Crisis hit Gulf Finance House is eyeing growth opportunities again

Before the financial crisis took hold in 2008, Bahrain-based Islamic investment bank Gulf Finance House was expanding rapidly. At its peak, the firm employed more than 300 people. Now, it has a headcount of just 55.

As investment banking activity plummeted, along with the property prices in the region, Gulf Finance House was hit particularly hard. At one point, the bank’s auditors, KPMG, ordered the bank to start selling off assets and restructure debt in order to secure its survival.

Now, however, it’s talking about growth again. This is unlikely to benefit any investment bankers in the region, however, or result in much recruitment – it’s moving away from deal-making and instead focusing on kick-starting property projects and looking to gain a steady income from some of its subsidiaries and potentially make some acquisitions.

"We're planning to reshape Gulf Finance House as a group with diversified income," Hisham Alrayes, the bank's acting chief executive, told The National. "During this year we're trying to increase our stakes in some of our subsidiaries, and at the same time, to make, hopefully, one acquisition."

The deep redundancies at Gulf Finance House are indicative of a number of key regional investment banks falling from grace since the crisis as deal-making has dried up. Shuaa Capital, for instance, is now tentatively talking up growth again, having shed 60% of its employees. Around 130 staff remain there, down from 285 in Q1 2011.