Bahrain National Holding Company (BNH) made a net profit of BD2.021 million ($5.361 million) last year.

Insurance underwriting performed extremely well for the year with profit up 56.3 per cent to BD3.135 million compared to BD2.006 million for 2007.

Motor underwriting profit increased by 13pc, general business increased by 257pc and medical and life increased by 68pc.

However, the substantial drop in world financial markets caused investment income to decline to BD433,000 in comparison to BD3.103m for 2007.

"The group has decided to make prudent provisions for impairment in the value of securities which has contributed to the lower result for 2008," said BNH chief executive Mahmood Al Soufi.

"We hope that this will prove to be a one-off charge and that world markets will improve over the next six to 12 months."

The board is recommending a 15pc cash dividend from the company's paid-up capital at 15 fils per share.

"To operate a business in such difficult market conditions is certainly a challenge. But due to our prudent and selective underwriting and direct investment strategies, such hardships were partially mitigated," added Mr Al Soufi.

"Our associate companies - National Finance House and Arabian Shield - achieved higher profit for the year, exceeding all expectation set at their inauguration. "Therefore, we will continue to selectively seek market opportunities and bring them to fruition." -TradeArabia News Service