Gulf Finance House B.S.C. (GFH), one of the leading Islamic investment banks, today announced an excellent set of financial results, with net profit rising by 115% to US$62.4 million for the first half of 2005.
Announcing the results, Dr. Fuad Al-Omar, Chairman, GFH, said: “These very strong first half results confirm the soundness of the bank’s business model and the dedication and hard work of the bank’s team. We will continue to maximize total shareholder returns.”
Dr. Al-Omar further commented: “The bank has had a very busy second quarter which included laying the foundation stone for Jordan Gate, the first phase of our US$1 billion Royal Metropolis project, by His Majesty King Abdullah II of Jordan. The placement of the first phase $300 million was successfully accomplished. In addition, we finalised the US$ 134 million Sukuk issue for Bahrain Financial Harbour (BFH) which now ensures the success of this vital project for Bahrain.”
“Market conditions are very buoyant and we have a number of new infrastructure projects planned both in the GCC and in the wider MENA region. Our clients will also see some new and innovative alternative investment opportunities that will help them to diversify their investment portfolios in a Sharia’h compliant manner,” he said.
He continued, “Underpinning these results is the fact that most of the bank’s first half earnings have come from realized gain on sale of the bank’s projects and investments. The pipeline of income for the second half of this year has already been planned and we expect that 2005 will be another very successful year for Gulf Finance House. We will continue to focus on major regional infrastructure projects but we will also expand our treasury and asset management capabilities in order to ensure that we deliver sustained growth for the bank’s shareholders and investors.”
Commenting on the results, Mr. Esam Janahi, Chief Executive Officer and Board member, said: “Once again these results emphasise the strength, skill and experience of our team and their ability to create value for the bank’s clients. At GFH we look for exciting opportunities in the GCC and outside the region that will make an impact on the local economy. Our projects are selected carefully to reward our clients. Our formula for success also includes working closely with strategic partners in landmark projects.”
“Obviously, achieving such growth in our business comes with challenges on many fronts. To meet these challenges we continually strive to organise and re-engineer ourselves and we are doing this successfully.”
“This period also includes the results of GFH Commercial Bank (GFHCB) which I am pleased to say reported a profit of US$4 million. The Commercial Bank has been very active and has successfully established its franchise,” Mr. Janahi said.
GFHCB is a wholly-owned, real estate-focused on-shore subsidiary of GFH established towards the end of 2004 and its mandate includes raising financing for infrastructure development projects, including those conceived by GFH.
Mr. Janahi said the first half of the year was a very eventful period for GFH with a slew of developments accelerating the pace at which the bank’s projects were being pursued.
During the first six months, GFH successfully structured the exit of the first batch of investors in the US$1.3 billion Bahrain Financial Harbour (BFH) with a return of 50 per cent in two years. The development of the Areen spa and resort also picked up momentum during the period with Al Areen Holding Company partnering Asia’s leading luxury spa and resort operator, Banyan Tree Hotels and Resorts.
The master plan of the US$3.8 billion Legends has also been formally submitted to the Dubailand authorities on June 16 2005 and a holding company for the project has been set up in Dubai and is currently operational. The process to list the subsidiary company on the Dubai Financial Market (DFM) has started and the aim is to list the company during the third quarter of 2005. Work on the sales Center & Headquarters Building is also on track and an official opening is planned in September 2005.
“The second half of the year is equally exciting with the bank’s various projects on fast-track implementation mode and we are confident that GFH will close the year with another round of record profits,” Mr. Janahi added.
Gulf Finance House B.S.C
Established six years ago, Gulf Finance House B.S.C (GFH) has rapidly earned a reputation as a leading-edge player in Islamic banking. GFH has a paid-up capital of close to US$150 million and authorized capital of US$300 million. It is committed to the Islamic Sharia philosophy of wealth management and this directs its innovation and shapes the structure of its investment products. GFH is dedicated to providing clients with carefully selected investment opportunities that balance risk with reward. It leads the drive to establish an Islamic investment banking industry that dovetails with regional development. Consequently, GFH has since inception striven to offer investment opportunities in the countries where it operates so as to further their economic and social development. It aims to capitalize on the increasing willingness of Islamic investors to back local and regional business projects and opportunities and to take advantage of the wave of reforms initiated by GCC governments to diversify and liberalize their economies. This is balanced by enabling clients to diversify risk by offering them investment opportunities outside the region. This philosophy is reflected in GFH’s investment portfolio that includes major projects such as US$1.3 billion Bahrain Financial Harbour, US$750 million Al Areen development, US$3.8 billion Legends in Dubailand and a US$1 billion Royal Metropolis in the Kingdom of Jordan. GFH’s investments also include Lebanon’s Arab Finance House, Solidarity -Takaful life assurance, annuity savings, and short-term insurance; Bahrain’s Royal University for Women and menaJet – budget airline for the region.
