Kuwait's Gulf Bank had $403m provisions in '10

Kuwait's Gulf Bank booked provisions worth KD113m ($403.3m) in 2010 to meet losses arising from its credit portfolio, the bank's chief executive said in published remarks on Sunday.

The bank had set aside KD111m in 2009 to meet investment and loan losses.

"The percentage of irregular debts in the bank's portfolio went down to 14 percent compared with 24 percent in 2009, and I expect this percentage to continue improving during the year," Chief Executive Michel Accad said to the local newspaper Al Rai.

Gulf Bank, which was rescued by the Kuwaiti central bank in 2008, after about KD260m ($930.2m) of derivatives losses, is 97 percent to 100 percent provisioned against the irregular debts, Accad said.

"We were able to handle all the large irregular debts in the credit portfolio, but this doesn't mean that the overall struggles are over," Accad said.

The chief executive said that bank's position "is good and is moving towards improvement", adding that it was able to mend all their problems and spend about KD500m in booking provisions.

Gulf Bank, in which sovereign wealth fund Kuwait Investment Authority (KIA) owns a 16 percent stake, said it doesn't need to increase capital based on the current financial strategy the bank is following. Accad also said that the bank is not exposed to any "great names facing trouble."

Earlier in February, the bank posted a net profit of KD8.66m in the fourth quarter, compared with a net loss of KD21.05m in 2009.