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Tuesday, 3 July 2012

gulfnews : Pride comes before the fall

Barclays chief executive Bob Diamond has resigned with immediate effect.
The move came after the bank was fined for trying to manipulate inter-bank lending rates, for its financial benefit, sparking a government inquiry and calls for criminal investigations. Chairman Marcus Agius, who has also announced his resignation, will now take over the running of Barclays until a replacement is found.
It is a classic case of pride before the fall. Diamond famously defended bankers and their salaries in the face of popular revulsion towards the lifestyle and attitudes of some banking executives in the wake of the global financial crisis. Under the hard-charging Diamond, Barclays was feted as an institution that not only survived the financial crises, but also used it as an opportunity to flourish. We now know that some of that success can be contributed to seemingly underhand dealings.

gulfnews : Digital content will dominate media — panel

Digital content will take over media and publishing in the next few years, panelists discussing local content and migration to digital platforms said in Dubai Media City yesterday.
Managing director and founder of Flagship Projects Shadi Al Hassan attributed the migration of content to the digital world to the recent power of applications.
“The evolution of technology has driven us, not only online, but also on apps because the market needs new tools to deliver content,” Al Hassan said.

gulfnews : Abu Dhabi to spend $40b on energy projects by 2014

Abu Dhabi’s state oil producer will spend $40 billion (Dh146.93 billion) on crude, natural gas, petrochemical and refinery projects from 2010 through 2014.
Gas projects under construction account for $25 billion of that, Mohammad Sahoo Al Suwaidi, chief executive officer of Abu Dhabi Gas Industries Ltd. (Gasco), said.
“These include Integrated Gas [IGD] and Shah Gas development projects,” Al Suwaidi added.

An investor probity milestone and football's stamina-sapping demands - The National

We're all for the cause of transparency and good governance in relations between the region's big companies and their shareholders, aren't we?

So it's good to be able to applaud another milestone on the road to investor relations probity, with the launch of the Abu Dhabi chapter of the Middle East IR (Investor Relations) Society.

Backed by the Abu Dhabi Securities Exchange as well as a sprinkling of the emirate's top corporates, such as National Bank of Abu Dhabi, Taqa and Abu Dhabi Commercial Bank, the chapter is the sixth to be launched this year.

Barclays breaks at blackest time for masters of universe - The National

The news from Barclays gets more serious by the hour, and will have profound repercussions for the global banking industry, as well as for the region. It comes at the worst possible time for the world's financial industry.

Until now, the 300-year old British bank was generally held to have had a pretty good crisis. Of course it was affected by the turmoil in global markets that began in 2008 and is still blowing around the world today.

But it came through the credit crisis without having to seek a government bailout, unlike many others. In fact, it got itself some pretty solid new investors from the Middle East. And it picked up the remnants of the collapsed Lehman Brothers business in North America for a song.

Common sense on lending regulations - The National

We've all seen the advertisements: drive it starting today, pay for it starting next year. That sort of inducement promises consumers the good life, and on convenient terms. But too often borrowers find themselves driving their sleek new vehicles in the express lane to a serious credit crackup, or even to debtors' prison.

Car loans, mortgages, credit cards, consumer lending: most people who have a steady income, even if it's a small one, can borrow money in one way or another - or rather one way and another - with little difficulty.

But then banks and other lenders enforce their rights with an iron hand, aided by a bounced-cheque law that has landed both Emiratis and expatriates in jail simply because they owe money. Last National Day, the government set up a Dh2 billion fund to clear the debts of Emiratis in default on loans.

Fujairah oil pipeline to flow this month - The National

A pipeline that will carry the bulk of Abu Dhabi's crude to the port of Fujairah - bypassing the strategically sensitive Strait of Hormuz - will be operational this month, a senior Abu Dhabi National Oil Company (Adnoc) official said.

Known as the Abu Dhabi Crude Oil Pipeline, the US$3.3 billion (Dh12.12bn) structure was originally slated for completion in 2010.

A day before Abu Dhabi celebrates its first shipment of crude oil 50 years ago, the head of the emirate's offshore production company said yesterday that the alternative route would soon be open. "Within July they will be in the commissioning phase," said Ali Al Jarwan, the chief executive of Abu Dhabi Marine Operating Company, one of Adnoc's offshore subsidiaries. "We expect that by August we'll have regular flow of oil."

Traders' woes defy Iraq optimism - The National

Laith Ahmed sells fridges and microwaves in Baghdad for a living. But with sales down by as much as 70 per cent in just two months, he has yet to benefit from the trickle-down of an economy that is expected to grow by 11.1 per cent this year.

Traders like him complain they are paying the price for a bloated public sector, persistent corruption and a lack of investment in vital infrastructure amid a deepening political crisis.

"Trade has virtually stopped," said Mr Ahmed, who buys his products from neighbouring Dubai and Amman. "No one wants to buy right now. There's an Iraqi saying that capital is a nervous entity and needs security to be confident and flourish."

MENA stock markets close - July 3, 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)

Dubai Emirates Islamic picks banks for benchmark USD bond | Reuters

Dubai's Emirates Islamic Bank, a unit of Emirates NBD, has picked banks for a potential benchmark-sized dollar sukuk, or Islamic bond, lead arrangers said on Tuesday.

The lender mandated Emirates NBD Capital, Credit Agricole , Dubai Islamic Bank, HSBC and Standard Chartered.

The initial price guidance for the issue was at a spread of 330 basis points over midswaps, maturing in 2018. Emirates NBD will underwrite it.

HSBC buys at least 5 pct of EFG Hermes: stock exchange | Reuters

British bank HSBC has acquired a stake of at least 5 percent in EFG Hermes, the Middle East's biggest home-grown investment bank, Egypt's stock exchange said on Tuesday.

Business at Cairo-based EFG was hit when a popular uprising ousted Egypt's president last year, throwing the country's economy into turmoil from which it has yet to recover.

EFG is folding its main investment banking business into a new joint venture with Qatar's QInvest, giving it more resources to expand operations across the region.

Xstrata investor backs Qatar proposal for better deal | Reuters

Activist fund Knight Vinke, a top-20 shareholder in miner Xstrata, said on Tuesday it supported a surprise call from fellow investor Qatar for better terms in a takeover offer from commodities trader Glencore .

Glencore, Xstrata's top shareholder, is currently offering 2.8 new shares for every Xstrata share held. Qatar, which has built a stake of around 11 percent in the miner, said last week it would demand a ratio of 3.25 in order to back the deal.

Knight Vinke said in a statement that the deal does not represent fair value for Xstrata on current terms and also objected to the fact no premium is being paid for a change of control.

UAE business activity at 3-month low in June |

Growth in business activity in the United Arab Emirates’ non-oil private sector eased to a three-month low in June, a purchasing managers’ survey showed on Tuesday.
The HSBC UAE Purchasing Managers’ Index, which measures the performance of the manufacturing and services sectors, fell to 53.2 points last month from an 11-month high of 53.8 in May.
The adjusted index remains above the 50-point mark which separates growth from contraction, the survey of 400 private sector firms showed.

UPDATE 1-UAE looks to open oil sector to more partners-exec | Reuters

The United Arab Emirates (UAE) is likely to allow more foreign partners, especially from Asia, to take stakes in its oil and gas concessions, the chief executive of Abu Dhabi Marine Operating Company (ADMA-OPCO) said on Tuesday.

Abu Dhabi, which has the largest share of the UAE's oil, plans to invest $60 billion over the next five years to boost its oil production capacity from 2.7 million to 3.5 million barrels per day (bpd) - and oil concessions lie at the heart of its ambitions.

The concessions system allows oil and gas producers to acquire equity hydrocarbons from the OPEC member in return for investing in projects.

Saudi Arabia keeps on pumping crude -

Oil prices have fallen below the key $100 a barrel, but Saudi Arabia is not lifting its foot off the accelerator.
Riyadh is moving into July pumping above its normal output for the sixth consecutive month, according to industry officials familiar with Saudi Arabia.
The kingdom has produced around 10m barrels a day, give or take 100,000 b/d, since February as Riyadh faced extra demands of crude from countries that were blacklisting Iran ahead of the introduction of European Union and US sanctions.

Eurasia Review

A ‘Notice of Discovery and its Commerciality’ for the Absheron discovery was submitted on behalf of the partnership Socar – Total – GDF Suez by operator Total E&P Absheron.

This step is an important milestone in the frame work of the Agreement on Exploration, Development and Production Sharing for the Absheron offshore block in the Azerbaijan sector of the Caspian Sea (EDPSA) signed on February 27, 2009. It is a confirmation of the importance of the discovery, announced in September 2011, on the Absheron X-2 well.

The well was drilled in 474 meters of water depth and reached a depth of 6874 m. One of the hydrocarbon bearing intervals was tested at 960 thousand cubic meters per day (km3/d) of non associated gas. During this production test, nearly 400 cubic meters per day (m3/d) – 2500 barrels per day (b/d) – of a 42,5° API condensate were also produced.

Gulf financial sector not fit to manage end-of-service liability money for firms in the region « ArabianMoney

Companies in the Gulf States will have accumulated liabilities of $75 billion in end-of-service payments by 2020, according to a new report from the market research group Insight Discovery.

It notes that if every expatriate left the region tomorrow then employers would have to find $16 billion to cover end-of-service gratuity payments. These payments are the closest thing to a lump-sum final salary pension scheme that exists in the Gulf.

The local financial sector would love to get its hands on this money. But ArabianMoney thinks it would be better left with the employers in most cases.

Qatar World Cup Funding May Get Harder on Europe: Arab Credit - Bloomberg

Qatar’s banks may struggle to finance $130 billion of infrastructure projects if a worsening European debt crisis prompts foreign banks to pull back their business in the country, the nation’s planning office said.
Escalation in the euro region’s debt crisis may spark a “flight from risk” and create “less-favorable conditions” for project financing, the General Secretariat for Development Planning said in a June report. The agency pointed to a 0.4 percent annual drop in deposits at banks in April as loans expanded 35 percent. Corporate deposits fell 12 percent.
Qatar is set to build a $35 billion rail and metro line, a $7.4 billion port, new roads and stadiums before hosting the 2022 soccer World Cup. As local banks try to keep up with credit demand, their loan-to-deposit ratio reached 118 percent in May, the highest in the Gulf Cooperation Council and up from 93 percent a year earlier, Bloomberg News calculations based on central bank data show. The spread between Qatar’s borrowing costs and U.S. rates widened more than 30 percent in 2012.

Dubai's GGICO signs debt restructuring deal | Reuters

Dubai-based Gulf General Investments Co (GGICO) GGIC.DU reached a restructuring deal with 25 of its creditors to extend debt maturities, the company said on Tuesday, bringing an 18-month process to a conclusion.

The firm, which has investments in manufacturing, industrials and retail under its umbrella, has delayed its debt repayments for seven years through new amortizing facilities, it said in a filing to the Dubai bourse.

The total figure of debt extended was not disclosed in the statement, although its first-quarter results said GGICO had 782.7 million dirhams ($213.1 million) of pending loans which the company had requested to be pushed out.