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Wednesday, 8 February 2012

GCC Mutual Fund Industry Survey 2011: Assets under management at top GCC companies decline -

GCC Mutual Fund Industry Survey 2011 was sponsored by Qatar Financial Centre Authority, PwC, Emirates NBD, Al Imtiaz Investment Company, and National Bank of Abu Dhabi.

Shashank Srivastava, Acting CEO of the Qatar Financial Centre Authority, said, “The QFCA is delighted to be a sponsor once again of this latest GCC Mutual Fund Industry Survey. It is an invaluable and comprehensive source of current opinion and information on the mutual fund industry in our region and demonstrates the significant development potential of the industry here for all market participants.

"We at the QFCA are strongly supporting this development and, in particular, the growth of Qatar and the QFC as a regional hub for asset management, offering firms one of the most business friendly tax environments, a legal system based on English common law, efficient administration and a robust regulatory regime.”

MENA stock markets close - February 8, 2012

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)

Comprehensive reference material about Shariah scholars released, as Islamic Finance industry assets top US$1 trillion-

The 2012 version of the report is the world's first comprehensive report on Shariah scholars, with detailed profiles of more than 120 of the top scholars in the Middle East and from around the globe highlighting Islamic Finance’s global reach.

“Spanning from East to West, The Shariah Report profiles Shariah Scholars from Asia, the Middle East, Africa, Europe & North America, providing insight into the depth and breadth of the industry”, added Anne-Sophie Gintzburger, Founding Director at Grapes.

Each scholarly profile comprises country of birth, academic qualifications, a cross-referenced list of institution where each scholar serves as a Shariah Board member, and a list of their important works on Islamic finance.

STOCKS NEWS MIDEAST-Emaar at 6-mth high, Dubai extends rally - Yahoo!

Emaar Properties climbs to a six-month high, lifting Dubai's index, as investors bet on good fourth-quarter earnings for the developer.
Emaar gains 3.2 percent, ending at its highest close since
August 4. The company will report its 2011 earnings in the next few days. Analysts polled by Reuters on average expect Emaar to post a 74 percent increase in fourth-quarter profit.
"Good numbers are expected from Emaar and investors are also hoping for good dividends," says Nadi Bargouti, head of asset management at SHUAA Asset Management.

FT Alphaville » Natural gas outrage of the day

The natural gas market has always behaved a little oddly.

First, it’s always been hugely seasonal, thus responsible for many a widow-maker trade. But now investors and traders have to contend with the impact of fracking too, a process which has by and large upped production to such a degree that prices have been knocked well and hard (à la the Baltic Dry Index):

Qatar's QEWC buys stake in Jordanian power plant | Reuters

Qatar Electricity & Water Co (QEWC) has agreed to buy a 23.3 percent stake in Jordan's Amman East power plant from a Bahraini infrastructure fund, in a move by the state-owned Qatari firm to expand its international footprint.

QEWC bought the stake from IDB Infrastructure Fund, a $730 million private equity fund established in 2001 and managed by EMP Bahrain, a subsidiary of EMP Global. The IDB Fund's mandate is to make investments in infrastructure projects in Islamic countries.

As part of the deal, QEWC will buy IDB's 38.9 percent interest in AES Oasis Ltd, the 60 percent owner of the holding company for AES Jordan, QEWC said in a statement.

UAE jeweller Damas hires Nomura for deal-sources | Reuters

UAE jeweller Damas International has appointed Japan's Nomura to advise it on a potential offer from Qatari conglomerate Mannai Corp, three sources familiar with the matter said on Wednesday.

Mannai, whose operations span the oil and gas, automotive, travel and logistics sectors, last month said it had secured commitments from shareholders, including the key Abdullah brothers, to buy 58.8 percent of Damas at 45 U.S. cents a share.

At that price, an offer would value Damas at around $445 million, according to Reuters data. The stock, trading at 36 cents on Wednesday, has surged since the news of deal talk on Jan. 4, gaining 63 percent year-to-date.

Iran Anxiety No Match for Central Bankers Sedating Investors - Businessweek

Iran’s nuclear ambitions, Syria’s bloody crackdown and Greece’s potential default are leaving markets unfazed as central bankers take unprecedented steps to prevent the global economy from crumbling.

The VIX, a measure of equity volatility known as the “fear index,” fell to 17.1 on Feb. 3, the lowest level since July, according to the Chicago Board Options Exchange. The Bank of America Merrill Lynch MOVE index, which measures swings in bond prices, closed at 72.3 on Feb. 6, about the least since July 2007. JPMorgan Chase & Co.’s index of implied volatility on currencies dropped to 10.2 on Jan. 23, its lowest since March.

While geo-political risks have risen, investors are taking their cue from policy makers from Washington to Frankfurt to Beijing who are driving down interest rates and flooding the world with cash to prop up their economies. The balance sheets of the world’s six biggest central banks have more than doubled since 2006 to $13.2 trillion, according to Chicago-based Bianco Research LLC.

UPDATE 1-Bahrain's Batelco sells India venture after telecom scandal | Reuters

Bahrain Telecommunications Co (Batelco) has agreed to sell its 43 percent stake in Indian affiliate S Tel for $175 million, in the first foreign exit since India scrapped 122 telecoms licences last week as part of a corruption probe.

Batelco will sell the stake to India partner Sky City Foundation Limited and will receive the same price it paid to acquire its holding in S Tel in 2009, the Bahraini operator said on Wednesday.

On Feb. 2, India's judiciary scrapped 122 licences held by eight operators amid a 2G telecoms scandal.

Kuwait Commercial Bank Plans to Book Provisions for Most of 2012 - Bloomberg

Commercial Bank of Kuwait SAK plans to continue booking provisions in the first three quarters of 2012 as the process of “cleaning up balance sheets” takes longer than expected, the acting chief executive officer said.
Regional and international “economic situations didn’t look that bad a year ago,” Elham Mahfouz said in a phone interview in Kuwait City yesterday, citing popular unrests in the Middle East and North Africa region and the debt crisis in Europe. The bank set aside 101.3 million dinars ($366 million) as provisions against loans and investment portfolios.
Lending is expected to grow by less than 5 percent this year and the bank foresees a “slight” increase in profit, Mahfouz said. Profit plunged to 810,000 dinars last year from 40.5 million dinars in 2010, the bank said on Feb. 5.

Bahrain's Batelco studying SC ruling, mulls legal option

Bahrain's telecom operator Batelco has said it is carefully studying the detailed judgement by the Supreme Court of India on February 3, in conjunction with STel Management, other STel shareholders and legal advisers.

The Supreme Court cancelled all 122 2G licences issued in 2008 to eight operators, including STel. Batelco invested in STel following a diligence exercise with the support of financial and commercial advisers, a company statement said.

It also received certain representations and warranties from STel's promoter regarding the validity of the licence.

Saudi Arabia’s Sabic in Talks on Trinidad Methanol Venture - Bloomberg

Saudi Basic Industries Corp., the world’s largest petrochemicals producer, is in talks over a potential methanol plant venture in Trinidad and Tobago, according to Chief Financial Officer Mutlaq al-Morished.
Talks are being conducted under a confidentiality agreement, al-Morished said today at a conference in Dubai, without giving any further details.
The majority government-owned company known as Sabic, which produces methanol in Saudi Arabia, is expanding to meet rising demand for petrochemical products in growing economies including China and India.

Drydocks denies selling Southeast Asia assets -

Drydocks World LLC, the company controlled by Dubai World, has no plans to sell its assets in Southeast Asia and is looking for partnerships that will help bring its business there to profitability by next year, Albayan newspaper reported, citing Chairman Khamis Juma Buamim.

The chairman denied a report yesterday by Dow Jones, which said the company was considering the sale of its Southeast Asian ship-building and repair operations as part of a restructuring of US$2.2 billion of debt, citing unidentified bankers.

Drydocks in Southeast Asia has taken steps toward entering “strategic partnerships” with local and international companies, Buamim told the newspaper.

Kuwait Will Sign $2 Billion of Oil Contracts, Al-Rai Reports - Bloomberg

Kuwait plans to sign contracts worth a total of $2 billion to sell oil to Germany, Austria, South Africa and South America, Al-Rai newspaper reported, citing Nasser al-Mudhaf, who heads international marketing at Kuwait Petroleum Corp., the country’s national oil company.
The contracts, to be signed toward the end of this month, will involve selling as much as 50,000 barrels of oil a day in the first year, the newspaper said.

UAE's Dolphin Energy raises $1 bln from 10-yr bond sale | Reuters

Abu Dhabi's Dolphin Energy, majority-owned by state fund Mubadala, raised $1 billion from a 10-year bond sale on Tuesday, mainly to meet its refinancing needs.

The bond, which has been privately placed, was priced at 5.5 percent, at the tighter end of revised guidance of 5.5 percent to 5.65 percent.

Initial guidance was given in the 5.75 percent area.

Seat sale as Emirates expands aggressively for market share « ArabianMoney

Emirates Airline is slashing up to 30 per cent off the cost of its flights in a three-day seat sale that started yesterday. The carrier is adding routes all over the world this year and takes delivery of an A380 superjumbo every month.

Grabbing market share in the teeth of a global economic slowdown is not going to be easy, especially for the legacy airlines whose fleets operate at higher cost levels. A380 aircraft cost around 20 per cent less to fly per passenger and are often full because they offer a superior flight experience.

gulfnews : Unemployment among youth a ticking bomb

Unemployment is a ticking bomb that helped fuel the recent political turmoil in the Middle East — otherwise known as the Arab Spring — that toppled a number of regimes last year. However, a year after the turmoil, the youth unemployment rate in the region remains at 26.2 per cent — one of the highest in the world.
A society cannot move forward keeping more than a quarter of its young workforce out of jobs. The governments in Middle Eastern countries, including those in transition after the Arab Spring, should work closely with the private sector to unlock econ-omic potential and help attract investment that will create jobs.
The Middle East has been blessed with vast natural resources and human talent. It is the birthplace of some of the richest civilisations. It has given the world algebra, chemistry and simple solutions to complex mathematical problems.

gulfnews : India, Iran seal oil payment mechanism

Ruling out gold as a mode of payment, Iran yesterday said Indian companies will pay for 45 per cent of their oil imports from Iran in the Indian currency as part of a mechanism agreed between the two countries.
"Both sides are satisfied," Syed Mahdi Nabizadeh, Iran's ambassador to India, told reporters here.
"Gold is not suitable," he replied when asked whether Iran will accept the yellow metal from India as part of payment for Iranian oil as was speculated earlier. Iran could also increase its imports from India to settle part of the payments, he said. With the US and the EU imposing fresh sanctions on Iran, India has been exploring various ways to pay for Iranian oil.

gulfnews : Credit profiles to be ready in six months

Credit profiles for individuals and companies will be made available to creditors within six months, the Federal National Council was told on Tuesday.
Obaid Humaid Al Tayer, Minister of State for Financial Affairs, provided an update on the Dh200 million project after FNC members' concerns about a lack of credit information in the banking sector.
"[It will] be launched in less than six months and it will be liable for organising, collecting, keeping and classifying credit information," he said.

UB40's melody of Thatcher's broken Britain could haunt UAE - The National

Growing up in the UK during the 1970s and 80s the hallmarks of a society wracked by unemployment were plain to see.

Dole queues on the news, cardboard cities of homeless youth, rising crime and urban decay were all the norm.

Even the songs on the radio reminded you that the prospects of finding a job were pretty slim. The reggae band UB40 took its name from the form you had to fill in to claim unemployment benefit while their hit One In Ten referred to the unprecedented unemployment rate at the time.

In Al Gosaibi saga, a punchline with the joke on creditors - The National

Eric Lewis can tell a good gag. A partner with the New York firm Lewis Baach, he knows it's all about timing.

Mr Lewis has been working for the Al Gosaibi family of Saudi Arabia ever since their world collapsed in a maelstrom of fraud allegations, international legal actions and billions of dollars worth of debt in May 2009.

The family, one of the kingdom's most venerable merchant dynasties, pointed the finger at (now) estranged family member Maan Al Sanea, whom they accused of stealing the family fortune and running up the mind-boggling debts.

UAE managers spy opportunities for growth - The National

More than one third of businesses in the Middle East are planning to expand this year as companies show signs of recovery from the effects of the global financial crisis.

A poll of 600 businesses conducted by Hay Group, a management consultancy, showed that managers of regional firms were rethinking the virtues of being cautious as the world economy gets back on track.

"Following two years of cautious business plans, organisations are now looking to invest their profit and according to 36 per cent of respondents the main business priority for 2012 is expansion," the report said.

Arabs Seek Safety in Dollars as Euphoria Fades - Bloomberg

As he watched Egypt’s revolt turn into a financial crisis that devoured 50 percent of the nation’s foreign-currency holdings last year, Ahmed El-Rifai started charging some clients in U.S. dollars.
The 32-year-old owner of Egyweb, a Web-development company in Cairo, says he may also buy real estate with his Egyptian pound savings, concerned that the loss of reserves will lead to a devaluation. That has already sent the pound down 3.8 percent since the start of last year. Iraq’s central bank says its dollars are fuelling Syria’s black market. In Tripoli, Libya, dozens are queuing every morning at banks to buy the U.S. currency.
A year after popular protests from Tunisia to Egypt to Libya toppled rulers, transitions marked by violence have failed to lift economic hardship. Almost two thirds of Egyptians see the economy as the country’s biggest challenge, according to a survey by the New York-based International Peace Institute in September. Promised Western aid has yet to arrive, savings in foreign currencies have grown and government borrowing costs have surged.

UPDATE 1-S.Korea says Saudi Arabia ready to consider additional crude supplies | Energy & Oil | Reuters

South Korea's presidential office said in a statement on Wednesday that Saudi Arabia would "actively consider" support including additional crude supplies if requested by Seoul, as it looks for alternatives to Iranian oil.

The remarks came in a meeting between Saudi Arabia Oil Minister Ali al-Naimi and South Korean President Lee Myung-bak.

"President Lee requested stable crude supply to South Korea in the event of an emergency, and Minister Naimi responded that Saudi Arabia would actively consider support including additional supply if South Korea requests," the statement said.

Exclusive: China buys up Saudi, Russian oil to squeeze Iran | Reuters

China is scouring the world for alternative oil supplies to replace a fall in its imports from Iran, as it seeks to negotiate lower prices from Tehran, and has been drawing heavily on Saudi Arabia.

Industry sources told Reuters that Beijing had bought the bulk of an increase in crude oil supplies from top oil exporter Saudi Arabia in the last few months.

The world's second-largest oil consumer is also importing more cargoes from West Africa, Russia and Australia to replace reduced supplies from Iran.

Gulf Times – Qatar calls for unified plan on Arab capital markets

Qatar has called for a unified strategy for the Arab capital markets to protect them from uncertainty and maintain confidence in the securities system.
“A co-ordinated and unified efforts of the member authorities are the only way that will help developing a unified strategy for the Arab capital markets,” Qatar Central Bank Governor HE Sheikh Abdullah bin Saud al-Thani told the 6th meeting of Union of Arab Securities Authorities (UASA), hosted by the Qatar Financial Market Authority (QFMA).
Only through co-operation and co-ordination can an economy survive or escape recession, he said, adding that the development of information dissemination and exchange systems between members of the UASA is among the top priorities.

U.A.E. Banks Dip Back Into Real Estate -

Banks in the United Arab Emirates are tiptoeing back into real-estate lending.

As the region's economy improves and some sections of the real-estate market show signs of stability and growth, banks are cautiously beginning to lend again. But they are imposing more stringent conditions than before.

"The general market sentiment on real estate is more positive now than it was 12 months ago," said John Chang, head of retail banking at Dubai-based lender Noor Islamic Bank. "Bank liquidity is growing as the interbank lending rate is coming down, and in general banks now have higher capital-adequacy ratios than those required by the central bank."

UAE sees drop in Jan oil output

The UAE produced 2.52 million barrels per day (bpd) of oil in January, down slightly from 2.6 million in December, an industry source familiar with the matter said.

'Demand still remains strong from Asia which kept production almost steady in January,' the source told Reuters on Monday. The production is expected to pick up to 2.6 million bpd again in February, he added.

Traders have so far not identified any new orders from European countries from the UAE, as the West prepares to ban Iranian crude imports.

Occidental Petroleum Corporation : UPDATE : UAE's Dolphin Energy Sees Good Demand For 10-Year Bond | 4-Traders

Abu Dhabi-based Dolphin Energy, a regional gas production and pipeline company, received strong demand for a new 10-year bond on Tuesday, the first benchmark-size conventional issue this year from a Gulf Arab company, two bankers familiar with the deal said.

The initial price talk for the bond had it yielding 5.75%, though one of the bankers said there's a "strong possibility" the price will tighten as a result of high demand for the debt. Dolphin aims to raise up to $1 billion with the issue.

The bond sale comes as global risk appetite has improved, despite the continuing crisis in the euro zone, triggering large rallies in the U.S. and other equity markets.

Drydocks World Considers Major Restructuring, Possible Sale of Southeast Asian Operations | gCaptain - Maritime & Offshore

Drydocks World, Dubai’s shipyard arm, is considering the sale of its entire Southeast Asian ship-building and repair operations in an effort to advance the restructuring of $2.2 billion of the company’s debt, three bankers familiar with the situation said.

The bankers said that auditors have conducted an analysis of the Asian assets and are currently reviewing a wide range of candidates interested in purchasing some or all of the operations. They said that Drydocks is preparing to draw up a shortlist of potential bidders, which include ship repair and ship building specialists.

“The company is pursuing a sale of the Southeast Asian business, there are plenty of candidates that have expressed an interest,” said one of the bankers familiar with the talks. Drydock’s Asian operations consist of four shipyards in Singapore and Indonesia, specializing in rig building, shipbuilding, repair and conversion.

Abu Dhabi Investment Authority names European real estate chief - Pensions & Investments

Pascal Duhamel was appointed as Abu Dhabi Investment Authority's head of European real estate investments, according to spokesman Erik Portanger.

The position is new. Based in Abu Dhabi, Mr. Duhamel will report to Bill Schwab, global head of real estate at ADIA.

While ADIA does not provide data on its total assets, the Sovereign Wealth Fund Institute estimates that the fund has about $627 billion in assets. The target allocation to real estate is 5% to 10% of the overall portfolio.

Analysis: Maplecroft Misses Mark in Assessment - Arabianomics

The founder of the risk-assessment consulting firm Maplecroft said today at a conference in Dubai that Saudi Arabia was the country that has the most uncertain political environment of 15 nations examined by the firm.

A Saudi Flag is Waived During Egyptian Protests
Alyson Warhurst, the founder of Maplecroft, said that Saudi Arabia “faces three issues,” according to Bloomberg. “An educated and disgruntled youth buoyed by the success of the Arab Spring elsewhere, water and energy security, and general issues of oppression and the lack of political freedom.”

Saudi Arabia has social, economic and political challenges in the years and decades ahead, but considering the progress Saudi has made on these fronts in the last decade alone, the more immediate threats faced by some of the other 14 countries examined, and the forthcoming changes on the horizon for the Kingdom, the assessment appears misguided.

Libya sees pre-war oil production in summer | Reuters

Libya anticipates a return to pre-war oil output of 1.6 million barrels per day (bpd) in June or July this year, Deputy Oil Minister Omar Shakmak said on Tuesday.

Oil companies were currently producing at between 60 and 90 percent of their normal output, he told Reuters in an interview.

"In general, if you look at the oil companies, they are all between 60 and 90 percent of the normal production for each company," Shakmak said.