GFH profits climb 30% as its strategy pays off

Dubai: Gulf Finance House on Saturday said it has recorded 30.73 per cent growth in profits to Dh1, 109.5 million ($302 million) for the first nine months of the year compared to $231 million recorded in the same period in 2007.

"These results continue the overall trend of strong earnings growth when compared to the same period in 2007 and demonstrate the tremendous durability of GFH's business model despite the collapse in global financial markets," the company said in a statement.

Third quarter profits of $82 million were driven largely by the continued success of the Energy City Libya (ECL) business cluster - GFH's latest econ-omic infrastructure project.

Further income was derived from GFH's share of the net income of Khaleeji Commercial Bank, Qinvest and Bahrain Financial Harbour Investment Company.

Capital projects

"GFH's strategy of producing a diverse, sustainable revenue stream is now paying off - a fact clearly demonstrated via a series of 2008 venture capital projects that include First Energy Bank and Cemena. Of course these initiatives build on GFH's already strong and growing series of economic infrastructure projects," said GFH chairman Esam Janahi.

"Certainly, western equity markets have endured serious volatility and the impact of sub-prime asset classes on major western financial institutions is well documented.

"This phenomenon is however, of little relevance to GFH. Our strict adherence to Sharia-compliant Islamic banking precludes both our involvement and any financial exposure. This reason, alongside strong regulation and better capitalisation mean that GCC banks will emerge from this crisis in better shape than many of their western competitors," he added.

Janahi said that GFH has an investor base that remains immensely supportive in the firm's ability to create value.

"Given the strength of our capital base and a full pipeline of forthcoming projects ready and waiting, we enter the fourth quarter confident in the knowledge that it'll be stronger than any that have gone before," he said.

The bank maintains strong liquidity holding $1 billion of equity and $1.4 billion in cash.