IslamicFinance.de

Press Release

Gulf Finance House Long-Term Rating Lowered To 'CC'; Outlook Negative; Ratings
Withdrawn At GFH's Request

*Gulf Finance House's liquidity is under immediate and severe stress, and the
institution has not been able to strengthen it, in our view. *We note that GFH has a
large debt repayment coming due in the next few weeks. *We are lowering our
long-term rating on GFH to 'CC' from 'CCC-' and are affirming the 'C' short-term
rating. *We are withdrawing all the ratings on GFH at its request. *The outlook was
negative at the time of withdrawal.

PARIS (Standard & Poor's) July 5, 2010--Standard & Poor's Ratings Services said
today that it has lowered its long-term counterparty credit rating on Bahrain-based
Gulf Finance House to 'CC' from 'CCC-'. At the same time, we affirmed GFH's 'C'
short-term counterparty credit rating. Subsequently, we withdrew all the ratings on
GFH at its request. The outlook was negative at the time of withdrawal.

"The downgrade reflects our expectation that GFH is likely to restructure its debt
soon because of its weakening liquidity and revenue generation. In our view,
difficult operating conditions are hampering management's efforts to improve GFH's
business and financial profile," said Standard & Poor's credit analyst Goeksenin
Karagoez.

We are of the view that GFH's liquid assets will likely be insufficient to allow it
to repay $100 million due on Aug. 10, 2010. This amount is the remaining portion of
a syndicated murabaha facility whose original amount due was $300 million. GFH
reportedly paid only $200 million when the facility became due in February 2010,
when the lending group agreed to extend the maturity of the remaining $100 million
for six months. We understand that GFH has started discussions with the lending
group to extend the maturity of the $100 million a second time. In our opinion, any
improvement in GFH's liquidity is unlikely as long as the equity and real estate
markets continue to reduce the fair value and liquidity of GFH's key investments.

With total assets of $1.3 billion on March 31, 2010, GFH is an Islamic wholesale
investment institution based in the Kingdom of Bahrain (A/Stable/A-1). GFH's main
focus and area of expertise is economic infrastructure projects. GFH's geographic
and sector concentrations are high because it has focused on real estate,
infrastructure, and industrial projects across its home region.

RELATED CRITERIA AND RESEARCH
*Rating Implications Of Exchange Offers And Similar Restructurings, Update, May 12,
2009 *General Criteria: How Standard & Poor's Uses Its 'CCC' Rating, Dec. 12, 2008