The oil-rich emirate's central bank had earlier announced that a draft law would be urgently submitted to parliament to guarantee bank deposits after it was found that the second largest lender made losses in derivatives trading.
The Central Bank of Kuwait said that it had decided to appoint a supervisor for the Gulf Bank operations in management of treasury, forex and share deals.
But it affirmed that the bank's position was strong and it was fully capable of providing its normal banking activities.
Ibrahim Dabdoub, the chief executive officer of the National Bank of Kuwait, the largest in the emirate, meanwhile called for the suspension of trading on the stock market.
"If I were the man responsible for the stock market, I would order an immediate suspension of trading because of panic trading," he told the CNBC Arabiya satellite channel.
Markets across the region opened low on Sunday amid gloomy economic prospects.
The Kuwait Stock Exchange Index shed 3.2 per cent while the Saudi stock market opened down 3 per cent. Markets in Qatar and Dubai also showed a downward spiral.