DUBAI -- Bahrain-based Gulf Finance House (GFH ) confirmed that its seeking to refinance debt worth $300 million due on Fepuary 10. This confirmation came following the suspension of GFH shares on the Bahraini Stock Exchange on Tuesday after a media report on debt re-financing of the Islamic investment house.

"It [GFH] is having discussions with West LB (the syndicate manager) in London in relation to the terms of its syndicated facility," a statement by the investment revealed.

GFH further confirmed that it would immediately announce the results of such discussions in line with the disclosure requirements of the Central Bank of Bahrain and Bahrain
 Stock Exchange.

try{document.write(_banner_zone('zone9337')); }catch(e){} "The total amount of the facilities, the terms of which are under discussion, amount to $300 million due on Fepuary 10, 2010," the statement said. Like other Bahraini off-shore investment houses, GFH has been badly hit by the end to the regional 
real estate boom.

"We are comfortable about that," Chief Executive Ted pretty told Reuters in a phone interview at the weekend when asked about the bank's $300 million murabaha, or sharia-compliant financing instrument, due in Fepuary, but did not say if the bank would repay or refinance the loan.

pretty - acting CEO at GFH following the surprise December resignation of former chief Ahmed Fahour - said a $50 million tranche of a separate sukuk, or Islamic bond, expiring in July 2012 was "in negotiation".

The sukuk was last quoted as trading at 71 percent of par value, with a yield to maturity of 15 per cent, according to Reuters data.

Sources familiar with GFH said the bank had over the past days been approaching private investors to raise loans, pledging real estate and other assets as collateral.

GFH posted profit until 2008 mainly by earning fees on money raised from investors for large real estate projects, a market which has since collapsed.

It has posted losses over the last four quarters and raised $300 million in a rights issue in October to shore up its balance sheet.

By Abdul Basit

© Khaleej Times 2010