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Thursday, 29 September 2011

Dubai's Emirates eyes $1 bln bond - exec to paper | Reuters

Dubai's flagship Emirates airline is planning to issue $1 billion in bonds, a senior official was quoted as saying on Thursday, to counter uncertainty about financing as European banks struggle.

Brian Jeffrey, senior vice president of corporate treasury, told Arabic language daily al-Bayan, that the airline was considering the new bonds to finance aircraft purchases, given funding challenges faced by European banks.

Emirates, which issued a $1 billion bond in June, said diversifying funding options is always on the table.

Australia to overtake Qatar as top LNG supplier | Reuters

Australia may overtake Qatar as the world's biggest producer of liquefied natural gas (LNG) by 2020 as seven vast production plants dotted along its coastline plan to start operating later in the decade, Total's head of LNG Guy Broggi and other experts said at a conference in London this week.

"The new Qatar is Australia because final investment decisions (FIDs) have already been taken," Broggi said, referring to the five sanctioned projects and several more that are expected to reach FID in 2011-2012.

A moratorium on expansion in Qatar until 2015 is further expected to boost Australia's chances of taking the top spot.

Qatar Petroleum Said to Raise $3 Billion in Loans for Barzan - Businessweek

Qatar Petroleum, the Gulf country’s state-run energy company, plans to raise about $3 billion from project financing next quarter to develop its Barzan natural-gas facility, two bankers familiar with the transaction said.

The 16-year loans will pay an interest of between 100 basis points to 150 basis points over benchmark rates besides fees, said the bankers, who declined to be identified because the information is private. Qatar Petroleum sent out request for proposals for the loan to about 50 local and foreign banks and may complete signing documents over the next four to six weeks, the bankers said. One basis point is one hundredth of a percent.

The loans will be followed by a bond offering, with a total fund-raising of $5 billion planned, the bankers said.

Emirates: powering ahead? | beyondbrics –

If Dubai’s emergence as a regional trade hub was founded on its creek, its emergence as a global transportation centre is rooted in its busy airport and fast-growing airline, Emirates.

Boston Consulting Group has issued a report arguing that, at its current rate of expansion, Emirates will become the world’s biggest wide-body carrier by 2015. Its regional competitors, Etihad of Abu Dhabi and Qatar Airways, won’t be far off the top 20. But BCG warns that turbulence will increase as they boost their long-haul operations in an increasingly competitive international market.

Dubai’s ‘Aerotropolis’ strategy – a city flourishing around the busy east-west air corridor it serves – has developed as fast as the city’s debt and real estate woes pulled the emirate back from its hubristic rise over the past decade.

MENA stock markets close - September 29, 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)

Persian Gulf Stocks: Kuwait Finance House and Zain Decline - Businessweek

The DFM General Index fell 0.5 percent to 1,431.711, the lowest since March 8, at the 2 p.m. close in Dubai. The measure retreated 2 percent this week, bringing the decline for the third quarter to 5.6 percent. The Kuwait Stock Exchange Unweighted Index slipped 0.3 percent. Saudi Arabia’s market was closed for the weekend.

The following shares were active in the Persian Gulf region. Stock symbols are in parentheses.

Mobile Telecommunications Co. (ZAIN KK) dropped the most since May 15, losing 3.1 percent to 940 fils. Kingdom Holding Co. and Bahrain Telecom Co. (BATELCO BI) abandoned plans to buy a 25 percent stake of the Kuwaiti phone company’s Saudi Arabian unit. Bahrain Telecom, or Batelco, rose 0.5 percent to 0.4 dinar in Manama trading.

NCB Capital remains positive on Saudi banking sector fundementals | Al Bawaba

NCB Capital, Saudi Arabia’s largest investment bank and leading GCC wealth manager, believes that lower YoY provisions will be a key factor behind strong net income growth for Saudi banks in 3Q11. However, despite the improved asset quality, expanded loan books and strong fee income, top-line growth is expected to remain subdued due to the low interest rate environment. Longer term fundamentals remain good with valuation levels attractive.

Commenting on the new report, Farouk Miah, Acting Head of Equity Research at NCB Capital said, “Saudi banks’ Non Performing Loans (NPLs) declined 13% YoY in 2Q11 and provision coverage increased to 122%. Off the back of better asset quality, we expect provisions in 3Q11 to decline by 52.8% YoY boosting the sector’s 3Q11 earnings.”

NCB Capital expects Saudi banks’ loan books to increase in 2011 on higher public spending which is likely to drive corporate loan books. Retail loans are also expected to remain strong on supportive demographics. Furthermore, the existing low loan-to-deposit ratio, increased low cost deposit base and better asset quality have enabled Saudi banks to grow its lending portfolio. This is likely to keep both retail as well as corporate loan growth healthy in 2011.

Qatar sovereign wealth fund: Europe in biggest crisis in 50 years - The Economic Times

The head of Qatar's $100 billion sovereign wealth fund said Greece's debt crisis was Europe's worst in decades, telling a German newspaper Handelsblatt the outlook precluded making long-term investment decisions.

"Currently, we can only act with a view to the short term, longer term forecasts cannot be maintained in view of the insecure situation in Europe and the United States," Qatar Holding chief executive Ahmad Mohamed Al-Sayed was quoted as saying in an interview.

"This situation dwarfs everything that the continent has seen in the past 50 years ... "It remains to be seen whether all the various states truly decide in favour of a common future."

Al Jaber to agree debt deal by year-end, says COO - Construction -

Abu Dhabi’s Al Jaber Group expects to reach a deal with creditor banks to restructure more than $1bn in debt before the end of the year, the company’s COO said Wednesday.

The privately-held firm set up a banks' committee earlier this year to thrash out a debt deal after it announced talks with lenders to discuss the terms of its facilities.

“We are not restructuring, we are just rescheduling some existing debts,” Fatima Al Jaber told Arabian Business on the sidelines of the Leaders in Construction Summit in Dubai.

Margin trading only for select brokerage firms

The market watchdog Capital Market Authority (CMA) will allow only select brokerage firms to carry out margin trading (or secured trading as it is called), said a top-level official of CMA.

“All brokerage firms will not be allowed to carry out such trading. Brokerage firms are required to get a separate licence for collateral trading (or margin trading) from the CMA. They have to apply for it,” Abdullah bin Salem bin Abdullah al Salmi, executive vice-president of the Capital Market Authority (CMA) told Times of Oman.

Margin trading allows investors to borrow money from a broker to purchase stocks, using their investment as collateral.

Alwaleed-Backed Kingdom, Batelco Abandon Plan to Acquire 25% of Saudi Zain - Bloomberg

Kingdom Holding Co. (KINGDOM), controlled by Saudi billionaire Prince Alwaleed bin Talal, and Bahrain Telecom Co. (BATELCO) abandoned a plan to acquire 25 percent in Zain Saudi Arabia for $950 million.

Kingdom and Bahrain Telecom "concluded that the terms and conditions as set out in its non-binding offer could not be met to its satisfaction,’’ they said in separate statements today. “This follows a period of due diligence and discussions with Zain Group and other stakeholders.”

Kingdom and Bahrain Telecom, known as Batelco, had agreed in principle to pay $950 million in cash for the stake in Zain Saudi, controlled by Kuwait’s Zain Group. In addition, Zain Saudi would have paid $250 million of debt to Zain Group after the transfer of ownership, Zain Group said on March 16.

gulfnews : Cost of doing business in Dubai hurting retail, business group says

The high cost of doing business in Dubai is having a negative effect on the emirate's retail sector, CEOs claimed yesterday.

During a roundtable discussion hosted by the Dubai Chamber of Commerce and Industry, top businessmen in the UAE said that the high cost of hiring staff, paying wages and rents was a significant obstacle.

"Despite Dubai's appealing conditions and promising growth, the high operating costs of businesses is among the emirate's main challenges [and] should be monitored very closely," said Mohideen Bin Hindi, the chairman of the Dubai Retail Business Group.

Consumers: Divergent fortunes leave Dubai at the centre of attention -

If the entire Middle East was slammed by the global financial crisis, its revolutions of 2011 are, perhaps ironically, creating deeper divides between the region’s haves and have-nots – at least in spending power.

States beset by revolutionary fervour are witnessing reduced consumption as their economies falter amid uncertainty – even if, in the longer term, political change could bring deeper, more exciting markets for global retailers.

The divergent fortunes are most apparent in the Middle East and north Africa’s two largest consumer markets, Egypt and Saudi Arabia.

Gulf royalty pretends it is a special case -

Gulf rulers are sending the world an unequivocal message – their countries will remain an exception to the Arab awakening. As the winds of change blow through the Middle East and north Africa, Gulf states are behaving as if it’s business as usual, pursuing small, incremental political reforms that would be deemed irrelevant, if not insulting, in other parts of the region.

In Bahrain, where a Shia uprising was crushed this year, the authorities held a by-election last weekend to replace Shia members who had withdrawn from parliament in protest at the harsh security crackdown. They portrayed the exercise as a confirmation of the al-Khalifa family’s commitment to political reforms.

Next door in the United Arab Emirates another election was held, this one to a federal national council that has a purely advisory role and in which half the members are, in any case, appointed. The election was billed as a step forward because the number of citizens entitled to take part was significantly increased.

Bahrain set to spend its way out of unrest -

Bahrain has started to receive funds from the six-member Gulf Cooperation Council as it seeks to spend its way out of a slowdown caused by political unrest which is blighting its services-orientated economy.

Sheikh Mohammed bin Essa Al Khalifa, chief executive of the Economic Development Board, says “a significant portion of the GCC funds” have arrived in the past few weeks, referring to the first elements of a $1bn tranche expected this year.

“We are spending on infrastructure, a lot on housing. We are looking at private public partnerships. There are a number of initiatives in the pipeline aimed at encouraging economic growth through social improvement,” he says.

Dubai to offer rupee options -

Dubai’s gold and commodities exchange is extending its Indian rupee trading contracts by offering investors a platform to trade options contracts for the first time outside India to meet growing demand for currency-denominated derivatives.

Options contracts grant investors the right to buy or sell at a fixed price within a defined period or on a predetermined date.

They are used to offset the risk of currency fluctuations. Investors can also make speculative bets using the contracts or explore arbitrage opportunities to benefit from different exchange rates.

Middle East retail, top retail locations, Abu Dhabi Mall, Seef Mall, Raya Mall, Landmark Doha | alifarabia

Middle East retail rents staganted in the 2010/11 period which ended in June, according to research consultants Cushman & Wakefield (C&W).

This downward trend was in sharp contrast to the growth seen in other emerging markets. Not surprisngly, some of the countries most affected by the Arab revolt saw the most severe declines. Bahrain’s retail rents fell 26.7% during the period, while Syria saw a 16.7% decline.

Meanwhile, UAE (3.0%) and Qatar (2.2%) registered more modest falls. Rental uplift was confined to Lebanon (5.2%) – where values in the top shopping areas of Beirut proved resilient to external factors.