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Thursday, 19 August 2010

Sukuk at Four-Year Low Yields Failing to Deter Investors: Islamic Finance - Bloomberg

Islamic bond yields at four-year lows are failing to deter investors amid a flagging global recovery and dwindling new issuance of sukuk.

The average yield on dollar-denominated notes that comply with religious principles from Dubai to Malaysia fell 22 basis points, or 0.22 percentage point, so far this week to 5.25 percent, the lowest level since December 2005, according to the HSBC/NASDAQ Dubai US Dollar Sukuk Index. The yield has dropped 200 basis points this year.

Investors will flock to the bond market until they are more convinced about the strength of the world economy, according to Malaysia’s CIMB-Principal Islamic Asset Management Bhd. and OSK- UOB Unit Trust Management Bhd. Demand for sukuk in the Persian Gulf is starting to pick up as the credit crisis eases and companies restructure debt, improving the outlook for future issues, according to Dubai-based Duet Mena Ltd.

Gulf Finance First-Half Loss Narrows to $47.7 Million as Expenses Decline - Bloomberg

Gulf Finance House EC said its first-half loss narrowed after it cut costs and liabilities as the Bahrain-based investment bank restructures its business.

The loss was $47.7 million after $92.1 million in the year- earlier period, the Manama-based bank said in an e-mailed statement today. Expenses fell 54 percent to $73.6 million, while liabilities were reduced to $965 million at the end of June from $1.8 billion a year ago.

Gulf Finance is restructuring after the global financial crisis reduced lending, hurting companies and investors in the region. The company said Feb. 10 it repaid a $200 million loan to the group of 32 lenders led by WestLB AG. Gulf Finance this month reached an accord on a $100 million Islamic loan.

MIDEAST STOCKS-Kuwait banks surge, DP World hits 15-wk high | Markets | Reuters

Banks in Kuwait rose on Thursday after reports that the government gave a green light to local lenders to finance a 30 billion dinar development plan and is prepared to back them with guarantees.

Most other Middle East markets also closed higher, backed by higher oil prices and an upbeat performance of Asian markets amid average volumes during the month of Ramadan. [MKTS/GLOB]

Port operator DP World (DPW.DI: Quote), which is listed on the Nasdaq Dubai, extended its gains, hitting a 15-week high, one day after posting its half-year results.

Univest Brokerage of Dubai to Close After Trading Volumes, Stocks Tumble - Bloomberg

Dubai’s Univest Brokerage sought approval from the United Arab Emirates’ market regulator to halt operations for a year, joining more than 10 companies making similar requests, after trading volumes and stocks slumped.

“We have been suffering from a drop in market liquidity and volumes,” Amr Nashaat, Univest’s operations manager, said in a phone interview from Dubai today. “We were not making enough to break even despite attempts to cut costs and we most likely won’t reopen next year.” Univest has 15 employees and 160 clients, Nashaat said.

The volume of shares traded in Dubai has plummeted to a daily average of 166 million this year from 468 million in the year-earlier period. Dubai’s benchmark index of 32 stocks has slumped 82 percent to 1,493.33 since reaching a record in November 2005.

Investcorp to Delist GDRs on London Stock Exchange, Offering $4.76 a Share - Bloomberg

Investcorp Bank BSC, the Bahrain- based alternative investment firm, will make an offer to buy back as much as 7.92 million global depositary receipts at $4.76 each.

The GDRs are listed on the London Stock Exchange and the company has sought regulator’s permission to delist the securities from Oct. 4, Investcorp said in a statement to Bahrain bourse today. After the cancellation of the listing of the GDRs, Investcorp’s shares will continue be traded on the Bahrain Stock Exchange, it said.