January 26th, 2009   Gulf Bank has successfully completed the doubling of its capital by a Rights Issue of its shares. Gulf Bank is pleased to announce that :

In line with the resolution adopted by shareholders at the EGM on 2 December 2008, the balance of unsold shares will be purchased by the Kuwait Investment Authority (KIA) at a price of 300 Fils per share, giving it approximately 403 million shares, representing 32% of the new rights issue and a final ownership stake in Gulf Bank of 16%. Gulf Bank is extremely pleased to have the KIA as a partner as it embarks on a new beginning.

This capital raising has resulted in the Bank having a pro-forma core Tier I  capital of 12.5%, on a proportionally consolidated basis, significantly enhancing the Bank's financial strength and flexibility in the face of continuing turbulence and uncertainty in global financial markets.

The new capital will allow Gulf Bank  to build on the existing franchise as a profitable bank and to continue as a competitive provider of world-class banking services to customers.

We will move the Bank toward world-class standards in customer satisfaction, product innovation, and competitive value.  Our plan consists of three major elements: First, we will identify and implement best practices throughout the organization " from the front-line teller serving a retail customer to sophisticated cash management for corporate customers. These best practices will include the way we do things throughout the Bank, the tools we use, and the "always customer-driven" priorities we set.

Second, we will invest in the Bank.  While part of this investment will be in better technologies and branches, a lot of this will be in our core asset, the staff of Gulf Bank " training, incentives, and advancement of our human capital. We will ensure that we have the best leadership in the region to drive the organization forward.

Finally, we will ensure that the Bank is secure. In other words, we need to manage risk effectively so that shareholders are well served.  This means a bank-wide upgrade of the risk management systems and processes so that credit risk, market risk, and operating risk are always controlled.

It is critical that current and prospective shareholders realize that these initiatives are already underway. We have engaged a number of world-class advisors to help us design and implement these changes " and we are well underway: reorganization of the Bank is currently progressing; we have commissioned searches for additional talent to be added to the Bank's organization; and we are launching a number of go-to-market programs that will introduce new products to our customers and increase our market share more than ever to realize this future.

Board Elections

In line with the Bank's articles of association, nominations for new Directors are currently being sought and after confirmation by the Central Bank of Kuwait,a new Board will be elected in March 2009 at the  Ordinary General Meeting.  The Board will then elect a Chairman and Vice-Chairman.