Bahrain-based Gulf International Bank (GIB)has reported a net profit of $100.5 million for 2001, 15 per cent below 2000 earnings of $118.1 million. The drop in net income resulted mainly from higher provisions and a one-off restructuring charge.
'The results contain many positive elements,' GIB chairman and undersecretary of state at the Bahraini Finance & National Economy Ministry Sheikh Ebrahim al-Khalifa said in a 28 January statement. 'Interest earnings have shown a strong advance and while trading revenues were down against the previous year they have nevertheless remained positive in a particularly difficult environment.'
The provision charge against credit losses was $52.1 million, against $36.2 million in 2000, and the restructuring charge was $8.4 million. During 2001 GIB was reorganised into four core divisions, each reporting to chief executive officer Khaled al-Fayez. The largest division is in charge of merchant banking, and is headed by Matthew Snyder. It covers a wide range of activities, including corporate, project and structured finance, as well as asset management (MEED 19:10:01).
The restructuring followed a change in the bank's ownership, entailing the sale by Kuwait-based Gulf Investment Companyof its stake in GIB to its own shareholders, the governments of the six GCC states. The six governments hold 72.5 per cent of the bank's equity. The remainder is held by JP Morgan Overseas Capital Corporation(22.2 per cent) and the Saudi Arabian Monetary Agency (central bank - 5.3 per cent).
GIB's assets rose marginally to $15,232 million at the end of 2001. Shareholders' equity stands at $1,193.7 million.
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