Gulf Bank, which was rescued by the Kuwaiti central bank two years ago during the financial crisis, swung to fourth quarter and full year profit, it said on Wednesday.

Gulf Bank had net profit of KD8.66 million ($31 million) in the fourth quarter, according to Reuters calculations, reversing a net loss of KD21.05 million in the prior-year period.

The bank earned 2010 net profit of KD19.06 million against a net loss of KD28.07 million in 2009, according to a statement to the bourse on Wednesday.

Reuters calculated quarterly profit from previous financial statements. Gulf Bank made a profit of KD10.4 million in the nine months to September 30.

The global financial crisis hit the Kuwaiti banking sector hard as significant losses on investment portfolios became apparent and lending conditions tightened.

In 2008, Gulf Bank was rescued by the central bank after derivatives losses and the sovereign wealth fund, Kuwait Investment Authority, owns a 16-per cent stake. Its troubles prompted the government to guarantee all deposits in local banks to restore confidence.

Shares in Gulf Bank ended 1.8 per cent lower on Wednesday, bringing losses for the year so far to 3.5 per cent.-Reuters