Gulf Finance House announces restructuring of Sukuk (By IFN)

BAHRAIN: Gulf Finance House (GFH) has announced the restructuring of US$110 million-worth of Sukuk outstanding; extending its repayment of the debt.

The bank received approval from its Sukukholders for the restructuring, which will see the bank extending its repayment over the next six years. The Sukuk will now mature in June 2018, with GFH receiving a two-year grace period for the principal repayment amount in 2012 and 2013.

“With the approval to restructure GFH’s Sukuk, we are now in a better position to accelerate growth initiatives for the future. We are targeting to extend the maturities of our debt over a longer-term to retain our key assets. The restructuring of the GFH Sukuk is an extremely positive development for the bank and will enhance the bank’s balance sheet significantly,” said Hisham Alrayes, its acting CEO.

More than 92% of the bank’s Sukukholders voted on the restructuring during an extraordinary general meeting on the 15th May, with 100% of the voters agreeing to the new terms.
Liquidity Management Center and KPMG advised on the transaction.

GFH sold the US$200 million Sukuk in July 2007. The bank, which has been struggling since the 2008/2009 financial crisis, reported a 92% year-on-year plunge to US$1 million in its net profit in the first quarter of this year. It has embarked on a recovery plan which, apart from debt restructurings, also includes stringent cost cutting measures.

As at the 31st March this year, the bank’s cash and cash equivalents amounted to US$6.42 million against US$40.92 million a year earlier.

See: http://redmoney.newsweaver.co.uk/t9bukw7ol0ch38rwoni3wx?email=true&a=6&p=24260555&t=21279975