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Wednesday, 5 May 2010

Qatar Stocks Lead Gulf Declines on Europe Debt Risk, Oil Drop

Qatar shares retreated the most in three months, leading declines in the Gulf, as oil fell and amid concern that Europe’s debt crisis will spread beyond Greece and curtail a global economic recovery.

Qatar National Bank SAQ, the Persian Gulf country’s biggest lender by assets, retreated the most since February. Saudi Basic Industries Corp., the world’s biggest petrochemicals maker, is poised for the biggest drop in more than two weeks. Qatar’s DSM 20 Index lost 1.3 percent, the most since Feb. 7, to 7,415.72. Saudi Arabia’s measure declined 1 percent as of 2:57 p.m. in Riyadh. In North Africa, Egypt’s gauge fell 2.3 percent.

“Middle East and North Africa markets are trading in sympathy with Europe,” said Rabih Sultani, a fund manager at Duet Mena Ltd. in Dubai, a unit of Duet Group, which oversees $2.1 billion. “There’s a fear the Greek crisis will spread to Portugal, Spain and Italy.”

Global Holders Approve $346 Million Capital Increase

Shareholders in Global Investment House KSCC, which is restructuring $1.73 billion of debt, approved raising the company’s capital by 100 million dinars ($346 million) to give a total of 231.2 million dinars.

The Kuwait-based investment bank plans to offer 1 billion shares with a nominal value of 100 fils and a premium of 5 fils. There are 1,000 fils to the dinar.

“I believe the 100 million dinars now is important for enhancing the financial position of the company and for safeguarding against what could happen in the future if the price of assets doesn’t improve in the short-term,” Maha al- Ghunaim, chairwoman and managing director, told reporters after a shareholders’ meeting in Kuwait City today.

Fund managers warm to Saudi Arabia

Saudi Arabia might not be everyone’s cup of tea, but, unsurprisingly, fund managers can’t help but love a country that sits on top of the world’s largest pool of oil.
According to a report today by Kuwait Financial Centre - an investment bank popularly known as Markaz - interest in most other Gulf markets has waned but allocations to the conservative kingdom have increased over the past six months.
Saudi Arabia
Other Mena
The larger allocations to Saudi Arabia, as shown in the table, are mainly a natural reflection of the fact that it is the largest Arab economy, and the Saudi Tadawul exchange is the biggest stock market by some distance.

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RBS May Sell U.A.E. Retail Unit to ADCB, Bankers Say

Royal Bank of Scotland Group Plc, the biggest U.K. government-owned bank, is in talks to sell its retail banking assets in the United Arab Emirates to Abu Dhabi Commercial Bank PJSC, three bankers familiar with the deal said.

The transaction is valued at about $280 million, according to two of the bankers, who declined to be identified as details haven’t been completed. The third banker said the amount is likely to be lower. Abu Dhabi Commercial Bank is the U.A.E.’s third-largest bank by assets.

RBS, the 83 percent government-owned bank, is selling assets as part of a global plan announced in February last year to scale back its international presence. RBS acquired the U.A.E. consumer banking unit in 2007 after a group including RBS, Banco Santander SA and Fortis bought ABN Amro Holding NV for about 72 billion euros ($98.5 billion) in the world’s biggest banking takeover. The sale of the U.A.E. unit is subject to regulatory approval.

Sama Dubai Halted Work in Morocco, Oman, State Officials Say -

Sama Dubai Halted Work in Morocco, Oman, State Officials Say -

Sama Dubai LLC, part of the group building a Tiger Woods golf resort in the emirate, said it’s committed to projects in Morocco and Oman after government officials from those countries said its work had stopped.

Sama pulled out of the $3 billion Amwaj development in Morocco and construction was halted on the $1.7 billion Salam Yiti development in Oman, tourism ministry officials said.

“International investors are still there,” Moroccan Tourism Minister Yassir Zenagui said in an interview in Dubai. “But some of them have pulled back, such as Sama Dubai from the Emirates.

Mubadala sees massive asset growth

Mubadala Development Company, the Abu Dhabi Government's investment arm, said yesterday its assets in the three years since the end of 2006 have grown from just under Dh18 billion to more than Dh88.5 billion.

"We currently have nine business units operating in diverse sectors and geographical territories," Waleed Ahmad Al Mokarrab Al Muhairi, Mubadala's chief operating officer, wrote in the company's annual report for 2009.

Mubadala said its total income for the financial year ended December 2009 was Dh8.6 billion, while revenue rose to Dh13.1 billion.

Low-Cost Carriers Will Double Middle East Share, FlyDubai Says

Middle East discount carriers are likely to double their share of the air travel business to about 15 percent in the next three years as the market is “underserved,” FlyDubai Chief Executive Officer Ghaith Al Ghaith said.

Discount carriers including FlyDubai have a 7 percent share of the Middle East air travel market and “there is definitely room to improve and grow,” Al Ghaith said in an interview at the Arabian Travel Market in Dubai today. “We believe the market is underserved.”

FlyDubai, which began operations in June, Sharjah-based Air Arabia PJSC and Kuwait-based Jazeera Airways KSC are boosting the share of low-cost carriers in Middle East air travel. Discount carriers had 30 percent of the air travel market in the U.S. and 39 percent in Europe this month, according to figures from the Geneva-based International Air Transport Association.

U.A.E.’s Bid for Caspian Gas May Weaken Russia’s Hold on Europe

The United Arab Emirates is tapping its $328 billion sovereign wealth fund to invest in gas-rich Turkmenistan, seeking fuel for its own use while potentially challenging Russia’s dominance as a supplier to Europe.

“We want to invest and we’ve been conducting negotiations for a long time,” U.A.E. Oil Minister Mohamed al-Hamli said in an interview in the Turkmen capital, Ashgabat. “We have a special relationship with Turkmenistan. There is a genuine interest and a genuine determination with both countries to exploit this possibility.”

Access to Turkmen gas reserves, the world’s fourth-largest, would help the U.A.E. curb imports of the fuel as growing demand from power stations outstrips supply. At the same time, the Arab country has a stake in a planned pipeline to Europe, which gets a quarter of its gas from Russia and suffered shortages last year as exporter OAO Gazprom and transit nation Ukraine bickered over prices.

Financial sector facing impact of global crisis

As the dust settles after the financial crisis it has become increasingly clear that there will be no return to business as usual for the financial industry.

That was the message from Central Bank of Bahrain Governor Rasheed Al Maraj to delegates at the opening of the seventh Annual Islamic Finance Services Board (IFSB) meeting at the Ritz-Carlton Bahrain Hotel and Spa yesterday.

"In the advanced economies, there is a determination to make sure that there is no risk of a repeat of the crisis and in practice this means financial institutions will be smaller and less profitable than in the past," he said.

Dubai Group may not sell Bank Islam stake

Dubai Group may not be keen to sell its stake in Malaysia's No. 2 sharia lender Bank Islam, the Business Times reported on Wednesday, citing a source. "They may not sell after all because they see value in the bank," the source was quoted as saying in a Business Times report.

Dubai Group, an investment vehicle owned by the ruler of Dubai, said last month that its plan to sell Bank Islam was unlikely to be completed by June. The sale was to help the Middle Eastern investor shift its focus closer to home and settle its debt burden.

Dubai Financial Group, a unit of Dubai Group, holds a 40 percent stake in the Malaysian lender, according to Bank Islam's website.

Qatar's TFI looks to Brazil and Russia

A Qatari investment company linked to the country's sovereign wealth fund plans to launch two $500m funds to invest in Russian and Brazilian real estate, a further sign of deepening economic links between emerging market countries .

The First Investor (TFI), a company controlled by Qatari Diar, the real estate arm of the Qatar Investment Authority (QIA), will partner Gazprombank in Russia to launch a mostly Moscow-focused real estate fund in October 2010.

The two parties have so far committed a total of $150m to the fund, which is targeting a rate of return of 20 to 25 per cent.