Bahrain's $9 billion sovereign wealth fund Mumtalakat appointed Mahmood Hashem Al-Kooheji as its new chief executive on Wednesday.

He replaces Talal Al Zain who resigned last month to set up his own investment firm.

Kooheji, who was deputy chief executive of the fund since 2006, was also most recently the chief executive of Bahrain-based labour fund Tamkeen, Mumtalakat said in a statement.

Sources had earlier told Reuters that Salman Al-Khalifa, a former top regional banker at Deutsche Bank in the Middle East and royal family member, was the prime contender to run the fund.

Set up in 2006 to help diversify Bahrain's economy away from hydrocarbons, Mumtalakat has stakes in over 35 commercial entities, including Bahrain Telecommunications Co, Gulf Air, and Aluminium Bahrain (Alba), one of the largest aluminium smelters in the world. Kooheji is also the chairman of Alba.

In December, Mumtalakat said it narrowed its 2010 operating  loss to 48.9 million dinars ($129.71 million) from a loss of 123.4 million dinares citing strong growth in gross margins and an improved operating performance across the portfolio. Revenues rose 15 percent in 2010, thanks to commodity price-fuelled gains at Alba. - Reuters