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Wednesday, 25 November 2009

FGB $500m bonds priced at 250bps over mid-swap

UAE-based First Gulf Bank's $500 million (Dh1.8 billion) three-year bonds were priced at 250 basis points over mid-swaps, representing a coupon of four per cent, an executive of the bank said.

The bonds were issued under FGB's recently updated $3.5bn European Medium Term Note Programme.

FGB, the second-largest bank by market capitalisation in Abu Dhabi, completed the sale of bonds last week to investors in Asia and Europe. The bonds are for general corporate purposes and to have a diversified funding mix, he said.

Economic recovery is confirmed next year – but not its shape

Recovery, as various economists propose, may come in the shape of U, V, W, L and some even said it may not be an alphabet character but a mathematical one such as the square root.

In a press briefing with the media, Standard Chartered top economists did not say, which shape growth will look like.

But two things are certain, they say, that there is growth next year and that the possibility of a double dip, which looks like a flash of lightning shape, is unlikely.

British bankers offer harsh advice on Saudi dispute

The fallout from the al Gosaibi-al Sanea battle in Saudi Arabia is “doing enormous damage to the reputation of Saudi Arabia as a whole. What appears to have started as a family dispute is now bringing the whole business sector and Saudi system of corporate governance into disrepute”.

Who says so? None other than the august British Bankers’ Association (BBA). In a strongly worded letter to Lord Davies, the UK business minister, the chairman of the BBA trade policy committee, Thomas Harris, criticises the Saudis’ handling of the whole sordid affair and urges the minister to do something about it on his forthcoming trip to the kingdom.

As you would expect from an organisation representing the interests of the UK financial industry, the BBA is normally a rather restrained and conservative organisation. But from time to time it lets loose.

Emerging Markets to Attract Sovereign Funds, Credit Suisse Says

Middle East sovereign wealth funds may boost investments in emerging markets to 25 percent of new ventures by 2016 as economic growth surges in the developing world, according to Credit Suisse Group AG.

The funds will invest in Africa, Brazil, China and India because “so much wealth is being created” there, George Pavey, a managing director at Credit Suisse’s global markets solutions group, said in an interview today in Dubai. “I wouldn’t be surprised if five or seven years from now a quarter of their new capital is directed to emerging markets,” he said.

Gulf Arab states, including the United Arab Emirates, Qatar, Kuwait and Saudi Arabia, pump about 20 percent of the world’s crude oil and are flush with cash after oil climbed to a record $147.27 in July 2008. The Abu Dhabi Investment Authority managing $328 billion at the end of 2008, economists at the New York-based Council on Foreign Relations estimated in January. The Kuwait Investment Authority had $228 billion, and the Qatar Investment Authority managed $58 billion, the report said.

Abu Dhabi Limits Housing Construction to Avoid Glut, Aldar Says

Abu Dhabi is limiting construction to avoid the housing glut and price declines that battered the real estate market in neighboring Dubai, Aldar Properties PJSC Chief Executive Officer John Bullough said.

The Emirate has a shortage of 15,000 to 20,000 units and the government will let the “rope out on development in a measured way,” Bullough, whose company is the United Arab Emirates’ second-biggest developer, said in an interview. “There will be, in our view, a lag between supply and demand.”

Abu Dhabi, the U.A.E.’s capital and holder of 8 percent of the world’s oil reserves, controls development from homes to offices and transportation links under “Plan 2030,” devised in 2007. The plan foresees the population growing to as much as 5 million by 2030 from an estimated 1.6 million in 2008.

BankDhofar: Conservative regulator helps Omani banks

OBG interviewed Kris Babicci, the CEO of BankDhofar, about the post-crisis re-emergence of the banking sector in Oman.

To what degree have Omani banks fared better than counterparts in the rest of the region during the credit crunch?

Babicci: The strong, conservative nature of our regulator has helped Omani banks fare better than their counterparts in the region. The government and the Central Bank of Oman (CBO) have done a great job during this period. Omanis remember previous down cycles, such as the Asian financial crisis last decade and the more recent real estate collapse. This has led to more conservative policies and these policies are the reason we've fared better in Oman. The market is recovering and there are many opportunities for the Bank to capitalise on.

Iran, Oman discuss energy ties

Iranian Oil Minister Masoud Mirkazemi and Omani Oil Minister Mohammed Al-Ramahi met here on Tuesday, starting a new round of talks on bilateral energy cooperation.

Gas swap, gas transit, Iran’s gas export to Oman, and bilateral investments in the gas sector are among the major topics discussed, IRNA reported.

The development of the Kish and Hengam gas fields in the Persian Gulf, and joint construction of petrochemical units are the other major topics that will be discussed during the upcoming negotiations.

Nomura, BNP named advisers in Kuwait Zain deal

Kuwait's Kharafi Group, which has agreed to sell a 46 percent stake in telecoms firm Zain (ZAIN.KW) to a consortium of Asian investors, has named BNP Paribas (BNPP.PA) as its adviser in the sale, a Kharafi official said.

Japanese bank Nomura (8604.T) has been named the adviser to the consortium, led by India's Vavasi Group, Kharafi Group vice chairman Bader al-Kharafi told Reuters on Tuesday.END