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Thursday, 19 April 2012

IMF's Lagarde: IMF loan for Egypt won't be enough | Reuters

Egypt's request for a $3.2 billion IMF loan will not be enough to meet the country's financial needs and will require additional resources from donor countries, the head of the International Monetary Fund said on Wednesday.

"It will not be sufficient, and everybody knows that, so it will require other donors, other participants to also come to the table to help Egypt," IMF Managing Director Christine Lagarde told a news conference before the start of the IMF and World Bank meetings in Washington.

"As is always the case, we will play the catalyst role that we always play," she added.

MENA stock markets close - April 19, 2012

 ExchangeStatus IndexChange  
 
 TASI (Saudi Stock Market)
 
7513.850.03%  
 
 DFM (Dubai Financial Market)
 
1638.25-0.27%  
 
 ADX (Abudhabi Securities Exchange)
 
2500.22-0.51%  
 
 KSE (Kuwait Stock Exchange)
 
6264.6-0.05%  
 
 BSE (Bahrain Stock Exchange)
 
1159.30.49%  
 
 MSM (Muscat Securities Market)
 
6004.12-0.06%  
 
 QE (Qatar Exchange)
 
8638.92-0.90%  
 
 LSE (Beirut Stock Exchange)
 
1180.41-0.44%  
 
 EGX 30 (Egypt Exchange)
 
4707.990.76%  
 
 ASE (Amman Stock Exchange)
 
2021.350.30%  
 
 TUNINDEX (Tunisia Stock Exchange)
 
5069.320.10%  
 
 CB (Casablanca Stock Exchange)
 
10396.2-0.58%  
 
 PSE (Palestine Securities Exchange)
 
471.110.66%  


UPDATE 1-Egypt sees Saudi financial help by end April - Yahoo! News UK

Saudi Arabia will deposit $1 billion at the Egyptian central bank and buy T-bonds worth $750 million by the end of April as part of a $2.7 billion package to support Egypt's battered finances, an Egyptian official said on Thursday.
Egypt's foreign reserves have tumbled by more than $20 billion to $15.12 billion during the political turmoil and
spasms of violence since Hosni Mubarak was ousted from power last year. The budget deficit has spiraled.
The Egyptian official told Reuters the Saudi package had been agreed two days ago at a meeting of Arab officials in Morocco. There was no immediate comment from Saudi officials.

Dewey presses to secure debt terms as international losses escalate- Legalweek

Turmoil at Dewey & LeBoeuf this week spread to the firm's international offices as it emerged that the new management team is making ground on renegotiating credit lines with its lending banks.
The firm's Dubai and London offices have seen a string of partner departures, with teams and individuals in countries including Italy and Russia also considering splitting away from the embattled US firm.
This week's five-partner walkout from the firm's Dubai office - alongside the departure of two London partners - to rival US firm Dechert has prompted a restructuring of Dewey's Middle East operations that could lead to the closure of the Dubai, Abu Dhabi and Doha offices.

Dubai banks feeling the heat | Global Investing

More than two years on from Dubai World, and Dubai is still struggling to sort out its debt.

Investors were shocked when government-owned Dubai World declared a payment standstill on its debts in Nov 2009 — a brutal tarnishing of the  ”sovereign halo”, which investors thought shone even on those borrowers whose debt did not have a solid sovereign guarantee.

A number of debt restructurings have taken place since then, including most recently for $2.5 billion in debt from Dubai International Capital (DIC). But banks are looking vulnerable.

Dubai debt: don’t mess with the emir | beyondbrics – FT.com

Dubai Inc is well on the way to completing $34bn in debt restructuring triggered by the 2009 financial crisis thanks largely to a policy of “bail out bondholders, burn the banks”, says Exotix, the investment broker.

Honouring bond investors’ claims has helped restore Dubai’s creditworthiness and allowed its government-related enterprises (GREs) to return to the capital markets. However, there aren’t many other governments that could follow Dubai’s example in forcing the bulk of the restructuring onto the banks, both local and international.

According to Exotix, Dubai has completed six bank debt restructurings totalling $21.9bn out of 11 totalling $34bn. The completed deals involve DHCDG ($555m) , Dubai World ($14.7bn), Dubai Aerospace ($800m), Nakheel ($2.2bn), Dubai Holding ($1.2bn), and Dubai International Capital ($2.5bn).

INTERVIEW: Mideast 2012 Bond Issuance May Hit $40 Billion -StanChart

Bond issuance out of the Middle East could rise to $40 billion in 2012, more than 50% above last year's levels, fuelled by the refinancing needs of local companies and the funding requirements of large new infrastructure projects, according to an executive of Standard Chartered PLC.

At the same time, Middle East bonds are in strong demand among investors both inside and outside the region, Henrik Raber, Standard Chartered's Dubai-based Global Head of Debt Capital Markets, said in an interview on Thursday.

"You're looking at a total of $30 to $40 billion of issuance, it's going to be a pretty robust year," Raber said. In 2011, total issuance from the Middle East amounted to only $26 billion, according to figures from Standard Chartered.

MIDEAST STOCKS-Dubai falls to 6-wk low; Gulf markets ends lower - Yahoo! News UK

Dubai's index slipped to a six-week closing low on Thursday and other Gulf bourses also fell as investors cut positions ahead of the weekend amid uncertainty in global markets.
Selling pressure in small-cap stocks led Dubai's benchmark to a fifth straight decline, down 0.3 percent to its lowest finish since March 3. Late buying helped the index recoup some intraday losses.
"The downward pressure came from expectations of a sell-off in international markets on concerns over Spain's bond auction," said Marwan Shurrab, vice-president and chief trader at Gulfmena Investments. "But when they saw it went well, some late buyers came in to pick up securities that were sold-off heavily during the day."

Dubai: copper-bottomed | beyondbrics – FT.com

The Gulf is bidding to win a share of the fast-moving global copper trade.

The Dubai Gold and Commodities Exchange will launch a copper futures contract this week, offering investors arbitrage opportunities with the leading copper markets  in London and New York, as well as Mumbai and Shanghai.

As Camilla Hall reports for the FT’s Middle East edition, the exchange plans to launch trading in 5-tonne, cash-settled $-denominated copper contracts on April 20.

Dubai defers $1.3 bln power project indefinitely | Agricultural Commodities | Reuters

Dubai Electricity and Water Authority (DEWA) said it has deferred plans to build the $1.3 billion Hassyan independent power and water project, citing increased efficiency at existing power plants.

"The Hassyan power plant project can be deferred until a later date," the state company said, adding that it had raised power production capacity elsewhere while demand growth had slowed.

Demand for cooling and fresh water have driven rapidly rising use of electricity in Dubai. But the government has been forced to reassess many of its projects following its standstill debt announcement in 2009.

Noor Islamic to arrange $1 bln Turkish debt by yr-end - CEO - Yahoo! News UK

Dubai-based Noor Islamic Bank has arranged more than $2 billion of debt transactions in Turkey since the beginning of 2011 and targets a further $1 billion before year-end, its chief executive officer told Reuters in an
interview on Wednesday.
"There's huge demand for financing in Turkey, mainly in the SME (small and medium enterprises) business. We've done $2 billion...and expect another $1 billion this year," said Hussain Al Qemzi.
"The bank is very active in the sukuk and structured finance syndications, mainly to financial institutions," he added.

Abu Dhabi to exit Daimler - report - Yahoo! News UK

Abu Dhabi is to exit its investment in German carmaker Daimler, a German magazine reported on Thursday.
The Gulf state's investment fund Aabar is currently discussing ways of disposing of its remaining stake after having cut its holding to 3 percent from 9 percent, manager magazin reported, citing company sources.
Oil-rich Abu Dhabi, which accounts for more than half of the UAE's economy, is reviewing its overseas investment portfolio as part of measures to instill more discipline in dealmaking among its investment firms.

Iran-Saudi oil relations to be affected if overproduction continues - Oil | Platts News Article & Story

Iranian Oil Minister Rostam Ghasemi said Thursday that Tehran had communicated to OPEC its objection to overproduction by some members, including Saudi Arabia, and warned that relations with the OPEC kingpin would be affected if Riyadh does not comply.

"It is our right as an OPEC member to object if production goes beyond the approved [OPEC] ceiling and I have communicated this to OPEC," Ghasemi told a Tehran news conference when asked to react to reports that Saudi Arabia would make up for the loss of Iranian crude oil as a result of EU sanctions.

"But some countries have not complied with this and Saudi Arabia is among them and this will definitely affect our oil interactions with them," he added.

Saudi must improve oversight of large loans - IMF | Reuters

Stricter regulation and supervision of Saudi Arabia's banks' large loan exposures to big corporate groups are necessary despite decent overall capitalisation, the International Monetary Fund said late on Wednesday.

Lenders in the world's top oil exporter are able to withstand severe temporary shocks, with the aggregate solvency ratio remaining above 8 percent for most scenarios, the IMF said in a study.

"However, the system could be vulnerable to a prolonged and deep oil price decline, especially if it were accompanied by a slowdown in domestic economic activity," IMF staff said in the report.

FACTBOX-Iran's NITC fleet storing up to 8 mln bbls oil - Yahoo! News UK

Iranian oil tanker operator NITC has had four supertankers anchored off Iran's coast for more than a month storing as much as 8 million barrels of crude, a level unchanged from March, according to Reuters calculations.
The draught measurements of the four very large crude carriers (VLCC) indicated they were fully, or almost fully, loaded, according to Reuters Freight Fundamentals Database.
It was not clear if the ships were carrying crude, fuel oil or other products.
Oil trade with Iran has become increasingly difficult as the European Union and the United States impose stricter sanctions aimed at cutting Tehran's oil revenues and forcing it to halt its nuclear programme.

Egypt's bourse suspends trading on Mobinil, OTMT | Reuters

Egypt's stock exchange suspended trading on mobile operator Mobinil and Orascom Telecom Media and Technology (OTMT) on request of the country's regulator, it said in a statement on Thursday without providing further details.

France Telecom has finalised a deal to buy most of its partner's stake in Mobinil for 1.5 billion euros. Under the terms of the accord, France Telecom will buy most of the stake held by Naguib Sawiris' holding company OTMT.

The deal is subject to regulatory approval in Egypt. The chairman of financial market regulator EFSA, Ashraf el-Sharqawy, had said the watchdog would give its response this week.

Bahrain: Risks rising - Bahrain - Zawya

While Middle East oil exporters could see a 4.8% GDP growth this year, Bahrain would be lucky to eke out a 2% increase this year, according to the International Monetary Fund in its latest report published on April 17.

Growth in the next two years is not heartening either, with 2013 clocking a 2.8% growth and 2014 witnessing a 2.9% improvement, according to IMF estimates.

After exploding onto the front pages early last year, Bahrain's political crisis had taken a backseat to the more violent Syrian crisis and the political drama unravelling in Egypt over the course of the past 12 months.

MENA's Enduring Macro Fundamentals and the Need for Broad Economic Change Create a Basket of Compelling Private Equity Opportunities - Zawya

Solid long-term macro fundamentals combined with short- and medium-term constraints on sovereign balance sheets will together create substantial opportunities for private equity investors across the Middle East and North Africa in the coming period, a top regional private equity leader told an industry gathering today.

"While the MENA region's risk profile may seem higher today than it was before the Arab Spring, we remain convinced that the emergence of true participatory democracies will be net positives for the region," said Citadel Capital Co-Founder and Managing Director Hisham El-Khazindar. "Indeed, we are cautiously optimistic that Egypt, our center of gravity, is largely on the right track in terms of a political transition to democracy, even though the nation will likely pass through substantial economic turbulence before all is said and done."

El-Khazindar was speaking on a panel titled 'The Arab Spring and investment opportunities,' the first session at today's PEI Capital Connect MENA 2012 in Dubai.

Qatar Lends Tunisia $500 Million at 2.5%, Gulf Times Says - Bloomberg

Qatar lent Tunisia $500 million at a 2.5 percent interest rate, the Gulf Times reported, citing the Tunisian central bank.

Dubai trade to rise more than 20% to $360bn in 2012 due to high oil price despite Iranian embargo and Arab Spring « ArabianMoney

Dubai Customs are confident that a 22 per cent rise in trade to $299 billion last year will spillover into a similar rate of growth for 2012, reported The National. Officials said that this target has already been exceeded in the first quarter.

The international embargo against Iran is hitting trade with that nation hard, particularly as its currency has also depreciated by half its value against the UAE dirham this year. But trade with Iran only accounts for around five per cent of Dubai trade, less than a sixth of the trade in gold and diamonds.

Fitch: Saudi Banks In Strong Position To Fund Loan Growth

Saudi Arabian banks have plenty of scope to fund loan growth in 2012 as the sector relaxes the cautious approach to lending that has dominated in the last few years, Fitch Ratings says.

This growth is likely to be at a reasonable pace and therefore should not hurt asset quality or banks’ viability ratings, said a statement from the rating agency.

It pointed out that rising deposits and several years of subdued loan growth had allowed Saudi banks to build up substantial surplus liquidity in the form of government securities and deposits with the Saudi Arabian Monetary Agency (SAMA).

gulfnews : Company seeks loan to fund world's tallest tower

Kingdom Holding Co., Saudi Prince Al Waleed Bin Talal's investment company, is seeking a loan to help pay for the construction of the world's tallest tower, two people with knowledge of the matter said.
The company initiated talks with Saudi lenders and hasn't hired bankers to advise on the financing, the people, who declined to be identified because the plans aren't public, said.
Kingdom Holding, 95 per cent owned by Prince Al Waleed, is seeking to borrow as much as 2 billion riyals (Dh1.96 billion) by the second half of the year, one of the people said.

NBAD dilemma as cap dampens aspirations - The National

National Bank of Abu Dhabi (NBAD) faces a possible watershed year as its growth aspirations bump up against new lending limits imposed by the Central Bank.

The bank is most tied to the Abu Dhabi Government's spending plans, giving it scale to grow faster than many domestic rivals, analysts from Deutsche Bank wrote in a research note.

"NBAD's close ties to the Abu Dhabi Government (a 70 per cent shareholder) and perceived financial strength have provided the bank with a significant funding cost advantage relative to peers, which in turn has enabled the bank to generate healthy margins without taking excessive credit risk," the report said.

Another wave of GCC spending - The National

Government spending across the GCC will jump again this year, spurred by higher oil prices and sluggish private credit, says the Institute of International Finance (IIF).

But the spending drive will be cushioned by steadily growing foreign reserves. The GCC's net foreign assets will reach US$2.1 trillion (Dh7.71tn) by the end of next year, up from $1.6tn last year, the IIF said.

"Expansionary fiscal and monetary policies are expected to remain in place in light of the continued rise in hydrocarbon revenues, the peg to the dollar, and the modest rebound in private credit," wrote George Abed, the senior counsellor and director of the IIF's Africa and Middle East department, and Garbis Iradian, the deputy director of the department, in a report released yesterday.

King of retail loses crown to London - The National

Dubai is out of the top spot on a list of the world's biggest shopping destinations as analysts warn the prevailing franchise arrangement for brands entering the Middle East could deter global retailers.

Last year, Dubai and London jointly attracted the most brands among the major world cities associated with upscale shopping, pipping Paris, Milan and New York, according to the international property specialist CBRE.

But Dubai has fallen to second place behind London in the past year, despite a high-street crisis in the United Kingdom that has resulted in a number of brands going into administration.

Real Madrid Sells Soccer Allure in Desert That Beat Tiger Woods - Businessweek

Real Madrid is at the center of a $1 billion bid to make a soccer-themed resort succeed in a Middle East country where race cars and golf failed.

The world’s richest soccer club is lending its name to a project in the United Arab Emirates with a 10,000-seat stadium and a target of 1 million visitors a year. The attendance goal exceeds the number of people who last year travelled to the emirate of Ras al Khaimah, where the project will be based.

Branded real-estate developments ranging from the Ferrari World amusement park in Abu Dhabi to a planned Tiger Woods golf resort in Dubai stumbled after the global financial crisis in 2008 caused investors and visitors to retreat. Securing financing for the park will be easier than attracting enough paying customers to make the investment pay off, according to Saud Masud, chief executive officer of SM Advisory Group LLC, a New York based investment firm.