Kuwait's Gulf Bank sees Q2 net profits soar

Kuwait's Gulf Bank second quarter net profit soared as the lender booked fewer provisions and saw improvement in its core business, its chief executive has said.

"We are still taking very large provisions but not as large as they were last year ... and the core operating business has improved," Michel Accad told Reuters.

Net profit in the three months to June 30 was KD8.5 million ($31.1 million), compared to KD1.4 million in the same period last year, the lender said in a statement on the Kuwaiti bourse website.

Net income in the first half of the year was KD18.3 million, up from KD1.98 million in the year earlier period the bank said.

Gulf Bank booked about KD37 million of provisions in the first half of this year, compared to KD80 million last year, Accad said.

"These provisions are mostly general and precautionary, because we are not very optimistic about the situation in general," he added without elaborating.

The bank which was rescued by the Kuwait's central bank in 2008, has been steadily recovering from its crisis, when it faced big losses related to derivatives. Its chairman said earlier this year that it had covered all residual losses stemming from 2008.

Gulf Bank's shareholder equity came in at 428. 5 million dinars in the first half of 2011, up from 391.2 million dinars in the year-earlier period.

The lender's shares were down 2 percent on the Kuwaiti bourse on Thursday. The results were released after the market closed.