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Wednesday, 4 July 2012

gulfnews : Oil now a weapon against Iran

During this week, the European Union’s (EU) embargo on Iranian oil came into full effect. This unprecedented historical move bears many signs indicating the importance of changes that have affected global energy markets in recent years.
Over the past decades, oil producing countries were the ones that determined the rules of the game in oil markets, as exporting countries have been using oil as a tool to apply pressure on consumers, especially during the Arab-Israeli war in 1973 during which time Arabs had halted oil exports leading to prices jumping five times.
Four decades after the 1973 war, the situation has changed and oil consuming countries are now pressurising oil exporting countries after they recently reducing their dependence on oil, especially from the Gulf countries by the developing alternative sources of energy. The countries to do so include the Americas, Brazil and Venezuela and the US.

gulfnews : Emirates in major network expansion to the East and West

Emirates airline said it is embarking on a major expansion of its route network with three additional destinations to be launched in the next six months, on top of the 12 new routes already being rolled out in 2012.
From November 1, Emirates will launch four weekly flights to Adelaide, rising to a daily service from February 1, 2013. Adelaide will be the airline’s fifth destination in Australia which is currently served with 70 flights per week, the carrier said in a press release.
The airline’s current double-daily service to Perth will grow to 19 weekly flights from December 1, becoming a triple daily operation from March 1 next year.

Soaring revenues take Etihad to record - The National

Etihad Airways yesterday posted a record jump in second-quarter revenues on the strength of surging passenger numbers, and said it was on track for a successful full-year performance despite challenging market conditions.

The airline said it earned US$1.25 billion (Dh4.59bn) over the second three months of this year, compared with $957 million over the same period last year – a jump of 30 per cent. Passenger numbers were up 34 per cent for the quarter, at 2.55 million, and now stand at 4.89 million for the first half.

Revenue for the first half now stands at $2.24bn, up 29 per cent from $1.73bn for the first half last year.

Profit-taking lowers DFM - The National

Dubai's shares fell yesterday as investors booked profits after a strong rally amid euphoria over Saudi Arabia's upcoming mortgage law.

Yesterday, Emaar Properties fell 1.6 per cent to Dh3.03 on the Dubai Financial Market (DFM) General Index. On Tuesday, Emaar jumped more than 6 per cent as investors speculated that the company's subsidiary in the kingdom, Emaar Economic City, would benefit from expected lending in the property market.

Yesterday, the Sharia-compliant mortgage lender Tamweeladvanced 2.4 per cent to Dh1.26. On Tuesday, Tamweel's shares jumped 5.1 per cent. The DFM General Index declined 0.8 per cent to 1,489.50 yesterday.

DP World must sell Australia holding - The National

The international ports operator DP World has been required to sell its stake in an Australian container terminal to its joint-venture partner, Flinders Ports, under the terms of their original contract.

The sale has been triggered by a transaction last year in which DP World, based in Dubai, agreed to sell 75 per cent of its entire Australian operations to the private-equity firm Citi Infrastructure Investors (CII) for A$1.5 billion (Dh5.66bn).

DP World's Australian subsidiary, DP World Australia, owns and operates container ports in Brisbane, Sydney, Melbourne and Fremantle. Included in that portfolio was a 60 per cent holding in Adelaide's container terminal.

Gulf banks flex new muscle - The National

Banks in the Arabian Gulf are expected to compete harder for market share in booming emerging economies as their financial strength increases relative to that of humbled global banks, according to the ratings agency Standard & Poor's.

As European lenders find their ability to provide finance sapped by the effects of the euro-zone debt crisis, many Gulf banks will find opportunities to expand their international reach into new territories, said Fevzi Timucin Engin, a financial analyst at S&P.

"Developed market banks have been piling up quite a few assets in the emerging-market space," he said. "Now they're finding with their own capitalisation issues and negative operating environments at home, they have a need to find additional liquidity."

UAE offers bail in US fraud case -

US businessman Zack Shahin, who has been detained in Dubai for more than four years on fraud charges, has received an offer of bail after mounting US pressure for a resolution to his case, lawyers say.
Mr Shahin, the former chief executive of government-linked developer Deyaar, has been on hunger strike for six weeks to protest his continued detention after facing several inconclusive trials since his arrest in 2008 on charges that he denies.
A judge set bail at Dh5m ($1.4m). He also demanded the retention of Mr Shahin’s passport and the submission of a UAE national’s passport as further surety against flight, according to his lawyer, Eric Akers.

Companies treat Libya with caution -

As Libyans prepare to flock to the polls for the first time in 47 years, regional businesses are perusing the potential opportunities in the new Libya.
But just as election monitors fear that violence could compromise this weekend’s voting for a General National Congress, businesses are finding that poor security, confusing bureaucracy and rising corruption are posing serious challenges to those seeking first-mover advantage in a potentially lucrative market.
Alex Warren, a Libya analyst, says many foreign companies are delaying possible entry into the market until later this year.

KEFI Minerals shares advance on latest Saudi Arabia gold exploration licence award - Proactiveinvestors (UK)

Shares in KEFI Minerals (LON:KEFI) advanced today following the firm’s latest license award in Saudi Arabia.
The gold explorer was now has four exploration licenses in the kingdom.
KEFI’s latest license spans almost 100 square kilometres and, according to managing director Jeff Rayner, it represents a ‘walk up’ drill target.

MENA stock markets close - July 4, 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)

Qatar banks should issue more bonds to meet funding needs - S&P | Reuters

Qatari banks need to depend less on deposits and issue more debt and Islamic bonds to raise capital if they are to continue fuelling the country's breakneck expansion without encountering future problems, an executive at Standard & Poor's said.

Loan growth in the Gulf Arab state, which posted a 14.1 percent increase in GDP last year, stood at 28 percent in 2011, according to a new report from the ratings agency on the state of the Gulf Cooperation Council (GCC) banking sector.

Slower deposit growth however meant that Qatari banks would need other sources, such as bonds and sukuk, to maintain credit growth and avoid funding problems in future, said Timucin Engin, associate director, financial institutions, at S&P.

Saudi Mortgage Law Opens Kingdom to Home Lending Surge - Bloomberg

Saudi Arabia’s mortgage law, approved two days ago after more than a decade of debate, will encourage banks to expand lending in a $16 billion market that now accounts for less than 4 percent of all home purchases.
The market may increase to about $32 billion annually over the next 10 years, providing opportunities for lenders, property developers and middle-class Saudi homebuyers, according to Naveed Siddiqui, chief executive officer of Capitas Group International, a Saudi holding company focused on Islamic finance.
Enlarge image
Ibrahim Al-Assaf, minister of finance of Saudi Arabia. Photographer: Tim Boyle/Bloomberg
“The financial sector alone in Saudi Arabia will not be able to fill the gap,” he said. “The government will have to allow non-banking financial institutions such as mortgage companies to come in to stimulate the market.”

South Africa poised to launch debut Islamic bond | Reuters

South Africa is preparing to launch sub-Saharan Africa's first Islamic bond, paving the way for issues by other countries in the region, officials said on Wednesday.

Thuto Shomang and Monale Ratsoma of the South African Treasury's government borrowing department told Reuters that South Africa was leaning towards a dollar-denominated, five-year sukuk, using an ijara structure.

"It's the one that seems to attract investors' interest. That's the one that the recommendations have been on so far," said Ratsoma, adding that first-time issuers usually chose five-year tenors so that was what South Africa was considering.

UPDATE 1-Dubai's Tamweel postpones asset-backed sukuk sale | Reuters

Islamic mortgage lender Tamweel has decided to delay the sale of a $235 million sharia-compliant asset-backed securitisation after taking feedback from the market, the company said in on Wednesday.

Investors and traders in the Gulf region said the deal structure was too complex by regional standards, which has only ever seen one previous Islamic asset-backed transaction.

"Tamweel has decided not to proceed with the RMBS (residential mortgage-backed securities) at this time based on market feedback," the company said in a bourse statement.

UPDATE 2-UAE's Emirates Islamic Bank prices $500 mln sukuk | Reuters

Emirates Islamic Bank, the sharia-compliant arm of Dubai's largest lender Emirates NBD , priced a $500 million sukuk on Wednesday, as the lender took advantage of strong demand for Islamic debt from the Gulf Arab region.

The sukuk, due to mature in January 2018, priced at par at a spread of 310 basis points over midswaps and carried a profit rate of 4.147 percent, lead arrangers said.

It is EIB's second debt markets foray this year, after the lender issued a $500 million Islamic bond in January. That issue carried a profit rate of 4.718 percent.

Persian Gulf Stocks: Agility in Kuwait and Tamweel in Dubai - Bloomberg

Dubai’s benchmark DFM General Index (DFMGI) fell 0.8 percent, the most since June 14, to 1,489.58 at the close in the emirate. Qatar’s QE Index (DSM) was litle changed.

An efficient way to keep the Gulf cool -

Air conditioning is a necessity in the Gulf, where summer temperatures regularly soar into the 40s and 50s.
It is a costly essential, however, because of cold air systems’ high electricity use. The cooling systems that keep buildings functioning consume half of total electricity output in Gulf Co-operation Council countries.
That means a yearly fuel opportunity cost of roughly $20bn. Indeed, air conditioning is the main determinant of regional power requirements, some 70 per cent of peak-period electricity consumption. But despite it being crucial to commercial and residential wellbeing, GCC governments have not regarded its provision as requiring public policy and planning.

Carillion sees contracts delayed by euro fears | Reuters

Uncertainty caused by the euro-zone crisis has put the brakes on some infrastructure projects in the Middle East and Britain, support services and construction firm Carillion Plc (CLLN.L) said on Wednesday.

Carillion, which maintains some of Britain's railways and military bases and has a strong construction presence in Canada and the Middle East, said market conditions in the first six months of 2012 had been challenging, although its pipeline of potential work had grown to 35 billion pounds ($54.9 billion).

"The uncertainty this year is probably a result of the euro crisis, certainly in the UK and a little bit in the Middle East," Carillion Chief Executive Richard Howson told Reuters.

Gulf banks will likely continue steady recovery from 2008 crisis through 2013 despite eurozone turmoil -

Standard & Poor's Ratings Services expects Gulf banks to continue their steady recovery from the 2008 crisis and remain isolated from eurozone turmoil for the rest of 2012 and 2013, according to its published report titled "Gulf Banks Shrug Off Eurozone Turmoil To Continue Steady Recovery From 2008 Crisis."

"We believe the trend of declining loan loss provisions will continue for most of the banks in the Gulf Cooperation Council, resulting in further recovery in reported net profits despite adverse conditions in the eurozone and international banking markets," said Standard & Poor's credit analyst Timucin Engin.

Since the start of the global financial crisis in 2008 and despite slower balance sheet growth, most Gulf Cooperation Council (GCC) banks have maintained healthy earnings generation before provisioning.

Bargains galore as Gulf resident fly away to cooler climates this summer « ArabianMoney

The increased capacity on many routes from the Gulf of Arabia to cooler climates this summer is bringing some stunning offers for passengers that are keeping the planes full.

Emirates Airline’s rolling program of introducing super jumbo A380s on new routes means the Dubai carrier has more seats to sell, though the aircraft is proving very popular with the travelling public for its quietness and superior facilities, including a bar and showers on the upper deck.