The main shareholders of Gulf Riyad Bank are expected to meet in September to discuss the future of the Manama-based offshore bank. The bank has faced the prospect of restructuring or possible closure since the end of 1993, and took on no new business in 1994.

Gulf Riyad Bank says it may go into voluntary liquidation. However, Saudi Arabia’s Riyad Bank, which owns a 60 per cent stake in Gulf Riyad, says the board is considering a number of options as part of an ongoing review of all international and domestic operations to ensure maximum return for Riyad Bank shareholders.

Credit Lyonnais, which owns the remaining 40 per cent in Gulf Riyad, was understood to be considering taking over the institution at the start of 1994. This would give the French group a direct presence in the region. However, Credit Lyonnais officials were unavailable for comment.

Gulf Riyad reported profits of $5.3 million in 1994, down almost 50 per cent on a year earlier. The balance sheet shrank by 12 per cent last year to $197 million. In 1993 assets fell by 17 per cent. The bank says it is accepting no new customer or interbank deposits, and is limiting its activity to managing existing assets.