth

New figures released by the Central Bank of Kuwait for 2025 reveal a marked drop in foreign exchange holdings and other financial assets, even as core reserves and operating accounts showed notable increases.

According to the data, the bank’s foreign exchange reserves — which include cash, foreign bonds, treasury bills, certificates of deposit, and foreign currency deposits — fell by 10.37 percent over the year.

This represents a reduction of 1.254 billion dinars, bringing the total to 10.833 billion dinars by December 2025, down from 12.087 billion dinars in December 2024. On a monthly basis, these reserves also edged down by 0.3 percent, or 41.2 million dinars, compared to November.

Overall asset balances mirrored this decline, with totals contracting by roughly 11 percent year-on-year — about 1.379 billion dinars — to reach 11.12 billion dinars at the end of December, compared to 12.5 billion dinars at the close of 2024. Monthly asset figures also dipped slightly versus November.

Government accounts at the central bank were similarly affected, shrinking by nearly 18.9 percent, a drop of 319 million dinars to 1.371 billion dinars from 1.69 billion dinars the year before. These accounts also declined by around 4.76 percent, or 80.6 million dinars, in December relative to the previous month.

On a brighter note, the bank’s capital base and general reserve saw a strong upward trajectory, rising by 33.88 percent — an increase of 491.9 million dinars — from 1.451 billion dinars to 1.943 billion dinars as of December. This growth underscores an enhanced financial foundation for the Central Bank.

Longer-term government bonds held by the central bank remained unchanged at 120 million dinars in December compared with November, but they plunged sharply by 86.4 percent year-on-year — a decrease of roughly 765 million dinars from 885 million dinars.
Accounts and deposits maintained by local banks with the Central Bank also contracted significantly over the year. These balances fell by 11.27 percent (about 616 million dinars) to 4.848 billion dinars, down from 5.464 billion dinars in December 2024, and declined by approximately 1 percent month-on-month compared to November.

Other areas of the balance sheet reflected further shifts: gold holdings remained constant at 31.7 million dinars, other assets slipped by roughly 32.5 percent (124.7 million dinars) to about 258.6 million dinars, and currency in circulation dipped by 2.75 percent (54.5 million dinars) to 1.931 billion dinars compared with December 2024, though it edged up slightly on a monthly basis.

Total liabilities of the Central Bank saw an 11.03 percent decline (around 1.378 billion dinars) to 11.11 billion dinars, continuing a downward trend from 12.5 billion dinars the previous December.

On a monthly basis, liabilities also decreased slightly. Other liabilities contracted by about 6.7 percent to 650.1 million dinars year-on-year. Meanwhile, the balance of international institutions grew modestly by 5.8 percent to 45.1 million dinars.

In contrast to declines in many asset categories, regular accounts — which reflect routine central banking operations — surged by 58 percent, increasing by 2.315 billion dinars to reach 6.305 billion dinars. This jump suggests heightened transactional activity within central banking functions during 2025.