MANAMA: Restructuring at Gulf Finance House (GFH) has seen the Bahrain-based Islamic investment bank dramatically cut its losses.
The bank yesterday posted a net loss of $7.5 million for the first quarter, a remarkable improvement on the $607m loss for the final quarter of last year and an improvement on the $37.7m for the first quarter of last year.
This improved performance during the quarter reflects the restructuring efforts taken by management. The operating costs were reduced by 45 per cent this quarter.
"The March quarter result was very pleasing especially as there were no provisions taken this quarter," said chairman Esam Janahi.
"The board has taken a very prudent approach in declaring this result and is committed to continuing transparency in the way we do business.
"The result also shows that management has taken the necessary steps to reposition GFH for a return to profitability in the near term. We look forward towards a continuing trend of improvement in the second quarter," he said.
"We continue to work hard to improve our underlying performance," said group chief executive officer Ted Pretty.
"We have been focused on reducing our operating costs and meeting our debt commitments, and our efforts have been compensated by an encouraging $24.5m improvement in GFH operating results on the previous quarter. Besides, despite very challenging market times, GFH has seen its revenues grow to $18.5m and has started the marketing and placement of new products which are expected to make important contributions to revenue in the next quarters.
"Our objective is to ensure that we are well placed as the global markets improve. GFH had the courage to take the hard decisions last year and now we can see a path to recovery for the Islamic finance sector. This year will be a bridge year from the challenges of 2009 to an improving market in 2010/2011."
"GFH is a flagship institution in Bahrain and the Islamic financial sector and we are committed to working hard to set a better example as a model participant," he added.
"Islamic finance has excellent growth prospects and GFH is well placed to take advantage of this growth."