Capital budgeting Project for Kuwait Finance House - KFH (2000 words)

May 2016 | 11 pages | ID: C6F8A83BA3BEN
Sadia Saeed

Abstracts

This is a supposed task dfor which i select Kuwait finance house (KFH). Kuwait Finance House is also known as Islamic Finance or Shari’a Compliant Banking and it is one of most growing banks in Kuwait. It provides services in various countries like Kuwait, Kingdom of Bahrain, Kingdom of Saudi Arabia, United Arab Emirates, Turkey, Malaysia, and Australia. In 1977, KFH was established in Kuwait. It provides services related to real estate, trade investment, investment portfolios, commercial, retail and corporate banking (KFH, 2014).

The manager of Kuwait Finance House has been proposed two projects to CEO Abdul-hakeem Y. Al-Khayyat. The CEO might invest in one or two projects. The 1st project is about development of online billing system. 2nd project is related to construction of new branch in rural area. The projects will be named as Project A and Project B respectively.

Contents

Introduction
Expected Cash flows from projects
Project A
Project B
Mutually exclusive projects
Independent projects
Risks inherent in projected cash flows to determine appropriate rate of return
Project Risk
Business Project Risk
Project evaluation through calculating Net Present value, Internal Rate of Return and Payback period
Net Present Value (NPV)
Project A
Project B
Internal Rate of Return (IRR)
Project A
Project B
Payback Period (PB)
Project A
Project B
Discounted Payback
For Project A
For Project B
Conclusion
Work Cited