MANAMA: United Gulf Bank (UGB), the asset management and investment banking platform of the KIPCO Group, yesterday announced a net profit of $16.5 million for the first half of this year.

This was a 24 per cent increase over $13.3m registered in same period last year.

UGB recorded a total income of $60.3m for the first half of 2012 compared with $63.5m for the six months ended June 30, 2011.

Fees and commission income contributed $11.5m for the first half of 2012 compared with $9.5m in the same period last year.

Contributions from associates increased to $21.6m in the first half of this year, compared with $11.5m in the same period last year.

This was due to improved results of commercial banking and real estate associates.

Investment income reduced to $24.1m in the first six months of 2012, compared with $38.5m in first half of 2011 due to deleveraging and exits of non-trading investments.

UGB's net profit for the second quarter of 2012 decreased by 13.4pc to $7.3m compared with $8.5m for the same period last year.

UGB's total assets stood at $1.44 billion as of June 30, 2012, a decrease from $1.77bn as of December 31, 2011.

The decrease in assets is part of UGB's strategy to reduce its non-core assets including some real estate holdings.

During the second quarter of this year, UGB repaid a total of $268m of loans from internally generated funds.

So far this year, UGB has reduced its current debt with loan repayments totalling $296m.

UGB's assets under management on June 30, 2012, were $7.6bn, compared with $7.1bn on December 30, 2011.

"These results demonstrate the strength of UGB's underlying core assets which are performing to our expectations," chairman Masaud Hayat said.

"During the quarter, we also paid off another significant proportion of our debt from our own funds.

"Looking forward, we will continue to maintain a high level of capital and a strong liquidity position," he said. "In line with our business strategy, we will also continue to deleverage our balance sheet, while investing in our core activities and markets," he added.