MANAMA: Though a difficult and challenging environment lies ahead, Bahrain-based Liquidity Management Centre (LMC) believes that the market has witnessed a large correction.

"This is especially the case for the GCC capital markets where most of the adverse market conditions have been priced in," said LMC chief executive Ahmed Abbas.

"This year may continue to carry opportunities to alert investors and positive growth may be obtained if volatility levels are taken into account.

"Given our strong shareholder support, track record and experienced team, we believe that we are well prepared for the remainder of this challenging year," he added. LMC chairman Emad Al Monayea yesterday announced a first-half net profit of $1.222 million after the impairment provision of $220,000 compared with a net profit of $932,000 for the same period in 2011, resulting in 31 per cent increase. Second-quarter net profit stood at $711,000 compared with $571,000 for the same period in 2011.

The total operating income was $3.925m compared with $4.309m for the same period in 2011. This half's net profit represents 4.8pc per annum return on capital while the average interbank rate remains below 0.5pc. "These results undoubtedly demonstrate the bank's ability to perform while adopting a conservative approach in the current market environment by taking additional provisions," said Mr Abbas.

"This achievement was due to various advisory services for prominent transactions for Islamic banks in the region and a well managed portfolio of sukuk and equities and a diversified investment approach."

The prudent operating results were further enhanced by controlling operating expenses. In terms of the bank's balance sheet, total assets witnessed a decrease of 7.6pc from $184.7m at the year-end to $170.6m in the first-half of 2012. Shareholders' equity increased by 2.36pc during the same period.