Shuaa Capital swung to a quarterly loss as slumping global markets hit volumes and forced the investment bank into provisions and asset revaluations.

Like many institutions in the region, Shuaa, one of the Arab world's largest investment banks and once a symbol of the sector's potential in the Middle East, has been hit by slumping trading volumes and lack of capital market activity locally and the feedthrough from global economic volatility.

"It was necessary and prudent to take valuation adjustments and provisions in the third quarter 2011 rather than be subject to risk exposures in 2012," chairman Sheikh Maktoum bin Hasher Al Maktoum said on Thursday.

Shuaa reported a net third-quarter loss of 156 million dirhams ($43 million) on Thursday. It made a 0.2 million dirhams profit in the 2010 period.

A revaluation of non-core assets worth 83.5 million dirhams, provisions, and a one-time charge of 41.2 million, hit the numbers, while reduced business volumes saw revenues drop 83 percent to 14.2 million dirhams.

Overall investment banking fees in the region fell 35 percent to $317 million in the first nine, Thomson Reuters data showed.

Shuaa named former Credit Suisse banker Michael Philipp as chief executive last month, replacing Sameer Al Ansari. Philipp is shifting the bank's focus to high net worth and institutional clients, he said in an interview.

In September, Shuaa, which helped float ports operator DP World, said it was in talks with a number of target companies after sources told Reuters the company was eyeing brokerage buys in Egypt. - Reuters