Profits at United Gulf Bank (UGB), the Bahrain-based offshore investment bank, rose by 42 per cent to $19.4 million in 1993. A 5 per cent dividend has been proposed.

It is the third year that the bank has posted profits after heavy losses of $34.6 million in 1990. It is also the first year that the bank has proposed a dividend since that time.

The improved profits allowed the bank to record an accumulated surplus of $7.5 million, compared to a deficit of $28 million in 1992. Shareholders’ equity rose by 6 per cent to $219.9 million.

Total assets grew by 2.5 per cent to $304.6 million. The bulk is in securities investments which rose by 9 per cent to $98.4 million and in investments in managed portfolios which rose by nearly 10 per cent to $94 million.

The bank’s investment in property increased by 2 per cent to $50.9 million. Loans and advances make up only a fraction of total assets and were virtually unchanged at $17.9 million.

UGB attributes its return to profit to gains from securities trading, earnings from which rose by more than 400 per cent to $6.1 million, and foreign currency trading which returned a $2.3 million profit after a $2.7 million loss in 1992.

Net operating revenue rose by 50 per cent to $24.4 million largely due to a 25 per cent increase in investment income and other income to $26 million and $28 million respectively.

UGB is 97 per cent owned by the Kuwait Investment Projects Company. The bank is currently working on its new business strategy and will hold a meeting to discuss this in mid-April, bank sources say.