Trading of GFH resumes after months-long hiatus
Trading in shares of Gulf Finance House (GFH), a Bahraini Islamic investment bank, has resumed after a suspension that lasted almost eight months.
The hiatus began in October, when GFH said it was asking shareholders to contribute up to US$500 million (Dh1.83 billion) to a recapitalisation of the company after it ran into financial trouble during the global economic crisis.
The bank also said it would engineer a share consolidation, reducing the number of outstanding shares to increase the stock price.
GFH is traded on the Bahrain Stock Exchange, the Kuwait Stock Exchange and the Dubai Financial Market.
Its shares also trade on the London Stock Exchange as global depositary receipts.
The resumption of trading comes just days after GFH announced a profit of $11.9m in the first three months of the year, its first quarter in the black after nine quarters of losses.
"We highly appreciate our shareholders and investors' confidence and support during the difficult times, which [are] now behind us, and predict to reward this confidence even further in the coming quarters," Esam Janahi, the bank's executive chairman, said on Tuesday.
GFH was one of the Gulf companies hardest hit by the financial crisis.
It booked large profits in previous years by collecting premiums on investments in multibillion-dollar property projects and private-equity deals, but those sources of income all but disappeared when investors retreated in 2008 and 2009.
The turmoil in regional markets forced GFH to reschedule debt and rethink its business model. It is transitioning to a focus on establishing and nourishing Islamic financial institutions in the region.
As it makes the shift, the company is selling assets accumulated during the boom and continuing to honour commitments to investors in its property projects, which include huge Energy City developments in India, Qatar and Libya.
The recapitalisation floated in October has attracted about $120m of investment, GFH said this week.
After the resumption of trading yesterday, GFH shares fell by 9.6 per cent in Dubai to Dh1.70 on thin volumes.
Updated: June 3, 2011 04:00 AM