US subprime crisis hits Gulf bank hard

Gulf International Bank suffers net loss of $757.3 million in 2007 due to its exposure to US subprime sector.
MANAMA – Bahrain-based Gulf International Bank said on Thursday it suffered a net loss of 757.3 million dollars in 2007 due mainly to its exposure to the crisis-ridden US home-loan subprime market. The merchant bank said in a statement the loss resulted from “revaluation losses and provisions in relation to exposures impacted by the global credit crisis witnessed during the second half of 2007.”

“The provisions primarily related to structured investment vehicles, and collateralised debt obligations incorporating exposures to the US subprime sector,” it added, highlighting the impact of the collapse of the US market for high-risk mortgages.

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