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Monday, 20 February 2012

Bahrain counts the cost of year of unrest - FT.com

In the early evening rush-hour, the market in central Manama, Bahrain’s capital, was busy with bargain hunters. Bankers were making their way home; women in tight skirts were on their way to work at the district’s nightclubs.
Suddenly, volleys of tear gas canisters rained down the avenue, aimed at youths shouting anti-government slogans. Some bounced off the hotel hoardings as shoppers scattered for cover.

MENA stock markets close - February 20, 2012

ExchangeStatus IndexChange
TASI (Saudi Stock Market)
6904.380.50%
DFM (Dubai Financial Market)
1568.94-0.14%
ADX (Abudhabi Securities Exchange)
2504.170.61%
KSE (Kuwait Stock Exchange)
6114.70.51%
BSE (Bahrain Stock Exchange)
1149.620.19%
MSM (Muscat Securities Market)
5675.90.11%
QE (Qatar Exchange)
8650.360.32%
LSE (Beirut Stock Exchange)
1187.590.36%
EGX 30 (Egypt Exchange)
5152.640.77%
ASE (Amman Stock Exchange)
1953.99-0.14%
TUNINDEX (Tunisia Stock Exchange)
4681.83-0.13%
CB (Casablanca Stock Exchange)
11404.70.07%
PSE (Palestine Securities Exchange)
480.120.07%

Chart of the week: oil dependency | beyondbrics – FT.com

The price of Brent crude oil hit an eight-month high last week, and is currently trading at more than $120 per barrel as fears escalated that Iran, the world’s third-largest oil exporter, could cut its exports to the European Union.

How much do emerging markets depend on oil for their energy – and who wins and who loses from high oil prices? Chart of the week investigates.




Bahrain's financial system ' Resilient ' | Al Bawaba

Bahrain's financial system remains resilient, liquid and strong despite the recent unrest. That is the view of new Standard Chartered Bank Bahrain chief executive Hassan Jarrar.

"I was watching the situation from the UAE and we kept a close eye on outflows and was surprised just how minimal they were," he said. "We thought there would be an outflow of capital but the needle did not move. "This is a reflection of where Bahrain stands in the Middle East. It has the best regulatory system in the region and an amazing level of unspoken confidence and we need to remind people of its success.

"The rest of the region and further afield can learn from how Bahrain's financial system stood up to its problem. People should give Bahrain some credit. It has a 100 years of banking history and that has not changed. The black clouds will go away. Bahrain may be less flash than some places - but it has more substance." He was speaking at a media forum organised by the Bahrain Association of Banks (BAB).

OilMin orders probe into Petronet LNG's Qatar contract - The Economic Times

Oil Minister S Jaipal Reddy has ordered a probe into changes made in a multi-billion dollar contract for import of liquefied natural gas (LNG) from Qatar, following allegations of foul play.

Reddy asked Oil Secretary G C Chaturvedi, who is also the chairman of Petronet LNG, to probe allegations that the company quietly switched to buying lean gas, which can only be used as fuel, instead of rich gas that can also produce petrochemicals and cooking gas (LPG), ministry sources said.

Petronet insiders, however, said the allegations were not true as the company was getting about 6.5 million tons out of the contracted volume of 7.5 million tons a year as rich gas from RasGas of Qatar.

Abraaj buys Aureos: but for how much? | beyondbrics | News and views on emerging markets from the Financial Times – FT.com

You can know a lot about a deal and still not know what really matters.

Abraaj Capital, the biggest private equity investor in the Middle East, proudly announced on Monday that it was planning to buy Aureos Capital, the London-based emerging markets specialist PE investor.

But both sides declined to give financial details for the acquisition. This is a pity since the transaction could raise eyebrows in British political circles. UK taxpayers, who used to own Aureos, have every reason to be interested in the sale price.

UAE's Abraaj says no debt raised for Aureos deal - Yahoo!

Abraaj Capital, the Dubai-based private equity firm which announced plans on Monday to acquire Aureos Capital, said it did not raise debt to fund the transaction.
"We're using Abraaj's balance sheet for this deal," Mustafa Abdel-Wadood, Abraaj's chief executive, told reporters after announcing the deal. The company did not give financial details.
Abraaj expects the acquisition of the emerging market private equity fund, which is based in the United Kingdom and has about $1.3 billion assets under management, to close during this quarter.

CPI Financial | News | Is Travelodge edging towards bankruptcy?

Dow Jones is reporting that Travelodge (which was bought by Dubai International Capital) is close to falling into the hands of its creditors as the hotel chain struggles to sort out its huge debt pile. The newswire reports that the debt pile is over GBP 400 million ($634 million) and that current negotiations focus on a GBP60 million medium-term loan facility that requires refinancing immediately.
However, the hotel chain has denied that it is filing for bankruptcy.
“All the lenders are working together to find a sensible solution to the debt structure,” James Leviton, a spokesman for Travelodge, told Bloomberg. “Travelodge is not going into administration.” The hotel chain issued the denial after the Sunday Times newspaper in the UK reported that the chain was weeks away from going under.

Dubai-owned Travelodge secures £60 million line of funding - The National

Budget hotelier Travelodge has secured a £60 million line of funding and is trading well, a spokesman for the Dubai International Capital-owned business said.

He said the £60m pounds medium term loan facility, which replaces an existing line, has been underwritten by junior lenders including US firms Golden Tree Asset Management and Avenue Capital.

Travelodge was currently assessing if senior lenders, such as Investec, Barclays and Royal Bank of Scotland, also want to participate. Debt restructuring talks began earlier this year.

Dubai Benchmark Index Gains 21% From Low in January; Entering Bull Market - Bloomberg

Dubai stocks rose to their highest level from a low in January, entering a so-called bull market.
The Dubai Financial Market General Index rose 0.4 percent to 1578.41 at 10:19 a.m. in Dubai. The gauge is up 21 percent from its low on Jan. 16.
A 20 percent rally or more from lows is generally defined as a bull-market rally.

Dubai's Emirates NBD to hold off on Swiss franc bond - sources | Reuters

Emirates NBD (ENBD), Dubai's largest bank by market value, has opted to delay a potential Swiss franc-denominated bond sale until more favourable market conditions, two sources familiar with the matter said.

The lender had appointed Credit Suisse and BNP Paribas to assess a potential Swiss bond sale, sources told Reuters last week.

"The bank has decided against it," one ENBD source said, speaking on condition of anonymity. "The timing is not right," the source said, adding the lender could tap the market at a later stage.

WAM | TECOM Investments and Emirates REIT announce strategic partnership

TECOM Investments, a diversified conglomerate and a member of Dubai Holding, today announced it has entered into a strategic partnership with Emirates REIT, Dubai's first real-estate investment trust.

Emirates REIT was established in November 2010 to offer investors a strategic market entry opportunity, as well as the professional management of held assets and a promise of long-term returns.

Under the partnership valued at AED170 million, TECOM will obtain a 25 per cent share in Emirates REIT in addition to liquidity for pursuing new development opportunities.

gulfnews : Gulf to see rise in capital inflows

In mid-January, global rating agency Standard & Poor's (S&P) downgraded nine European sovereigns.
The rating agency justified its decision by pointing to a combination of economic and financial factors along with ‘insufficient' measures taken by European leaders in dealing with the crisis.
Jean-Michel Six, Standard & Poor's Chief European Economist, recently spoke to Gulf News on the outlook for European economies and how the debt crisis is impacting the Gulf economies which are also facing heightened geopolitical risks.

Boutique banks learn to adapt to a much leaner, meaner age - The National

The Rivoli store in Dubai's financial free zone was once where investment bankers splashed their cash.

Business was brisk for everything from Dh30,000 (US$8,170) Omega watches to Dh100,000 Vertu phones.

"They would place their orders before their bonuses came through," recalls the store manager, Ismail Askari, standing in front of a cabinet displaying a Dh13,000 Montblanc special Mahatma Gandhi edition pen. "Now there are not so many of them," adds the five-year veteran of the store.

Hints of Saudi opening cause a buzz - The National

For the time being, Saudi Arabia's stock market remains almost entirely closed to international investors.

However, that has done little to prevent banks from hiring staff and redrawing their strategies in anticipation of the kingdom easing restrictions on access to its capital markets, the largest in the Middle East.

With a degree of giddiness, some banks have speculated publicly that the long-awaited opening could happen as early as next month.

Shuaa looks to turn tide - The National

Shuaa Capital was once known as the UAE's biggest investment bank, but it has been four years since it turned an annual profit. In that time it has accumulated losses of almost Dh2 billion (US$544.4 million) - or about twice as much as it made in the previous four years.

The travails of the company, which generated just Dh6.8m of revenue from its investment banking operation last year, chronicles the Catch-22 of the regional industry, whose fortunes have been so closely tied to the ebb and flow of local stock markets - which have offered more ebb than flow for the past three years.

Shuaa hopes to turn its ailing business around by focusing on areas where it believes it has a market advantage - asset management, corporate advisory, small and medium enterprise finance and institutional brokerage.

Industries Qatar see 44.8 percent jump in 2011 profits - Energy - ArabianBusiness.com

Manufacturing giant Industries Qatar recorded a 44.8 percent rise in profits for 2011, aided by resilient profit margins across all production categories.
The petrochemicals and metals company announced a net profit of QR7.9bn ($2.1bn) for the year ending December 31, up from QR5.4bn ($1.4bn) in 2010.
Revenues for the 12 month period were QR16.5bn, an increase of 34 percent compared with the previous year, boosted by improved petrochemical volumes and high price inflation.

Gulf Times – Qatar banking sector sees stupendous asset portfolio growth in 2011

Qatar’s banking sector has witnessed stupendous growth in its financial assets portfolio vis-à-vis nominal growth in total assets in 2011, while credit off-take grew faster than deposits, according to Qatar Central Bank (QCB) data.
The sector’s financial assets portfolio grew 104.6% in 2011 against 24% in the previous year. It was 64.9% in 2009; 26.1% in 2008; 23.9% in 2007; 18% in 2006 and 19.3% in 2005, the QCB said.
On the other hand, the banking industry’s total assets witnessed a 22.3% rise in total assets in 2011 compared to 21.3% in the previous year. Total assets gains were 16.4% in 2009; 36.5% in 2008; 55.3% in 2007; 45.8% in 2006 and 41.6% in 2005.

CityCenter suffers $45 million loss in fourth quarter « The Ticket Depot

MGM Resorts International said Monday that its CityCenter development had a net operating loss of roughly $45 million in the fourth quarter, but saw revenues increase roughly 4 percent. the company, which owns the 67-acre Strip complex in a 50-50 partnership with Dubai World, preannounced quarterly earnings for CityCenter Aria Resort & Casino on Monday when it unveiled plans to refinance $240 million in debt. In a statement, MGM Resorts said it plans to refinance the debt through a private placement and said the funds, along with cash on hand, would be used to pay off $300 million of CityCenter’s $2.5 billion debt. Earlier this month, MGM Resorts said it was amending its financing for portions of CityCenter debt to extend maturity dates by a year, to 2015. JP Morgan gaming analyst Joe Greff called the refinancing a “prudent, opportunistic move” given that the credit markets have seemingly loosened in recent months.

Big foreign funds assure to buy 5% stake sale in ONGC; govt to raise Rs 12000 crore - The Economic Times

Overseas investors, including sovereign funds from Abu Dhabi and Kuwait, have assured the government they would buy up the proposed 5% stake sale in Oil & Natural Gas Corp, setting the pace for accelerated divestment in cash-rich companies by a funds-starved government.

Representatives of various funds from Singapore, the Middle East and London, who met finance ministry officials last week, have informally 'underwritten' the stake sale in the state-run company that could help the government raise about Rs 12,000 crore at current market valuations, three people familiar with the discussions between the government and investors said.

Officials of Kuwait Investment Authority and Abu Dhabi Investment Authority were part of the team that discussed the issue with finance ministry bureaucrats. Representatives from CalPERS, the giant California pension fund, and Prudential, are also believed to have attended the meeting but this could not be immediately confirmed.

Dubai to take a £400m hit over bailout of Travelodge - The Independent

Dubai is bracing itself for a hefty £400m loss as Travelodge, the debt-laden hotel group it bought near the top of the market, finalises a bailout that would obliterate its investment in the company.

The New York hedge funds, Avenue Capital and Gold Tree Asset Management, will seize control of Travelodge in a "debt-for-equity" swap that will leave its creditors in control of the business.

The pair have agreed to underwrite a key £60m loan that will tide Travelodge over for a few weeks, while the details of a larger restructuring of the company's debts are hammered out.

Bahrain bankers relieved, eye infrastructure projects | Reuters

Bahraini bankers expressed relief on Sunday that the February 14 anniversary of last year's democracy uprising passed without major disruptions but said lenders needed to see more infrastructure projects in the Gulf bank and tourism hub.

"Thank God February 14 went fine to a great extent. There is hope that the political situation will be seen as stabilized to a great extent and agencies start increasing ratings," Abdulkarim Bucheery, chief executive officer of Bank of Bahrain, said at a meeting with reporters.

Bahrain, home to the U.S. Fifth Fleet, has been in turmoil since a protest movement erupted on February 14 last year and the government imposed over two months of martial law to crush it. Some ratings agencies downgraded Bahraini banks.

Israel plans sovereign wealth fund - FT.com

Israel has revealed plans to set up a new sovereign wealth fund, which will be tasked with managing the expected flood of money from a series of large natural gasfields discovered off the coast.
The fund is expected to have at least $80bn under management by 2040, providing the government with both a new income stream and a financial security cushion.