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Tuesday, 27 March 2012

gulfnews : UAE banking sector needs a credit evaluation agency

The UAE Central Bank has found itself in an odd predicament following its attempts to control the lavish personal loans local banks offer Emiratis and expatriates. On one hand, the Central Bank's moves have angered loan seekers. On the other, they are unwelcome to bank administrators, whose annual income and net profits depend heavily on personal and commercial loans.
To understand the nature of the problem between the Central Bank and other banking institutions, we have to acknowledge that financial services companies have the capacity to manipulate the rules and regulations set forth by the Central Bank. All banking institutions have professionals who can find loopholes and bend the rules and regulations to allow them to continue to give loans.
The rules, regulations and conditions set forth by the Central Bank contain wordings that, if changed, misinterpreted or bent, can reverse the original meaning intended by the Central Bank. Thus, banking institutions have resorted to hiring teams of lawyers and linguists to search for such loopholes in order to "legally" break the rules. These measures are intended to find ways to facilitate loans for clients.

Egypt's 2012 stock boom worries some fund managers | Reuters

Egypt's stock market has jumped 37 percent so far in 2012, the largest gain of any country, but top U.S. fund managers focused on the region remain wary of further political turmoil and currency weakness in the most populous Arab nation.

The country's main stock index lost nearly half its value last year as massive public protests drove longtime president Hosni Mubarak from power in February 2011 and military leaders assumed control. This year's stock market bounce came as investors snapped up shares of companies like Orascom Construction Industries SAE and telecom carrier Egyptian Co for Mobile Services SAE.

But in recent interviews, several fund managers who most closely follow the nation said significant risks from Egypt's political and economic situation remained. Egypt's fragmented political parties are struggling to reach consensus on a new constitution and tensions are rising with a president election just two months away.

Russia placing blockbuster $7 billion Eurobond deal - Yahoo! News UK

Russia will raise $7 billion in Eurobonds in the largest emerging markets sovereign offering since at least 2000, fully covering its foreign borrowing plan for 2012, sources close to the deal said on Tuesday.
Capitalizing on strong oil prices that have boosted confidence in Russia's fiscal performance, the dollar offering attracted bids of $17 billion, leading the Finance Ministry to slightly tighten yield guidance on the three-tranche deal.
Russia plans to issue $3 billion in 30-year paper at 250-255 basis points over U.S. Treasuries, establishing a new benchmark long bond in its first international offering since April 2010.

Abu Dhabi may seek sweeteners for RBS deal - Yahoo! News UK

If Abu Dhabi's sheikhs or sovereign funds opt to buy some of the British taxpayer's stake in Royal Bank of Scotland, the purchase price for the shares could be less important than any sweeteners attached to a deal.
That's the message from its successful but complex bet on Barclays in October 2008, which helped save the UK bank from a state rescue and earned a hefty profit for the Middle East investor.
Britain is in talks to sell some of its 82 percent stake in RBS to Abu Dhabi investors, sources told Reuters.
They said talks have been going on for months, but if a deal is reached it will probably take months longer.

RLPC-Dubai's JAFZA eyes loan launch-bankers - Yahoo! News UK

Dubai's Jebel Ali Free Zone (JAFZA) is preparing to launch a large syndicated loan to partly refinance its $2 billion Islamic bond that matures in November, bankers familiar with the deal said.
JAFZA, which runs an industrial free zone on the outskirts of Dubai, is considering a $900 million syndicated loan, which will be followed by a $600 million sukuk and up to $500 million of cash repayments over the coming months, one of the bankers said.
The Dubai government-owned free zone has mandated Abu Dhabi Commercial Bank, Emirates NBD and Dubai
Islamic Bank, with Citi and Standard Chartered acting as coordinators, the bankers added.

MIDEAST STOCKS-Most markets fall as traders hesitate ahead of Q1 - Yahoo! News UK

Most Gulf Arab markets fell on Tuesday as an early-year rally gave way to consolidation, with investors now wanting to see if first-quarter results can justify recent share price gains.
Saudi Arabia's index fell for a first session in five, slipping from Monday's 42-month high. Zain Saudi dropped 5.1 percent. The indebtedtelecoms operator's shares have gained 67 percent since late January, when it received approval to extend a 9.75 billion riyal ($2.6 billion) Islamic financing facility for an additional six months.

FACTBOX-Key political risks to watch in Saudi Arabia - Yahoo! News UK

Saudi Arabia, which sits on a fifth of global crude reserves, is the world's top oil exporter, holds significant dollar assets and acts as a Middle East linchpin of U.S. security policy. It also has the biggest Arab stock exchange.
Here are some political risks facing the kingdom:

SUCCESSION
Changes in the royal line last year raised questions about
the pace and direction of gradual economic and social reforms
aimed at reconciling conservative Islamic traditions with the
needs of a youthful, increasingly outward-looking population.

MENA stock markets close - March 27, 2012

 ExchangeStatus IndexChange  
 
 TASI (Saudi Stock Market)
 
7767.33-0.20%  
 
 DFM (Dubai Financial Market)
 
1652.44-0.18%  
 
 ADX (Abudhabi Securities Exchange)
 
2574.57-0.11%  
 
 KSE (Kuwait Stock Exchange)
 
6186.7-0.35%  
 
 BSE (Bahrain Stock Exchange)
 
1152.42-0.15%  
 
 MSM (Muscat Securities Market)
 
5794.58-0.54%  
 
 QE (Qatar Exchange)
 
8772.960.53%  
 
 LSE (Beirut Stock Exchange)
 
1217.28-0.33%  
 
 EGX 30 (Egypt Exchange)
 
4985.321.57%  
 
 ASE (Amman Stock Exchange)
 
1987.67-0.18%  
 
 TUNINDEX (Tunisia Stock Exchange)
 
4801.23-0.40%  
 
 CB (Casablanca Stock Exchange)
 
10881.7-1.05%  
 
 PSE (Palestine Securities Exchange)
 
486.890.36%  


Kurds May Halt Crude Exports If Iraq Withholds $1.5 Billion - Bloomberg

Crude exports from Iraq’s semi- autonomous Kurdish region dropped to 50,000 barrels a day and may cease in a month if the central government refuses to pay about $1.5 billion owed to producers, Kurdish authorities said.
The Kurdistan Regional Government also called today on foreign companies including BP Plc (BP/) not to make separate agreements with Iraq’s central government to develop oil fields in and around the disputed northern city of Kirkuk. The central government has said it is talking with BP about boosting output at a field called Kirkuk, near the same city.
A dispute over oil revenues between Iraq’s government and Kurdish authorities led to a yearlong halt in exports from the region that ended in February 2011. Iraq holds the world’s fifth-biggest crude reserves, based on BP statistics that also include Canadian oil sands, and it seeks to boost oil exports to help rebuild an economy recovering after years of conflict, sanctions and sabotage.

Vodafone Remains Exposed to Egypt Risks After Uprisings - Bloomberg

Over five days early last year, as the revolution escalated in Cairo, Hatem Dowidar, the chief executive officer of Vodafone Group Plc (VOD)’s Egypt unit, yielded to the regime’s demands to issue pro-government text messages.
While he objected, his focus was to keep his damaged operation running amid the chaos and he considered the “public safety” messages to be harmless. The instructions kept coming until Feb. 2 when security forces ordered Vodafone to announce the time and place of a demonstration in support of then President Hosni Mubarak. That day, clashes between protesters and government loyalists in Tahrir Square hours later resulted in the deaths of 20 people.
A year on, Vodafone is seeking an amendment to the law to curb the state’s control and to protect its Egypt investments. With the European Union set to publish a report this week demanding the company learn from its “past mistakes” when it gave in to Mubarak’s demands, Vodafone’s response and its crisis planning are still under the spotlight.

NEWSMAKER-Dealmaker Staveley leverages links to Arab royals - Yahoo! News UK

British dealmaker Amanda Staveley, restaurateur turned go-to broker for the Abu Dhabi royal family, has made millions in a region where women rarely play high-profile roles.
More could be in the pipeline after sources said on Tuesday that she was advising the Abu Dhabi ruling family on talks to buy a stake in Royal Bank of Scotland, in which Britain took a stake of 83 percent at the height of the financial crisis.
The Briton, 38, who knows her way around the hallways of power in the Middle East, played a prominent role in Abu Dhabi royal Sheikh Mansour bin Zayed al-Nahayan's 2008 investment in another British bank, Barclays.

Internet economy in Saudi Arabia forecast to reach US$25.5 billion by 2016, 3.8% of GDP - bi-me.com

The Saudi Internet economy contributed SAR37 billion (US$9.9 billion) to the overall Saudi economy in 2010, representing 2.2% of GDP, and putting Saudi Arabia at 13th place amongst the G-20 countries.

This figure is projected to rise to SAR107 billion (US$28.5 billion) by 2016, representing 3.8% of GDP, according to a new report in The Boston Consulting Group’s Connected World series.

It found that by 2016 the total size of the G-20 Internet economy will be $4.2 trillion, equivalent to 5.3 percent of GDP, up from $2.3 trillion or 4.1 percent in 2010.

Mubadala: getting back in the groove | beyondbrics – FT.com

Mubadala is back.  The announcement of a $2bn investment in Brazil signals a return to big-spending, strategic overseas moves that characterised the Abu Dhabi state investment company until the emirate ran into economic trouble in the last couple of years.

The $46bn diversified group mandated to generate financial and social returns is buying a 5.6 per cent stake in Eike Batista’s Brazilian EBX Group after a bit of a lull in its own operations and in the Abu Dhabi economy.

Oil-rich Abu Dhabi didn’t feel very rich last year. The capital had been the engine of the United Arab Emirates’ growth during neighbouring Dubai’s troubles after the global financial crisis.

Persian Gulf Stocks: BankMuscat of Oman, Kuwait Finance House - Bloomberg

Kuwait’s SE Price Index fell 0.4 percent to 6,186.70, the lowest level since March 14, at the 12:30 p.m. close in Kuwait City. Oman’s MSM30 Index lost 0.5 percent.

Kuwait spending may be unsustainable-World Bank | Reuters

Kuwait will probably struggle to sustain its level of government spending in the medium term because oil prices may fall, a World Bank official said on Tuesday, warning that the Gulf state's economic development plans were also at risk because of the indifference of the private sector.

Bassam Ramadan, country manager for Kuwait at the World Bank, said the average price of various types of crude oil could fall by 10-15 percent from current levels to around $85 per barrel by 2020.

This would put pressure on the oil exporter's state finances, especially given a series of public sector wage hikes over the past six months, he said.

Saudi Electric launches 2-part $1.75 bln Islamic bond - Yahoo! News UK

Saudi Electricity Co launched a $1.75 billion two-part Islamic bond on Tuesday, with tighter pricing on both the five-year and 10-year tranches, indicating strong demand.
The $500 million 5-year portion was launched at a spread of 140 basis points over midswaps, from 160 bps over midswaps indicated earlier in the day.
The $1.25 billion 10-year tranche launched at 195 bps over midswaps, tightening from the 210 bps range earlier.
Pricing is expected later on Tuesday.

INTERVIEW-Abraaj gears up for IPO next year-CEO - Yahoo! News UK

Dubai-based Abraaj Capital, the Middle East's largest private equity firm, is gearing up for an initial public offering (IPO) as early as next year following its recent acquisition of emerging market fund manager Aureos Capital, the company's Group Chief Executive Arif Naqvi said on Tuesday.
"Inevitably we have to. It's not a 2012 event. It could be 2013," Naqvi told Reuters in an interview.
"The Aureos acquisition was a crucial stepping stone on Abraaj's path to IPO," he added, without giving more details on the stake to be offered or the market where shares will list.

Gulf Arab states to see lower 2012 growth-Kuwait Fin Min | Reuters

Gulf Arab oil exporting countries are expected to see lower economic growth of around 4 percent this year due to a drop in global demand, Kuwait's Finance Minister Mustapha al-Shamali said on Tuesday.

"It is expected that the average economic growth rate of the GCC (Gulf Cooperation Council) countries will slow down to about 4 percent in 2012," Shamali told a financial conference.

Asked whether he expected Kuwait's growth would be higher in 2012, he told reporters: "We hope so. About 5 something."

Sleepless in Dubai as Traders Rejoice Eight-Fold Volume Gain - Bloomberg

Just four months ago, share prices and trading values in Dubai fell to the lowest levels since 2004. Now stock trading has increased eight-fold, the most among the world’s 40 biggest markets, as the emirate rebounds from its biggest financial crisis.
“In December, you could fall asleep at your desk and wake up and nothing would be happening,” said Waleed Al Khateeb, 37, the senior finance manager at Daman Securities LLC in Dubai. This year, brokers are working non-stop “dealing with this increased activity,” he said in a March 15 phone interview.

Bahrain fund Mumtalakat's ex-head joins PineBridge as Mena CEO - Yahoo! News UK

The former chief executive of Bahrain's sovereign wealth fund Talal Al Zain has joined the $67 billion global investment firm PineBridge to head its Middle East and North Africa operations, the fund said in a statement
on Tuesday.
Al Zain, who resigned from Mumtalakat last month after taking the helm at sovereign fund in 2008 having spent an 18-year stint at alternative asset manager Investcorp, will spearhead the expansion of PineBridge's MENA presence.
Al Zain's appointment at PineBridge will lead the investment firm's push into the region's equity and fixed income market as well as access to the oil wealth of the Gulf Cooperation Council, given its existing private equity capabilities in Istanbul, Turkey and distribution office in Dubai, UAE.

Kuwait Finance House Plans to Restructure, Sell Units, KUNA Says - Bloomberg

Kuwait Finance House (KFIN), the country’s largest Islamic lender, plans to restructure, merge or sell unprofitable units, state news agency KUNA reported, citing Chief Executive Officer Mohammed Al-Omar.
The bank’s reorganization plan, which involves creating separate divisions for banking, investment, operations and wealth management, has been approved by the board and will include “the appointment of new leaders,” Al-Omar said, according to KUNA.

Maroc Telecom says plans capital increase | Reuters

Maroc Telecom said on Monday it plans to raise its capital by as much as 22.7 percent, prompting traders on the Casablanca bourse to speculate that Morocco's main telecom player may make a fresh acquisition in Africa.

The affiliate of French operator Vivendi will ask a shareholders' assembly to vote on April 24 for the management's proposal to raise its capital by up to 200 million shares, the company said in a statement to the Casablanca bourse.

It did not say what it needed the capital increase for. Traders in Casablanca said that, if approved, Maroc Telecom's capital hike would be the Casablanca bourse's biggest ever.

gulfnews : Saudi's NCB Capital will launch four funds this year

Saudi Arabia's NCB Capital, the investment arm of the kingdom's biggest bank by assets, plans to launch four investment funds this year and target up to 15 per cent growth in assets under management, its chief executive said.
Jawdat Al Halabi said the National Commercial Bank unit, which has 44 billion Saudi riyals (Dh43 billion) in assets under management, will launch the funds in the second half of the year, with two aimed at foreign markets and two domestically focused.

LNG imports just a short-term solution to fuel the country - The National

It is the modern equivalent of bringing coals to Newcastle. So why is the holder of the world's seventh-largest gas reserves planning to import gas, and what's more, in its most expensive form?

It was revealed last Monday that two of Abu Dhabi's companies, Mubadala Development, a strategic investment company owned by the Abu Dhabi Government, and the International Petroleum Investment Corporation, would build a terminal at Fujairah to import liquefied natural gas (LNG).

LNG, not to be confused with the bottled gas (LPG) used for cooking, is simply natural gas, cooled to minus162°C to turn it into a liquid that can easily be transported in special tankers. The terminal will be of an innovative floating design, fast to install, and capable of being moved if it is not needed in later years.

Saudi Electricity may go for long Sukuk tranche | A1SaudiArabia.com

Massive demand for Saudi Electricity Cos (SEC) first international sukuk issue may prompt the company to include a rare long-dated tranche – and could encourage issues by other utility companies in the Gulf.
Since last week, roadshows held by SEC in Asia, the Middle East and Europe have underlined the fact that its sukuk has almost everything possible going for it: it is the first issue of dollar-denominated Saudi paper since 2010, and the debt is a sukuk, which means it will tap a pool of Islamic investors.
“”The prevailing tight yields as well as market liquidity, especially within the GCC, is a key reason for SEC to tap global debt markets,”" said Chanaka Dassanayaka, fund manager at Alistithmar Capital in Riyadh. “”The dollar-denominated issuance allows for more foreign participation, and given it is a key Saudi entity with a history of several successful local issuances, they can bargain for better terms with the market participants.

UAE markets could use a Big Bang - The National

The UAE has been experiencing a capital market trauma.

Equities traded value on its stock exchanges dropped nearly 90 per cent last year from 2008 levels and the major indexes fell 50 per cent or more.

There has been an IPO drought on UAE exchanges. Before 2008, subject to the usual ups and downs, the markets were active and many investors made significant returns.

Nasdaq Dubai chief urges market revamp - The National

Jeff Singer, the chief executive of Nasdaq Dubai, has called for a radical revamp of the UAE's stock markets to "create an underpinning for long-term growth" of the national economy.

The plan, which has been presented to the exchange's board, aims to produce a "road map" for solving the problems facing the country's markets.

Despite rising prices and volumes this year, the three markets in Dubai and Abu Dhabi have underperformed most global indicators since 2008.

gulfnews : Dubai recovery softens regional blow

Political unrest in Syria, Egypt and Bahrain affected business for developer Majid Al-Futtaim (MAF) in 2011, but positive results in Dubai helped soften the blow, the firm's chief executive said yesterday.
MAF's hotels in Bahrain suffered low occupancy rates in 2011, leading to a Dh300 million writedown, while assets in Egypt, where MAF is in the process of building a mall in Cairo, lost Dh250 million.
But chief executive officer Iyad Malas stressed that despite the writedowns, overall asset value increased on the strength of its Dubai malls including Mall of the Emirates and Deira City Centre.

Abu Dhabi Group expresses confidence in Pakistan - The News

Sheikh Nahayan Bin Mabarak Al-Nahayan, Chairman, Abu Dhabi Group met with senior government officials and dignitaries and members of the Abu Dhabi Group of Companies in Pakistan on his recent visit to Lahore, a statement said on Monday.

The visit was intended to reinforce the Group’s commitment to Pakistan and to reiterate confidence in its new strategic direction and renewed vision set forth for all the Group’s investments, it said.

Abu Dhabi Group enjoys being one of the largest business groups in the Middle East and the single largest foreign investor in Pakistan with assets worth $6.5 billion. Expressing his views on their 15 years in the country, Al-Nahayan said, “We entered Pakistan in 1997 with the inception of Bank Alfalah and today we have countless success stories behind us with our investments only multiplying in numbers, returns and diversity, be it Financial Services, Telecommunication, Property or Health Services. The Group is committed to providing all the resources necessary to become ‘The Best in Class’ in whatever we do.”

Batista gets a new friend from the Gulf | beyondbrics – FT.com

There’s nothing like a friendly sheikh in the Gulf to solve your money problems.

Brazil’s richest man, Eike Batista, announced on Monday that Mubadala, an investment arm of the Abu Dhabi government, is to invest $2bn in his EBX group. In return Mubadala will get a 5.63 per cent stake in EBX’s investment vehicle.

A perfect match, perhaps? Batista may be worth an estimated $30bn but that doesn’t mean he doesn’t need the money. The tycoon has recently taken on Brazil’s state-run oil company, Petrobras, in a bid to become Brazil’s biggest private producer of crude. He has also expanded his mining empire to even more diverse areas – hospitality, real estate, technology, and beauty companies.