Bahrain's sovereign wealth fund Mumtalakat Holding Company has delayed by a year plans to increase foreign investments to almost half its total assets and would instead focus on assets at home, said a report.

Mumtalakat announced in April plans to diversify its portfolio by increasing foreign investment to 50 per cent from little more than two per cent, the Meed magazine reported.

'The implementation of that strategy has been slowed down,' Meed quoted Talal Al-Zain, the fund's chief executive officer, as saying.

Having 50 per cent of its investments in foreign assets 'remains a long-term aim', it added without making clear whether the statement was made by Zain.

Zain told Reuters on Tuesday that Mumtalakat was not expected to divest its holdings in local firms this year because of low market valuations.

The fund with assets of about $10 billion under management was not highly leveraged, and has a lot of liquidity available for new investments, Zain told Meed.

'We have to decide if we want to start investing now or wait. We are happy to not get all of the potential upside while we wait for the global economy to stabilise, although for the right opportunity we will go into the market,' Zain said.

Until then, Mumtalakat will 'look inwards at the companies we own and their strength and financial position,' he said.

Mumtalakat's focus 'now is to take advantage of the global financial crisis to strengthen its Bahraini assets,' the report added.

'If I have a company that is creating value for me then I do not see why I should not share that with the people of Bahrain, either through private placements or initial public offerings,' Zain said.

'We had been looking at a couple of these, but now it is a buyer's market and not a seller's market.'

Mumtalakat holds stakes in Gulf Air, Aluminium Bahrain and Bahrain Telecommunications Company.-Reuters