Continuing its historical trend of strong growth, Gulf Finance House (GFH) today announced excellent third quarter results for the period ending 30 September 2006, with cumulative net profit for the first nine months rising by 90 per cent to US$ 176 million compared to US$ 92 million in 2005. The third quarter profit for the year 2006 rose by 98% to US$ 59 million (September 2005 USD 30 million).
Announcing the bank’s results, Dr. Fuad Al Omar, Chairman, GFH, said: “This year’s third quarter results reconfirm the success of the bank’s business strategy and our commitment to generate superior total returns for its shareholders. The bank is on track with its expansion plans and has extended its activities into the markets of India, Saudi Arabia, Morocco and Egypt.”
He said the bank recorded a healthy rise in assets during the first nine months of this year. Total assets reached US$ 1,297 million, up by 55 per cent compared to US$ 840 million in the corresponding period in 2005.
“The strong results during the third quarter, usually a comparatively quiet period due to the holiday season, shows the strength of our business model which is focused on generating returns throughout the year. The strong results are very much a reflection of the commitment, dedication and hard work of the management of GFH and their skill in originating unique or attractive investment opportunities,” Dr. Al-Omar said.
He also added that the bank had a particularly busy third quarter with its involvement in a series of new projects. One of the main highlights during the third quarter was the launch of Prince Abdul Aziz Bin Mousaed Economic City in the Kingdom of Saudi Arabia. GFH is partnering with the Saudi Arabia General Investment Authority (SAGIA) and Rakisa Holding Company to develop the second economic city in the city of Hail, a project involving investments totalling US$ 2.9 billion.
“Significantly, GFH also became the first Islamic Investment bank to be awarded an investment credit grade rating of BBB- by Standard & Poor’s (S&P),” Dr. Al-Omar said.
Commenting on the results, Mr. Esam Janahi, Chief Executive Officer and Board Member of GFH said: “We at GFH are focused on creating value for our clients and in this quest we are determined to expand our geographical reach both across the MENA region and into key markets abroad. We have just announced our first venture in India, Energy City India, which is a major step forward in our emerging engagement with mature markets in Asia.”
He said GFH, along with Gulf Energy, intended to expand the Energy City concept further with the aim of creating a Pan-Asian infrastructure framework for the energy industry.
“Expanding across the larger MENA region and in line with our commitment to shareholders to reach out to new markets, GFH has also forayed into Morocco and Egypt in the third quarter. These projects in Egypt and Morocco also reflect our desire to contribute to the growth of the national economies of these countries that we are involved in.
In the Kingdom of Morocco, GFH has signed agreements with the Government in the presence of His Majesty King Mohammed VI to develop the US$ 1.4 billion Gateway to Morocco project. In the third quarter, GFH also signed an agreement with the transport of the Arab Republic of Egypt as part of a consortium to set up a US$ 1 billion holding company, which will undertake feasibility studies and identify opportunities to invest in the country’s transportation infrastructure. The holding company plans to raise equity and Islamic finance to fund an automated US$ 30 billion infrastructure project in Egypt.
The third quarter results are inclusive of the Khaleeji Commercial Bank, a wholly-owned commercial banking subsidiary of GFH. In the third quarter, the commercial bank posted a net profit of US$ 19 million compared to US$ 7 million in 2005.
“The bank has established a healthy inflow of income from its various projects and we are confident that the 2006 fiscal will close with another record performance. We are rapidly building up our international private equity and asset management teams and we will be making some major announcements regarding this form of business in the near future. We will also announce another major exit in the very near future,” Mr. Janahi added.
