(Sukuk.net - The Peninsula) Unrealised losses on investments and more focus on on fee generated income caused Global Investment to post its first ever loss, said its chairperson and managing director.

Maha Al Ghunaim said: "2008 was a year of unprecedented global market turbulence. Global has not been immune to this and we unfortunately reported our first ever loss in 2008. This has been caused, in a large part, by unrealised losses on our investments and as a result we are renewing our focus on fee generated income, which has always been profitable and in which we demonstrated continued growth in 2008."

"We are aware of our need to honour our obligations to all our stakeholders going forward and we have taken immediate steps to place Global in the best possible position to deliver value in these turbulent markets. I am pleased that we are making good progress on a number of these fronts," said the chief of Kuwait's major financial powerhouse.

"The bank has made 'positive and significant progress' in its restructuring plans. I am encouraged by the swift progress that has been made since December and by the positive response of the banks to our outline proposals," she said .

A high-level steering committee is in talks to restructure the $2.5bn debt. Germany's West LB, which arranged two syndicated loans, heads the committee chosen by about 50 creditors of Global. A Kuwaiti bank representing local banks, and Islamic bank are also on the committee. HSBC is the financial advisor of Global on the committee.

"We are in an open dialogue with our clients. We have sent them several messages assuring them about their investments as not being part of our financial statement. We have transferred some investments for clients, which were in our name to the names of the respective clients," a senior official said.

Kuwait Government this week okayed a $5.2bn stimulus plan to bail out Kuwait banks and she said that it would help Global too. "It will help us. If we don't benefit from it directly at least we will through the positive sentiments that it creates in the market, the enhancement of the capital market and accordingly the value of assets, and will give more credibility to creditors and mainly international banks that the government supports the economy," she said

Global's CEO Bader Al Sumait said that several different figures have been printed in media of the extent of the default. One says $3bn. Do you think there is mileage in fragmenting the figure in a story in a financial paper so that it looks much less and many parts of the 'whole' can be substantially justified and explained. I don't believe this is important today. The default was the main issue and not the amount.

"We also perceive a scenario in which the debtors have been satisfied by your acts of good faith so that the initial figure is further marginalised. Let's examine that route." he added.
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