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Thursday, 15 September 2011

Dubai Electricity Spreads Widen on Slump Concerns: Arab Credit - Bloomberg

Investors in Dubai Electricity & Water Authority’s bonds are demanding close to the highest premium in six months to hold the utility’s debt over that of Abu Dhabi National Energy Co. (TAQA) as they seek safer assets.

The spread between bonds of DEWA, as Dubai’s government- owned utility is known, and those of the neighboring Abu Dhabi utility, known as Taqa, widened to 281 today from this year’s low of 199 basis points on July 20. The yield on DEWA’s 8.5 percent bond maturing in April 2015 rose 61 basis points to 5.44 percent in the same period and Taqa’s 4.75 percent securities due September 2014 fell 22 basis points to 2.64 percent, according to data compiled by Bloomberg.

Dubai’s government and state-linked bonds are suffering on concern a renewed global economic slump may hurt the ability of the United Arab Emirates second-largest sheikhdom to repay more than $100 billion in debt. Business confidence in the country slipped to a 15-month low in August, HSBC Holdings Plc said in its monthly Purchasing Managers Index survey Sept. 7.

Kuwait's Global seeks new debt deal from creditors | Alrroya

Kuwait's Global Investment House asked creditors to delay principal repayments on debt due in December, it said on Thursday, as part of a move to renegotiate a $1.7 billion restructuring agreement.

The investment firm also asked to defer an increase in the rate of interest, starting in December, and waive or defer certain covenants applicable to Global under its debt arrangements, according to a statement from the firm.

Evercore Partners, a private investment bank, has been appointed by Global to advise it in the restructuring process, a source with knowledge of the move said on condition of anonymity.

MENA stock markets close - September 15, 2011

ExchangeStatus IndexChange
TASI (Saudi Stock Market)
DFM (Dubai Financial Market)
ADX (Abudhabi Securities Exchange)
KSE (Kuwait Stock Exchange)
BSE (Bahrain Stock Exchange)
MSM (Muscat Securities Market)
QE (Qatar Exchange)
LSE (Beirut Stock Exchange)
EGX 30 (Egypt Exchange)
ASE (Amman Stock Exchange)
TUNINDEX (Tunisia Stock Exchange)
CB (Casablanca Stock Exchange)
PSE (Palestine Securities Exchange)

gulfnews : Qatar expects effect of debt crisis on Gulf to be brief

Qatar is confident it can keep inflationary pressures contained while maintaining its longstanding currency peg to the US dollar despite the greenback's recent weakness, according to Abdullah Saud Al Thani, Doha's central bank governor.

Any impact on the Gulf economies from the sovereign-debt crisis in Europe and US economic difficulties would be "short-term," Al Thani said in an emailed response to questions from Zawya Dow Jones.

The Qatar Central Bank's monetary policy "is foc-used on managing the short-term interbank interest rates with a view to sustaining the peg," Al Thani said. "This policy framework has served us well and appears to be relevant, even under current circumstances."

gulfnews : Rise in salaries is a double-edged sword

The decision to increase salaries of Qatari citizens by 60 per cent for civil employees and 120 per cent for military personnel is the latest episode in a series of pay increases in Gulf Cooperation Council (GCC) countries. It is a positive move which has led to improved living standards and minimised the effects of inflation.

Wage and salary policies are one of the most important economic instruments a government has at its disposal, and have a direct and significant impact on living conditions.

As a result, wage and salary policies should be given great consideration.

gulfnews : Arcapita posts profit on multiple exits

Bahrain-based investment firm Arcapita swung to a profit in its fiscal year ended June 30, it said yesterday, helped mainly by multiple exits or disposals of assets in its investment portfolio. The Islamic investment firm recorded net income of $50.2 million (Dh184.3 million) compared with a loss of $560 million for the year before. Arcapita said it completed seven full and partial exits during the year, returning about $1 billion to the firm and its shareholders. The company was badly hit by the crisis as it struggled to exit its investments due to global investment woes and its fee income from raising fresh funds in the Gulf Arab region collapsed. Arcapita, whose total assets stood at $3.7 billion on June 30, raised $435 million from its investment in property firm Mapletree Industrial Trust last year and sold a portfolio of senior living communities in the United States for $630 million in early 2011.

gulfnews : Palestine plans first sukuk sale

The central bank of the Palestinian Authority, whose leaders plan to seek statehood at the United Nations this month, may sell its first Islamic bonds in December to bolster an economy sustained by foreign aid.

"It's essential for our monetary policy that the government issues bonds or securities and develops a yield curve," Jihad Al Wazir, governor of the Palestine Monetary Authority, said in an interview in Ramallah on Monday. "Sukuk is a security but there is an underlying asset. This makes the banks a little more comfortable."

Economic growth in the West Bank and Gaza Strip is slowing, prompting the International Monetary Fund to revise its 2011 forecast to 7 per cent from 9 per cent, according to the World Bank.

Office rents falling in DIFC strata buildings - The National

CB Richard Ellis reports office rents for so-called "strata" buildings in the Dubai International Financial Centre are down 30 per cent in the past year, which is troubling news for developers such as Union Properties.

The DIFC is one of Dubai's prime office markets, attracting global financial companies. Goldman Sachs, Barclays Capital and Citibank have leased substantial amounts of space in DIFC this year.

The vacancy rate in buildings not controlled by the Government in the DIFC is about 20 per cent, compared with about 45 per cent for Dubai in general, according to Matthew Green, CBRE's head of consultancy.

Doubt hangs over tribunal for Nakheel legal cases - The National

The fate of millions of dirhams worth of claims involving Nakheel in the Dubai World Tribunal are in limbo after the company's separation from Dubai World.

The tribunal was established in 2009 to handle claims relating to Dubai World and its subsidiaries, including Nakheel, the developer behind Palm Jumeirah and The World, the collection of man-made islands.

But last month Nakheel formally severed ties with Dubai World when it completed a US$16 billion (Dh58.76bn) financial restructuring, leaving the legal community doubtful about the role of the tribunal in Nakheel disputes.

Egypt Plans to Raise $2.6 Billion Selling T-Bills, Bonds During Next Week - Bloomberg

Egypt plans to raise 15.5 billion Egyptian pounds ($2.6 billion) over the next week at auctions of government debt, the largest amount this quarter.

The Arab country’s central bank will seek bids for 2.5 billion pounds in six-month notes and 3.5 billion pounds of one- year securities tomorrow, according to Central Bank of Egypt data on Bloomberg. It plans sales of three-month and nine-month bills on Sept. 18 valued at 2 billion pounds and 3.5 billion pounds, respectively, according to the data.

The lender said earlier this week it will offer a combined 4 billion pounds in two-year and three-year fixed-rate bonds on Sept. 19.

Qatar Shows Faith in Europe -

The decision in late August by Qatari investors to inject €500 million into the creation of Eurobank EFG in Greece was the most recent in a string of investments in euro zone assets by the Gulf state this year.

The investment, worth the equivalent of $685 million, in the merger of the troubled Greek banks Alpha Bank and Eurobank — creating the largest bank in Southeast Europe in terms of market capitalization — was in addition to a 7 percent stake the Qatar Investment Authority already held in Alpha Bank.

“Qatar already has sizable commitments in Europe, and part of their strategy involves politics and part of it involves escalation of commitment, particularly in what they believe are bargains,” said Yazan Abdeen, a fund manager at ING Investment Management in Dubai.