I am pleased to report that First Bahrain posted a positive financial performance for fiscal 2008. At the end of the year, total assets stood at KD 42.6 million compared to KD 41.2 million at the end of 2007, with total equity increasing to KD 42.1 million (2007: KD 40.8 million). In view of the continued lack of global clarity and regional market uncertainty expected during 2009, the Board has adopted a very conservative approach to provisioning and impairments totalling KD 2.8 million, As a result, First Bahrain is reporting Against this scenario, First Bahrain is reporting a net profit of KD 2.6 million for 2008 compared to KD 4.8 million for the previous year. This provisioning  has resulted in a very clean and encumbered balance sheet, with healthy levels of liquidity of KD 3.2 million comprising cash and bank balances. As a result, First Bahrain is reporting a net profit of KD 2.6 million for 2008 (2007: KD 4.9 Million)

The financial performance during 2008 reinforces the Company’s consistently prudent approach to business. It also underlines our differentiated Sharia compliant investment philosophy, which focuses on developing domestic demand driven projects that will bring enduring value and sustainable prosperity to the local community, while also contributing to the growth of the economy.

Two developments during the year firmly illustrate this approach. The first was the Board’s considered decision, in light of prevailing market decisions, not to proceed with our planned mixed use development project in Bahrain’s Seef district, in order to maintain the sound financial position of First Bahrain. The land has been converted in the Company’s accounts to Investment Property, and we are currently reviewing several options for the most effective utilization of this land, which has important strategic and monetary value.

Secondly, the Company’s inaugural project, our warehousing and logistics facility at Bahrain Investment Wharf (BIW) continued to make excellent progress during the year. Additional land at BIW was acquired to meet increasing demand for affordable warehousing space by small to medium enterprises, which are an important engine of growth for the economy.

Construction for phase one, the pricing for which has been substantially reduced due to falling commodity prices, has begun and the Company is preparing for the launch of the operating company for the project in the fourth quarter of 2009. Completion of phase one is planned for the end of next year

On behalf of the Board of Directors, I would like to extend my best wishes to H.H. Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, the Amir of the State of Kuwait, and to H.H. Sheikh Nawaf Al-Ahmad Al-Jaber Al Sabah, the Crown Prince of the State of Kuwait, for their tireless dedication to the economic future and prosperity of the State of Kuwait. My thanks are also due to the State’s government ministries, supervisory bodies, and regulatory authorities, for their continued constructive cooperation and guidance.

I also express my sincere appreciation to our shareholders for their confidence and support; to our clients for their loyalty and trust; to our business partners for their advice and encouragement; and to our management and staff for their professionalism and dedication.

May Almighty God grant us all sustained success and prosperity.

Salah Ahmed Al Wuhaib
Chairman