Bahrain's sovereign wealth fund (SWF) Mumtalakat plans to choose a rating agency before the end of the year, its chief executive said on Wednesday of the move that would pave the way for the fund to access capital markets.

This would make Mumtalakat the first regional sovereign wealth fund with a credit rating. It has said it would seek a rating before tapping the debt market.

"We are talking to the three agencies; to the major agencies", said chief executive Talal al-Zain, referring to rating firms Fitch, Moody's, and Standard & Poor's.

"Probably later this year," he said when asked when a choice would be made.

Mumtalakat is still working on improving the reporting structures of its portfolio companies, which include Bahrain's national carrier Gulf Air and a stake in Bahrain Telecommunications Company (Batelco), he said.

"We are working to improve our structure (and) making sure that the investee companies will be ready to give to us their (financial) results when we need them for the consolidated reporting."

Bahrain is a small oil producer and Mumtalakat does not have the financial clout of other sovereign wealth funds in the region, such as the Qatar Investment Authority (QIA) or the funds of the Abu Dhabi, the capital of the UAE.

A 30 per cent stake in the Formula One team McLaren is its only sizable international holding, but it is planning to boost the international share of its portfolio to 50 per cent, for which it will need financing.

Mumtalakat posted a $183 million loss in 2008 due to impairment charges from its investments in Gulf International Bank (GIB) and Gulf Investment Corp. – Reuters