Bahrain

Bahrain's central bank said on Tuesday it is taking steps to close down Iranian-owned Future Bank, which is based in the Gulf state, Reuters reported. On Monday, Ebtisam al-Arrayed, head of regulatory policy at the central bank, told Reuters that the regulator had yet to make a decision about Future Bank after placing it under its administration last year, along with Iran Insurance Co - the Bahrain branch of an Iranian insurer. At that time the regulator said the moves were to "protect the rights of depositors and policyholders".

An Iranian-owned bank based in Bahrain has appealed a decision by local authorities to place it in administration, in a case showing the vulnerability of Iran's business interests in the Gulf as political tensions rise, Reuters reported. In a letter to the Central Bank of Bahrain (CBB), the chairman of Future Bank, Abdolnaser Hemmati, said his company had fully complied with regulatory requirements and saw no reason to be treated as a risk to the banking system.

Bahrain's central bank said on Thursday it had placed two Iran-linked companies, Future Bank and Iran Insurance Co, into administration to protect the rights of depositors and policyholders, Reuters reported. In a brief statement, the central bank did not elaborate on why it took the action or give any information about the two companies. It said it wished "to reassure both the local and international financial community that this measure is an isolated incident and will not impact any other bank or insurance company in the kingdom.

Batelco will pursue its former Indian business partner for $212 million it says he owes the company, even though he was declared bankrupt last week, the Bahraini telecom operator said on Sunday, Reuters reported. Chinnakannan Sivasankaran, the chairman of Chennai-based Siva, filed for bankruptcy in the Seychelles after a British court in June ordered Siva and Sivasankaran to pay the money to Batelco's wholly owned subsidiary BMIC. This related to their failed Indian joint venture. The court also issued an indefinite worldwide freeze on the defendants' assets.

Arcapita, a private equity and investment company based in Bahrain, has emerged from bankruptcy protection in the U.S. this week, concluding a reorganization that analysts say may represent the first true post-financial-crisis debt restructuring by an Arab Gulf company, The Wall Street Journal Middle East Real Time blog reported. The bankruptcy plan approved by a U.S. court envisions Arcapita selling down its portfolio of assets over five years to repay creditors, and then effectively going out of business.

A U.S. judge Tuesday approved Arcapita Bank B.S.C.'s plan to gradually liquidate itself in a process that conforms with Islamic Shariah law, which generally prohibits borrowing money with interest, The Wall Street Journal reported. The Bahrain investment firm entered bankruptcy protection last year with a goal of restructuring itself but ended up with a plan to orderly liquidate its private-equity investments.

Goldman Sachs Group Inc., which is already providing Arcapita Bank $350 million in bankruptcy exit financing, is now seeking to give the Bahrain investment firm a $175 million bankruptcy loan that would pay off existing lender Fortress Investment Group LLC, Nasdaq.com reported on a Dow Jones Business News story. In a Monday filing with U.S. Bankruptcy Court in Manhattan, Arcapita said the Goldman loan would pay off the $105 million still owed to Fortress and later convert into the $350 million exit loan that Goldman is already providing.

Corporate collapses and debt restructurings have been common in the Persian Gulf since the financial crisis. But the U.S. bankruptcy filing by the Bahrain-based investment firm Arcapita has presented an unusual sight for the region – a debt-laden company which is planning to sell all its assets to repay creditors and wind up its operations, The Wall Street Journal Middle East Real Time blog reported.

Arcapita Bank BSC, an Islamic-compliant fund manager, won court permission to borrow $350 million from Goldman Sachs International (GS) to finance its exit from bankruptcy, Bloomberg reported. U.S. Bankruptcy Judge Sean Lane in Manhattan approved the financing today after Goldman Sachs and Fortress Credit Corp. revised their loan offers in an auction held in a conference room outside of Lane’s court. Goldman Sachs made the best proposal, Michael Rosenthal, a lawyer for Arcapita, told Lane.

A U.S. court is expected on June 11 to confirm the restructuring plan of Bahrain-based Arcapita , the company said, making it the first Gulf company to file for bankruptcy protection under Chapter 11 rules, Thomson Reuters News & Insight reported. Like most investment companies in the region, Arcapita was hit by the financial crisis as it struggled to exit its investments and its fee income from raising fresh funds in the Gulf Arab region collapsed.