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Sunday, 23 January 2011

Commercial Bank of Qatar Fourth-Quarter Profit Jumps 66%; Misses Estimates - Bloomberg

Commercial Bank of Qatar, the Persian Gulf country’s second-biggest bank by assets, posted a smaller-than-expected 66 percent rise in fourth-quarter profit as loan growth failed to keep pace with deposits.

Net income for the three months ended Dec. 31 was 309 million riyals ($85 million), the Doha-based bank said in a statement to the Qatar Exchange today. The mean estimate of five analysts was for a profit of 443 million riyals, according to data compiled by Bloomberg. The bank reported a 7 percent increase in full-year profit to 1.64 billion riyals. Full-year loans and advances rose 5 percent to 33.6 billion riyals, while customer deposits jumped 27 percent to 33.3 billion riyals.

"The growth rates on deposits have been pretty good," Jaap Meijer, head of the bank team at AlembicHC in Dubai, said in a phone interview before the results were announced. "Loan growth hasn’t been that impressive compared to other banks."

Dubai PE firm Abraaj to invest $2 bln - Maktoob News

Dubai-based Abraaj Capital expects to invest $2 billion in 2011 and 2012, and the private equity firm is eyeing a number of deals this year, its top executive said, signalling a revival for the battered industry.

"We have a fund which is worth $2 billion dollars, and we are looking to deploy most of it this year and next year," Arif Naqvi, Abraaj's chief executive officer, told reporters on the sidelines of an investment conference in Riyadh on Sunday.

The private equity firm expects to complete several deals during the year.

DP World Exploring Business Cooperation With Abu Dhabi, COO Says - Bloomberg

DP World Ltd., the Dubai government- controlled ports operator, may cooperate in business with Abu Dhabi and is not threatened by the neighboring emirate’s development plans, Chief Operating Officer Anil Wats said.

DP World said Dec. 30 it would hand over management of Abu Dhabi’s Mina Zayed port to Abu Dhabi Terminals in January and that the company didn’t reach a binding accord to manage the new Khalifa Port being built between the two cities.

DP World, the world’s fourth-biggest port operator, is comfortable with the capacity of its flagship Jebel Ali port in Dubai and will consider an expansion if demand is sufficient, Mohammed Al Muallem, the company’s managing director for the United Arab Emirates, told reporters on a tour of the facility today.

Etisalat Plans to Depend on Bank Loans in $12 Billion Offer for Zain Stake - Bloomberg

Emirates Telecommunications Corp., the biggest phone company in the United Arab Emirates, plans to finance its $12 billion offer for control of Kuwait’s Mobile Telecommunications Co., in three stages of loans.

“The first $6 billion will be a bridge loan, payable in 18 months,” Chief Financial Officer Salem al Sharhan said in a phone interview today. The Abu Dhabi-based company will also borrow $3 billion payable in three years and another $3 billion payable in five years, he said. The $6 billion bridge loan will be refinanced through bonds and sukuks, al Sharhan said.

The company, also known as Etisalat, has agreement from 18 international and regional banks on the initial term-sheet for the loan, he said. The majority of the banks are international lenders with four regional players, including Saudi Arabia’s Samba Financial Group, National Bank of Abu Dhabi PJSC, Emirates NBD PJSC, and National Bank of Kuwait, he said.

Qatar Stocks Drop Most in Two Months on Oil Decline; Kuwait's Index Gains - Bloomberg

Qatar’s stocks dropped the most since November after crude closed below $90 a barrel and as investors remained cautious before Commercial Bank of Qatar results. Israel’s gauge declined for a second day.

Industries Qatar QSC, the second-biggest petrochemicals maker in the Middle East, lost the most since May 25. Commercial Bank of Qatar, the country’s second-largest lender, retreated 2.2 percent. Masraf Al Rayan, an Islamic lender, decreased 1.5 percent. The QE Index slid 1.5 percent, the most since Nov. 23, to 8,931.94, at the 12:30 p.m. close in Doha. The measure has gained 16 percent since the end of the third quarter. Israel’s TA-25 Index, fell 0.1 percent at 12:15 p.m. in Tel Aviv.

“Sentiment on oil remains cautious after last week’s performance,” said Amro Halwani, a trader at Shuaa Capital PSC in Riyadh. “Wary investors are also cutting down their exposure to banks as they cautiously wait for Commercial Bank of Qatar results to come out before committing any additional funds.”

Gulf Arab Banks' Loan Losses to Drop in 2011 After Impairments, Fitch Says - Bloomberg

Gulf Arab banks, including those in Saudi Arabia and the United Arab Emirates, are likely to report lower loan and investment losses in 2011 because impairments due to the global credit crisis have peaked, Fitch Ratings said.

"Lower impairment charges and cost control should lead to a gradual improvement in profitability, but revenue growth will be more difficult to achieve," the ratings agency said in an e- mailed report today. "Loan growth has been generally low, as the banks remain cautious and there is limited demand, but Fitch expects revenue to increase as infrastructure projects come on stream, stimulating the local economies."

Governments in the six-nation Gulf Cooperation Council, which also includes Kuwait, Qatar, Bahrain and Oman, are boosting spending on infrastructure projects. Oil prices above $90 a barrel will support the spending plans, Fitch said. The six GCC nations supply about a fifth of the world’s oil.

Kuwait Finance House Seeks to Reverse Provisions, Al-Watan Says - Bloomberg

Kuwait Finance House is awaiting central bank approval to reverse about 21 million dinars ($75 million) of provisions, which would be added to the bank’s 2010 results, Al-Watan reported, citing people familiar with the matter.

A Kuwait Finance spokesman was not immediately available for comment when contacted by telephone.

Upper Egypt oil fields to attract investment-oil min | Reuters

Egypt's Oil Ministry said on Saturday it expected an influx of new investment and agreements with international companies for further oil research and exploration in seven of Upper Egypt's pristine areas.

Sameh Fahmi, Egypt's petroleum and mineral resources minister, said a discovery of oil in the country's southern Al-Baraka field and the presence of an active oil system in Upper Egypt would cause a significant change in the country's petroleum map.

In 2010, Egypt's South Valley Holding Company for Petroleum offered the lands in an international auction after four discoveries in Al-Baraka field. The bidding will close late January.

Aldar on the Edge — Abu Dhabi Stock Analysis — GCC Market Analytics

How the mighty have fallen. Aldar Properties joins a steadily increasing list of UAE companies that have required financial assistance.

But Aldar is significant in that it is the first big Abu Dhabi company to get itself into trouble (from my knowledge, anyway). We're used to this kind of thing with Dubai companies but Aldar's situation shows that problems exist further afield.

One analyst report I read claimed that Aldar wasn't the subject of a bailout but was just raising funds, like any other company might do. So, Aldar's a bit like Facebook then. Just raising a bit of capital

Well, bailout or not, Aldar's stock price is teetering on the edge. As the chart below shows the current stock price is sitting at the 2 dihrams level.

Aldar Properties - Abu Dhabi Stock Market

The two previous times Aldar's share price has visited this level (late 2008 and mid 2010) the stock has rallied. And what about this time? Under the circumstances you would think it's probably going to be a case of third time unlucky.

What Aldar does could be important to the wider Dubai and Abu Dhabi markets. Aldar is a heavily traded stock and if breaks below the 2 dihram level that could impact sentiment for other stocks.

Time to keep an eye on Aldar, even if don't own it right now.

Dubai Property Industry to Remain Under Stress in 2011, CB Richard Says - Bloomberg

Dubai’s real-estate industry will remain under stress with occupancy levels dropping because of “massive new supply,” according to CB Richard Ellis Group Inc.

“Oversupply will remain a fixture for the foreseeable future in both the office and residential sectors but some of the negativity may be offset by forecasts of a significant economic recovery over the next two years,” CB Richard Ellis said in an e-mailed statement today.

Residential apartment lease rates in both freehold and non- freehold areas of Dubai dropped by about 4 percent in the fourth quarter, while they fell 17 percent on a year-on-year basis, CB Richard Ellis said.

gulfnews : High oil to fuel surplus economy

With the price of crude hitting $100 per barrel, Kuwait appears to have no worries on the fiscal front. The same cannot be said, however, of its political firmament.

An estimated 94 per cent of revenues come from oil exports by the Organisation of Petroleum Exporting Countries' fifth-largest producer. The country produced 2.30 million barrels of oil a day on average last year, according to Bloomberg data.

Kuwait's oil revenue ratio is one of the highest among the six Gulf Cooperation Council nations, and is expected to result in a fiscal surplus upwards of $25 billion when the country takes fiscal stock of the financial year on March 31.

gulfnews : Aldar decline sparks concerns

Negative investor sentiment triggered by Aldar Properties' restructuring plans, which will be dilutive to shareholders, continued to weigh on the UAE markets last week. Aldar declined to a 23 month low and broke below previous support of Dh2.20.

Optimism about a market recovery in 2011 has now turned to caution and renewed concerns about debt restructurings, persistent real estate issues, and the availability of financing. Further, sentiment is not helped by problems in Lebanon, Tunisia and Egypt.

FACTBOX - Saudi King Abdullah's reforms | Reuters

Saudi Arabia's King Abdullah, who came to power in 2005 as the sixth ruler of the top oil exporter, started cautious reforms as part of his drive to open up the absolute monarchy and create jobs for its growing population.

Abdullah, believed to be aged about 87, went to the United States in November for medical treatment for a blood clot that complicated a slipped spinal disc.

He arrived in Morocco from New York on Saturday for convalesence, state media said.

Saudi Arabia May Grow 4.5% This Year, NCB, Dun & Bradstreet Say - Bloomberg

Saudi Arabia’s economy, the largest in the Arab world, may grow 4.5 percent this year as strong oil prices, improving business confidence and government stimulus measures boost growth, according to a report by Jeddah-based National Commercial Bank and Dun & Bradstreet South Asia Middle East Ltd.

The non-oil sector may grow 4.6 percent, while oil-sector growth is expected to be 4.3 percent, according to the Saudi Business Optimism Index released jointly today by NCB and Dun & Bradstreet, a provider of business data and statistics.

The economy probably accelerated 3.8 percent last year from 0.6 percent in 2009, according to the latest Finance Ministry data. The kingdom pumped 8.4 million barrels a day of oil in 2010, 4.3 percent above its OPEC quota, as it used more crude to meet growing domestic demand, according to a U.S. government report released Jan. 4.

Business : Drydocks World gets $200m; seeks restructuring

Drydocks World (DDW) seeks to amend the terms of its core syndicated debt facility and also plans to get new long-term working capital facilities in addition to a new $200 million the company announced on Saturday.

The shipbuilding arm of Dubai World is in talks with banks to restructure around $2 billion in debt and a majority of the debt i.e. $1.7 billion is maturing in November 2011, according to top officials of the company.

“Our debts amount to $2 billion, and a partial deal for restructuring is set for this week with the final deal set for April,” Khamis Juma Buamim, Chairman, Drydock World said earlier this month.