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Wednesday, 21 April 2010

UAE bad loan provisions up 2.4 pct in | Reuters

Banks in the United Arab Emirates saw provisioning levels for non-performing loans rise 2.4 percent in March compared to the previous month to reach their highest level since at least December 2008, data showed.

UAE banks' problem debt provisions stood at 34.4 billion dirhams ($9.37 billion) compared to 33.6 billion at the end of February, the central bank's UAE banking indicators showed on Wednesday.

The domestic banking sector has been grappling with the fallout of the global economic crisis and a local property market downturn, as well as the restructuring of Dubai's flagship conglomerate Dubai World [DBWLD.UL].

Banks' combined loans climbed to 1022.0 billion dirhams at the end of March, from 1017.5 billion in February. Bank deposits rose to 967.0 billion dirhams, from 958.3 billion at the end of the previous month.END

Arqaam Capital updates you on the MENA equity markets

Tabreed to Consider Alternatives on Bond Payments

National Central Cooling Co., the United Arab Emirates-based refrigeration company, said the board will this month consider “alternatives” to annual payments on 1.7 billion dirhams ($463 million) of Islamic bonds.

Board members will meet on April 25, it said in a statement to the Dubai bourse today, without providing details. The company, known as Tabreed, said March 8 it is seeking approval from shareholders to renegotiate terms on a $200 million floating-rate note and the local currency-denominated convertible sukuk maturing in 2011.

Tabreed is among Gulf Arab companies seeking to restructure debt after the global economic crisis dried up financing and brought a property boom to a halt. Dubai World, one the emirate’s three main state-owned holding companies, is negotiating with lenders to restructure $24.8 billion of debt after roiling global markets by proposing a freeze on loan repayments in November.

IMF Says Impact of Dubai World May Not Be Felt for ‘Some Time’

The full impact of Dubai’s $24.8 billion debt postponement on the region’s economies may not be felt for “some time,” the International Monetary Fund said.

“In particular, a possible re-pricing of quasi sovereign debt could have a lasting effect on financial systems, corporate sectors, and, more generally, economic activity in the area,” the IMF said today in its World Economic Outlook.

State-owned Dubai World’s announcement in November that it planned to restructure debts, following defaults by two Saudi Arabian groups, has made banks more reluctant to lend and disrupted bond sales across the Middle East. That’s slowing recovery from last year’s recession, caused by slumps in property and oil prices and global trade.

Saad Group Hasn’t Reached Accord With Banks on Debt

Saad Group, the business owned by Saudi billionaire Maan al-Sanea that is seeking to delay payments on at least $6.5 billion of debt, hasn’t reached an agreement with its creditors to restructure the loans, Chief Financial Officer Maan al-Zayer said.

“I would tend to say that banks lend money, whether it’s to Saad, Algosaibi or any other entity, and banks will be able to get their money back in due course,” al-Zayer told reporters in Riyadh today during a conference. Saudi courts are the best alternative to settle the debt dispute between banks and stakeholders, he said.

Saad Group, originally a contracting company that has diversified into real estate, education, finance and health care, said in June 2009 that the Al-Khobar-based company was restructuring debt after a “short-term liquidity squeeze.” It owes at least $6.5 billion to almost 60 banks from five loan syndications, according to documents provided by lenders.

Nakheel Said to Offer Trade Creditors 10% Return on New Bonds

Nakheel PJSC, the unit of Dubai World that is restructuring $10.5 billion of debt, plans to pay an annual profit of 10 percent on Islamic bonds it seeks to issue to trade creditors, said two people familiar with the proposal.

The deal is conditional on trade creditors representing at least 95 percent of the value of all claims agreeing to the proposal, according to the people who declined to be identified because the plan hasn’t been made public. Nakheel plans to issue the five-year bonds in July and list the securities on Nasdaq Dubai.

If trade creditors, including contractors and suppliers, don’t accept the terms, they can appeal to a tribunal established last year to resolve Dubai World related disputes, one of the people said.

DMCC's DSAM Kauthar Commodity Fund named 'Best Fund-of-Funds'

DMCC's DSAM Kauthar Commodity Fund named 'Best Fund-of-Funds' - Business Intelligence Middle East - - News, analysis, reports

In recognition of its outstanding performance, Dubai Shariah Asset Management (DSAM) Kauthar Commodity Fund was named ‘Best Fund-of-Funds’ at the annual Falaika Islamic Fund Awards.

This announcement was made today by Dubai Multi Commodities Centre (DMCC). The annual Falaika Islamic Fund Awards recognises top performers in the global Shariah-compliant investment marketplace.

The DSAM Kauthar Commodity Fund, the first Shariah compliant fund-of-funds of its kind, generated a net return of 41.19% in 2009, leading both the conventional and Islamic fund industries. This is the third award for DMCC’s industry leading fund this year.

Dubai World Unit Said to Arrange Loans for Inchcape Acquisition

Dubai World’s investment unit Istithmar World PJSC is arranging as much as $350 million of loans to attract bidders to its Inchcape Shipping Services, two people familiar with the matter said.

The so-called staple financing will be available for any bidder for Inchcape Shipping and comprises senior leveraged loans and junior debt due in about six and eight years, said the people, who declined to be identified because the information is private.

Bank of America Merrill Lynch and Royal Bank of Scotland Group Plc are arranging the financing, the people said.

Kingdom Holding First-Quarter Profit Advances 50%

Kingdom Holding Co., the investment company owned by Saudi billionaire Prince Alwaleed bin Talal, said first-quarter profit advanced 50 percent on revenue growth from hotels and the performance of investments.

Net income rose to 75.2 million riyals ($20.1 million), or 0.02 riyal a share, from 50.2 million riyals, or 0.01 riyal, in the year-earlier period, the Riyadh-based company said in a statement to the Saudi bourse today.

“Subsidiaries and investments performed well with resilient revenue growth delivered across our hotels and real- estate investments,” Prince Alwaleed said in a separate e- mailed statement.

Pssst... Saudi Arabia Needs $60 Oil Just to Break Even These Days

Talk about getting comfortable with the multi-year commodities super-spike we've had...

Saudi Arabia's National Commercial Bank has disclosed that its government requires $60 just to break even on its budget these days.

Yet they're actually aiming for $75 oil in 2010, which will provide them with a healthy $24.3 billion budget surplus.

Qatari firm vows to revive Oman project

Qatari investment company Bin Muhanna Holding Group yesterday announced its participation as a main partner in the major Blue City project being set up in Oman by the UDM Group and Bahrain-based A A J Holding.

Bin Muhanna Holding chairman Dr Najeeb bin Mohammed Al Noaimi said the firm were happy at becoming part of the major project.

"We will now approach international banks, investors and insurance companies in order to restore confidence in this project, which has been facing obstacles and hindrances, and realise its objectives.