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Thursday, 24 September 2009

Fitch downgrades Dewa and Dubai Holding unit, places Etisalat on watch negative

Fitch ratings has today lowered Dubai Holding Commercial Operations Group (DHCOG), a unit of Dubai Holding, Dubai Electricity and Water Authority (DEWA) and placed the ratings of the country’s largest telecoms firm Etisalat on watch with a negative outlook.

DHCOG and DEWA were downgraded to A- from A+.

Of the three companies, which have ties to Dubai and the UAE government, “the actions reflect Fitch's view that the credit profiles of the sovereign entities have weakened and lower certainty as to how any government support may be provided," Fitch said.

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Taib Bank Rating Downgraded at Fitch on Weaker Dubai Support

Taib Bank BSC, a Bahrain-based investment bank controlled by Dubai Financial LLC, had its long- term issuer default rating downgraded to ‘BBB-’ from ’BBB’ with negative outlook at Fitch Ratings.

The rating was cut because of the “view that the creditworthiness of the emirate of Dubai has weakened, to which the bank’s ultimate main shareholder Dubai Holding is inextricably linked,” Fitch said today. “The change in outlook reflects the concern that it could weaken further and hence DH will be less able to support TAIB Bank.”

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Seven U.A.E. Banks Downgraded by Fitch on Less Aid (Update1)

Fitch Ratings downgraded Commercial Bank of Dubai, Emirates Bank International PJSC, Mashreqbank PSC and four other lenders in the United Arab Emirates, citing the “weakened” ability of local governments to support them.

Bank of Sharjah, Dubai Bank, National Bank of Ras Al- Khaimah and Tamweel PJSC were the other institutions that had their long-term issuer default ratings cut, Fitch said today in an e-mailed statement.

This action reflects “Fitch’s view that the ability of the sovereign United Arab Emirates federal authorities and the Emirate of Dubai to provide support has lessened,” Fitch said. “The lack of clarity on the process for non-budgetary financial transfers between the U.A.E. federal government, central bank and individual emirates is a source of weakness.”

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Volkswagen, Qatar disagree over board seats

Volkswagen AG and Qatar are in a dispute over the emirate's representation on the carmaker's board, reported Bloomberg, citing a Manager Magazin article.

Volkswagen Supervisory Board Chairman Ferdinand Piech is only willing to give Qatar one seat once the emirate completes the purchase of a 20% stake as part of the carmaker’s merger with Porsche SE, the Hamburg-based magazine said.

Piech will “in no way allow” Qatar to appoint a second member, Manager Magazin said, citing an unidentified Volkswagen executive.

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Abu Dhabi’s ADCB Drops the Most in 3 Months; Dubai Shares Slide

Abu Dhabi Commercial Bank, the U.A.E.’s third-biggest bank by assets, fell the most in three months as loans to two troubled Saudi business groups prompted an analyst downgrade. Dubai’s index slid to a one-week low.

ADCB closed down 6.2 percent at 2.44 dirhams after dropping as much as 9.6 percent earlier, after Citigroup Inc. cut its recommendation on the shares to “hold” from “buy,” citing risk associated with money the lender is owed by the Saad and Algosaibi groups, which have defaulted on some of their loan repayments. The Dubai Financial Market General Index declined for the first time in five sessions, retreating 0.9 percent to 2,185.03, its lowest since Sept. 17. Oil fell for a second day.

“Our markets are down due to weaker international markets, weaker oil and on the back of very strong trading yesterday,” said Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital Ltd. “Exposure to Saad and Algosaibi groups is also having an impact, mainly on ADCB.”

Overnight report, blown away by mid-morning!

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Mashreqbank Among Seven U.A.E. Banks Downgraded at Fitch

Mashreqbank PSC, National Bank of Ras Al-Khaimah and Tamweel PJSC were among seven United Arab Emirates financial companies whose ratings were downgraded at Fitch Ratings today, citing reduced support from the country’s government.

The other companies whose ratings were cut include Bank of Sharjah, Commercial Bank of Dubai, Dubai Bank, Emirates Bank International.

Overnight report, blown away by mid-morning!

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Firms turn to debt collectors to recover dues

A British debt collection agency, based in the UAE, says the United Kingdom construction industry accounts for the largest segment of its client list in the UAE in 2009.

Financial Solutions has been appointed to recover outstanding amounts by more than 100 UK companies compared to the 15 firms it had on its books eight months ago. The company said it is pursuing in excess of £15 million (Dh90m) on behalf of these companies.

With an increase in construction disputes, the firm says its list includes construction companies, designers and architects alongside companies from the logistics, manufacturing, recruitment and other industries.

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Cityscape Dubai will accept last-minute requests for space

The organisers of Cityscape Dubai say they are willing to accept last-minute applications for exhibition space – but have ruled out offering discounts even though rates are seven per cent higher than last year.

The four-day real estate show opens at the International Convention and Exhibition Centre on October 5.

"We can accept new applications for a couple of more days, but only if the companies are willing to be accommodated in the space that is available," Rohan Marwaha, Group Director of Cityscape, told Emirates Business.

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Foreign investors stock up again

Foreign investors are back in action on the UAE stock exchanges.

A latest report shows that foreign ownership in 27 listed companies went up by 291.7 million shares in the first half of September.

Maha Kanez, an economic analyst at Al Fajer Securities who authored the report, said this is a confirmation that the two markets are attracting foreign money again, a key indicator of overall sentiment for the economy.

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Banks see an end to credit crisis

Banks in the UAE are emerging from a liquidity crisis and into a fresh credit cycle that will allow them to raise funds at “normalised” rates, according to Credit Suisse.

The prediction comes as some of the country’s largest lenders return to bond markets for the first time this year.

“It is already becoming easier for banks to raise money, for example through European or global medium-term notes like the one ADCB is planning. That was impossible six months ago, when these banks could not raise money,” said Mohammed Hawa, an analyst at Credit Suisse and author of a new report titled “Positioning for the next big thing.”

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Five-star hotel to be sold for homes

The five-star Angsana Dubai hotel on Sheikh Zayed Road is to be converted into homes, an apparent victim of the price war taking place in the city’s hotel sector.

The hotel’s owner, Damas, is selling the property for residential use because of the “challenging economic environment brought on by the global economic recession”, the Angsana’s management company said on Wednesday.

Singapore’s Banyan Tree Hotels, which has operated the hotel since it opened last year, said: “Damas Hotels and Banyan Tree Hotels and Resorts have agreed to amicably terminate the hotel management contract covering the Angsana Dubai with appropriate compensation.”

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Dubai’s forest of cranes grows thin

Burj DubaiImage by Elvis John Ferrao via Flickr

The last crane at the top of the Burj Dubai will come down soon, and that’s really the story of Dubai’s fast-disappearing crane culture. As existing projects are completed and the economic slowdown takes its toll on new construction, the city’s forest of cranes is thinning out and its skyline is noticeably changing.

At the peak of the building boom in 2006, the apocryphal statistic that Dubai had between 15 and 25 per cent of the world’s tower cranes was widely reported.

Some said there could be as many as one tower crane for every 44 residents. But industry experts say that while such “facts” made good headlines, they were unlikely to have ever been true.

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New Lockheed exec sees opportunities in Emirates

The former 5th Fleet commander recently tapped to head Lockheed Martin's business in the United Arab Emirates said Wednesday he sees "lots of opportunities" to work with the U.S. ally as it bulks up its defenses.

Charles "Willy" Moore gave few specifics about potential arms deals with the oil-rich nation, which lies directly across the Persian Gulf from Iran. But he did say he was confident negotiations will succeed to deploy a $7 billion missile defense system that could form part of a stronger missile shield for the region.

"Lockheed Martin's footprint here is expanding, it's becoming more complex," Moore told The Associated Press over the phone from Abu Dhabi. "As we look forward, we see lots of opportunities to deepen our partnership with the United Arab Emirates."

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Cityscape attendance tanks

The number of exhibitors at Cityscape Dubai looks to have plummeted by as much as 85 percent in a sign of how severely the emirate’s property market has been impacted by the global financial crisis, figures on Cityscape’s official website show.

There will be 141 exhibitors at this year’s exhibition, the Middle East’s flagship real estate expo, compared to 954 last year when the emirate’s property boom had reached its peak, the figures show.

There has been an 83 percent fall in exhibitors from the UAE and an 88 percent drop international exhibitors, according to the figures.

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UAE stocks update Sep 23 (Re-post)

UPP at 1.04 today.

See Aug 19 update and report on this stock. 1.13 level to watch by end of the month.

EMAAR

See Sep 7 update with new targets. 4.77 coming up

ARMX

Watch it to see where UAE stocks are going. See where we are by referencing an old post July 29

GULFNAV

See here Sep 6 no need to sell of course.

ARTC (very strong stock)

Rocketing through our levels mentioned Sep 7

3.36 looks important as a monthly closing level.

FGB has gained nicely today while AGTHIA has barely moved.

SOROUH, of course, is adjusting the ALDAR / SOROUH ratio mentioned on this blog in the past. It always does because there is very little difference between these two speculative companies.END

Deutsche Bank, Gosaibi battle in NY court

Deutsche Bank AG and a banking unit of Saudi Arabia's Al-Gosaibi family battled in court on Wednesday over whether to throw out a $74.2 million claim by the German bank, part of a flurry of lawsuits involving billions of dollars and allegations of fraud.

New York State Supreme Court Justice Bernard Fried said he expects to rule by Dec. 9 whether The International Banking Corp bsc, a Bahrain bank whose controlling shareholder is the Ahmad Hamad Al-Gosaibi and Brothers conglomerate, did sufficient business in New York to subject it to litigation in the state.

Several large Middle Eastern companies are caught up in a variety of litigation amid a feud between Algosaibi and the billionaire Maan al-Sanea, who married into the family.