Gulf International Bank, the lender owned by the six nations that form the Gulf Cooperation Council, said it posted a second-quarter $65.4m loss after it took provisions against rising loan defaults.
The Bahrain-based merchant bank attributed the loss to a net provision charge of $101.3m it took during the second quarter.
“In view of the prevailing economic conditions, the bank increased its non-specific loan provisions so as to maintain provisions at a level consistent with the historical highest ever corporate default rates,” according to a statement from the bank.
Senior executives at the bank were not immediately available to comment, a GIB spokesman said.
GIB is owned by the governments of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, the UAE and the Saudi Arabian Monetary Agency. The bank has branches in London, New York and two in Saudi Arabia.
The bank is the latest bank in the region to join the swelling ranks of lenders that have seen their profits eroded as they take provisions against a rise in loan defaults. (Reuters)
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