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Monday, 2 November 2009

FT Alphaville » Blog Archive » Your CMBS tranche is in the mail

FT Alphaville » Blog Archive » Your CMBS tranche is in the mail



Monthly Funds Review - October 2009 Middle East Funds round up... (PDF)


Dubai Court Places $1B Attachment On Tameer Chmn's Accounts

A Dubai court has issued a precautionary attachment order of about $1 billion on the accounts of Tameer Holding Investment's chairman Ahmad Suleiman Al Rajhi who is in dispute with a shareholder in the company, documents seen by Zawya Dow Jones show.

The Dubai Court of First Instance on Oct. 29 notified Dubai Islamic Bank PJSC (DIB.DFM) of the order of 4 billion U.A.E. dirhams ($1.08 billion) on Al Rajhi's accounts, according to a copy of the court ruling.

A precautionary attachment order is a legal term used to place goods, or assets, under the protection of the court in order to safeguard any subsequent judgment.

Mashreqbank May Hold Settlement Talks With Algosaibi

Mashreqbank PSC Chief Executive Officer Abdul Aziz Al-Ghurair said the United Arab Emirates- based lender may hold talks to reach a settlement with Ahmad Hamad Algosaibi & Bros Co., a Saudi family group that defaulted.

“There are no talks but there are signs we may be heading in that direction,” Al-Ghurair said today at a forum in Kuwait City. “They started talking about some kind of settlements and offers which may include repaying some in installments.”

The bank, owned by billionaire Al-Ghurair, is suing Algosaibi in New York and the U.A.E. over failed foreign currency transactions. Mashreqbank said on Sept. 16 it was owed about $400 million by Algosaibi.

OPEC oil output falls in October: Reuters survey

OPEC oil supply fell in October, the first decline since April, due to lower output from Saudi Arabia, Iraq and Nigeria, a Reuters survey showed on Monday.

Supply from the 11 members of the Organization of the Petroleum Exporting Countries bound by output targets fell to 26.38 million barrels per day (bpd) from 26.40 million bpd in September, according to the survey of oil firms, OPEC officials and analysts.

Oil prices extended an earlier gain after the survey was released. U.S. crude was up 99 cents at $77.99 as of 1057 GMT (5:57 a.m. EST).

ENOC Bids for Rest of Dragon Oil to Tap Turkmenistan

Emirates National Oil Co., Dubai’s government-run refiner, offered to buy the rest of Dragon Oil Plc for about $1.15 billion to tap deposits in Turkmenistan and make up for dwindling supplies and meet rising demand at home.

The bid by Emirates National, known as ENOC, of 455 pence a share for the 48.5 percent of the Dubai-based explorer it doesn’t already own is 35 percent higher than Dragon Oil’s closing share price on June 3. Two days later, ENOC said it was considering an offer at a “modest premium.” Dragon Oil surged the most in London trading since it was first approached.

ENOC is seeking overseas assets to expand into oil and natural-gas production, which made up about 5.5 percent of Dubai’s $62 billion economy in 2007. Peter Hutton, a London- based analyst at NCB Stockbrokers Ltd., said investors should reject the offer because the financial crisis in the emirate is hampering ENOC’s ability to offer a fair price.

Bahrain's Baraka says Syria unit IPO oversubscribed

Bahrain's largest Islamic lender Al Baraka BARKA.BH said on Monday the initial public offering (IPO) of its Syrian unit has been oversubscribed.

"We have already 150 percent, and I anticipate we will close at around 200 percent," Chief Executive Adnan Yousif told Reuters.

The subscription period for the IPO -- open only to Syrians -- ends Nov. 4. Bank Bemo Saudi Fransi is managing the sale.

The bank is targeting some $38 million for a 35 percent stake in the unit, in which Al Baraka owns 24 percent and Emirates Islamic Bank holds 10 percent.

Dubai Shares End Longest Losing Streak Since July; Saudi Gains

Dubai shares ended their longest losing streak since July, led by gains in Emaar Properties PJSC and Dubai Islamic Bank, as investors speculated recent declines were overdone compared with prospects for earnings growth.

Emaar, the United Arab Emirates’ biggest developer, increased the most in three months, reclaiming some of the 17 percent slump in the previous four trading days. Dubai Islamic rose the most since June. The Dubai Financial Market General Index jumped 5.2 percent, the most since July 26 and the biggest gain among 89 benchmark indexes tracked globally by Bloomberg, to close at 2,185.29. The gauge lost 11 percent in the previous four sessions.

“It is a good time to start accumulating large caps” after the decline, said Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital Ltd. “The market corrected hard because of big gains following second-quarter earnings.” Dubai’s index advanced 23 percent and Abu Dhabi’s index added 19 percent in the third quarter.

NZ/Middle East FTA nears completion

New Zealand exporters looking for new markets in the Middle East will benefit from a new free trade agreement successfully negotiated between New Zealand and the Gulf Cooperation Council (GCC).

Trade Minister Tim Groser announced today negotiations between New Zealand and the GCC – made up of Bahrain, Oman, Kuwait, Saudi Arabia, the UAE and Qatar - had now concluded after six rounds

Negotiations between the two groups have been running since 2007 and the agreement should be signed in the first half of 2010.

GCC Petrochemical Sector Report - November 2009 (PDF)

Mizuho Said to Form Investment Bank in Saudi Arabia

Mizuho Financial Group Inc., Japan’s third-largest bank by market value, received a license to start offering investment-banking services in Saudi Arabia, said two people familiar with the situation.

The Tokyo-based company’s Mizuho Corporate Bank Ltd. unit and its Mizuho Securities Co. affiliate will officially open the business in Riyadh today, after getting approval from regulators in Saudi Arabia and Japan last week, said the people, who declined to be identified before the information is made public.

Mizuho joins Nomura Holdings Inc., Japan’s biggest brokerage, in starting investment-banking operations in Saudi Arabia. Morgan Stanley and Goldman Sachs Group Inc. have also entered the Arab state, seeking to profit from wealth created by rising oil prices.

HSBC aims to increase its SME portfolio in the UAE (Interview)

A number of companies are complaining that banks are not lending despite the government's move to improve liquidity. A handful are saying banks are not acting as banks at the moment.

But John Coverdale, Group General Manager and Global Co-Head of Commercial Banking, HSBC, believes all these perceptions are far from true.

"No bank can stand still," Coverdale told Emirates Business in an exclusive interview. "It is a convenient excuse for some to perhaps say, 'well they don't want to lend'.

HSBC, he said, is open for business with those who have bankable propositions. The bank is putting emerging markets on priority and is looking at increasing its small and medium business portfolio, which forms 80 per cent of its customer base in the UAE.

Financial firms hurt by crisis but profits keep coming

Financial brokerage companies in the UAE are still making profits despite taking a hit from the global recession, which has resulted in a 57 per cent drop in revenues in the sector, according to a study.

The study, conducted by Truth Economic Consultants in Abu Dhabi, also found that the majority of financial brokerage houses are still operating and are generally optimistic about the future.

The study made a comparison of the results of 32 financial brokerage companies in the first half of 2009 with those of the same period last year

HSBC eyes second tranche of Dubai's $20bn bond plan

HSBC is looking at subscribing to the second tranche of Dubai's $20 billion (Dh73.4bn) bond programme, a senior bank official said.

The bank may use it for its investment portfolio, that is it will buy bonds and distribute them to its private banking customers or it may use it for its trading book, said John Coverdale, Group General Manager and Global Co-Head of Commercial Banking at HSBC.

"Yes, we are looking at them. We will make a decision according to the pricing and other different dynamics," Coverdale told Emirates Business.

Gulf bankers call for stronger oversight

Gulf economies need more regulation to strengthen the banking system and stave off a repeat of the financial crisis, regional bank chiefs said in Kuwait.

“The promotion of financial stability is the duty of decision makers because it is evident that banks cannot be relied upon to do that,” Mohammed al Jasser, the governor of Saudi Arabia’s central bank, said at the Kuwait Financial Forum.

“In other words, self-supervision is no supervision.”

Impairment charges leave Shuaa with loss near Dh270m

Shuaa Capital wrote another loss for the third quarter after setting aside Dh260 million (US$70.7m) in charges for investments in associated companies, some of which are marked for sale.

The impairment charges, plus another Dh42.5m in provisions, left Shuaa with a Dh269.7m loss for the September quarter.

The 30-year-old bank, based in Dubai, has had a challenging nine months that saw it cede a 48 per cent stake to the government-owned Dubai Banking Group and become involved in a bitter legal battle with Dubai World, the emirate’s investment arm.

Abdullahs promise to repay Damas

A Damas International senior executive said he and his brothers would within two years repay the jeweller for the US$165 million (Dh606m) in unauthorised transactions that forced one of them to resign as chief executive.

Tamjid Abdullah, the deputy managing director, and his brothers own more than half of Damas, will pay for the full value of the deals by using their own assets and properties.

“The assets which we brothers have can cover way more than that deficit,” he said in an interview yesterday.

Al Sanea operated $10bn ‘Ponzi scheme’, says Al Gosaibi

Maan al Sanea, the head of the embattled Saad Group of Saudi Arabia, “operated one of the largest Ponzi schemes in history”, according to documents filed in a New York court.

“He fraudulently arranged for the borrowing of billions of dollars from dozens of banks, steadily increasing the loan levels year-by-year,” the filings allege. It is the latest legal broadside from the al Gosaibi family, which is locked in a bitter dispute with Mr al Sanea over what it claims is a US$10 billion (Dh36.73bn) fraud.

A Ponzi scheme is a type of fraud in which investors are paid out of illusory profits which are actually fresh money injected into the business by new investors. The most famous example is the $68bn fraud by the disgraced US financier Bernard Madoff.
The claim, which Mr al Sanea has denied, came amid a flurry of legal action in New York late last week. The al Gosaibis made fresh allegations against Mashreqbank of Dubai in the ongoing battle between them over $400 million in disputed foreign exchange transactions.

Why did the Saudis abandon the NYMEX oil futures contracts? (Re-post)

Now here's a real important story. If you are an oil trader, chances are you traded the New York Mercantile Exchange West Texas Intermediate (WTI) contract. World pricing of oil by the biggest exporters was based on the WTI contract.

Now, suddenly, Saudi Arabia has decided to drop the WTI contract as the benchmark pricing unit for its oil. It is substituting a contract called the Argus Sour Crude Index, which will track the price in the physical market of a basket of U.S. gulf coast crudes, including Mars, Poseidon, and Southern Green Canyon.

What caused this drastic change by Saudi Arabia? Normally WTI crude trades at a premium of $1.00 to $2.00 to Brent Crude. Last January, there was so much oil stored in Cushing, Oklahoma, that WTI fell sharply, selling at a discount of $12.00 to Brent. This threw the oil market into disarray, angering the Saudis. This prompted the change of contracts by the Saudis from WTI to the Argus Sour Crude index. Argus is a London-based company, hence most of oil trading by the big players will now shift to the Argus index in London.

Bahrain working out a solution to joblessness

Bahrain has launched a new initiative aimed at reducing unemployment levels by replacing high numbers of expatriates with nationals.

The new programme aims to place 35,000 well-educated Bahrainis with high skill levels in positions currently held by qualified expatriates and to train 150,000 nationals with high school degrees to take up entry level positions in the private sector.

The official unemployment rate in Bahrain stands at 3.5%, although the actual figure is believed to be much higher.

Gulf single currency may face delay: bank chief

Gulf states plan to launch their monetary council, a precursor for a joint central bank, in 2010 but the planned single currency may be delayed, the Saudi central bank chief said on Sunday.

"The (Gulf) monetary council will be established in 2010. It will be entrusted to complete other procedures," Mohammad al-Jasser, head of the Saudi Arabian Monetary Agency (SAMA), told reporters in Kuwait.

The "procedures," such as the launch of the single currency, "will be completed in the correct way to achieve the required results," Jasser said on the sidelines of the first Kuwait Financial Forum.

Qatar fund aims to diversify through Asia

Qatar Holding, the direct investment arm of the Qatar Investment Authority, will soon open an office in China as it seeks to boost its growing investment portfolio in the Far East, its chief executive says.

It hopes the office will open up more opportunities in China as it hunts down similar investments to those it has in Credit Suisse, Barclays and Volkswagen/Porsche.

“Asia is a growth market for us – we are really serious about finding the right opportunity there,” Ahmad al-Sayed told the Financial Times in his first interview since becoming chief executive in October last year.