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Saturday, 21 October 2017

Adia deal shows India ripe for infrastructure investment - The National

Adia deal shows India ripe for infrastructure investment - The National:

"India's poor infrastructure is creating substantial opportunities for investment as the Indian government pushes to make the sector more attractive for investors amid a desperate need to overhaul of many of the country's most basic facilities.

“The infrastructure problem itself is throwing up a lot of opportunities,” says Shailesh Puranik, the managing director of Puranik Builders, an Indian property developer. “And I think this is one of the best times for international money to come to India because of the favourable market conditions, because of the favourable government at the centre, and because of the favourable policies that we have. They're looking for more and more investment to come in.”

India is likely to see increased foreign investment flowing into the country over the coming years because of these factors, he says."



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Are fears of a rising threat of disruption to oil industry justified? - The National

Are fears of a rising threat of disruption to oil industry justified? - The National:

"Oil markets have been sanguine about geopolitical risk in recent years.

At the peak of oil prices in 2008, observers ascribed as much as US$10 to $15 per barrel of the price to a “risk premium”. Now, with Iraqi troops advancing on Kirkuk and the US president Donald Trump ceasing to certify the Iran nuclear deal, is it time for the risk premium to return?

Oil prices have risen significantly since their year-low of $44.82 for Brent crude in June. In the week running up to the Kurdish vote, Brent gained $3 to reach a 2017 high of $59.02 on September 25 before falling back a little, closing at $57.17 on Friday. Continuing adherence to the Opec production cuts agreement has been supported by robust demand."



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Bulls continue to gain ground | GulfNews.com

Bulls continue to gain ground | GulfNews.com:

"The Dubai Financial Market General Index (DFMGI) advanced by 12.50 or 0.34 per cent last week to close at 3,672.77. That’s the highest weekly close of the past eleven weeks. There were 21 advancing issues and 17 declining while volume jumped to a 35-week high. There were other signs of strengthening last week as well. Although the index didn’t make much progress it did manage to close above the prior week’s high of 3,661.48 on a weekly basis and above the most recent swing high of 3,667.42. Plus, this occurred on much higher volume. Sometimes spikes in volume can be a leading indicator and it looks like that may be the case here. Last week’s high of 3,676.65 pushed up against resistance of 3,681.11, which is the August high and high for the four-month uptrend. Given the bullish signs just discussed, especially higher volume, the odds favour a breakout above the August peak within the near-term. If that occurs a continuation of intermediate-term uptrend (19-week) will be triggered. All of the points above further confirm the likelihood that the minor correction off the August high has completed and the uptrend is getting ready to proceed. Regardless, nothing is for sure until we see further bullish signs as noted. "



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PIF gets ready to make its debut on the sovereign wealth fund stage | Arab News

PIF gets ready to make its debut on the sovereign wealth fund stage | Arab News:

"In New York last month, Yasir Othman Al-Rumayyan, CEO of the Saudi Arabian Public Investment Fund (PIF), was asked how its mission has changed from the original mandate when it was set up in 1971. “Now, we’re looking at things differently. It has to make commercial sense, in addition to the developmental aspect. But it has to be efficient, because if it’s not efficient, it’s not going to work out,” he responded. That, in a nutshell, is the new face PIF is showing to the world, and which will be on prominent display in Riyadh next week when it hosts the Future Investment Initiative in front of $22 trillion worth of executives, financiers and policymakers."



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Exclusive: Qatar diplomatic crisis delays sale of Gulf shipping firm, sources say

Exclusive: Qatar diplomatic crisis delays sale of Gulf shipping firm, sources say:

"Qatar’s diplomatic crisis is holding up the sale of a shipping company it part owns, one of the latest signs of an emerging corporate fall-out that Doha is facing after Arab countries cut relations in June, sources familiar with the matter said. Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed diplomatic, trade and transport ties with Qatar in June, accusing it of supporting terrorism - a charge Doha denies. The dispute has hit Qatar’s financial sector, with banks in neighboring Arab states withdrawing billions of dollars from Qatari lenders. Now there are signs that deal-making in the region is also running into difficulties."



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Oil market is improving and stabilizing, Saudi oil minister says

Oil market is improving and stabilizing, Saudi oil minister says:

"The global oil market is improving and stabilizing, Saudi Oil Minister Khalid al-Falih said in Baghdad on Saturday. In a speech at the opening of the Baghdad International Exhibition, Falih praised the cooperation between Iraq and Saudi Arabia, which he said, contributed to “the improvement and stability we are seeing in the oil market”. Falih is the first Saudi official to make a public speech in Baghdad for several decades. The two countries began taking steps towards detente in 2015 after 25 years of troubled relations starting with the Iraqi invasion of Kuwait in 1990."



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Friday, 20 October 2017

Land of milk and money: Qatar looks to farms to beat the Gulf boycott | World news | The Guardian

Land of milk and money: Qatar looks to farms to beat the Gulf boycott | World news | The Guardian:

"John Dore is off to Doha’s vast and luxurious Hamad International airport to greet the 8pm flight from Los Angeles via Li├Ęge, Belgium.

Wearing a straw hat with a small metal shamrock badge in homage to his Irish roots, his imminent visitors are neither family nor friends. Nor are they human at all, but rather a herd of 120 cows.

A 58-year-old farmer from Co Kildare might seem an unlikely pivotal figure in a bitter dispute between the Gulf monarchies, but as the chief executive of the sprawling Baladna farm in the desert 60 kilometres north of Doha, Dore is a vital player in Qatar’s struggle for political survival."



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Thursday, 19 October 2017

Sovereign wealth funds seek closer Silicon Valley ties

Sovereign wealth funds seek closer Silicon Valley ties:

"Ibrahim Ajami admits to being concerned about the high valuations of tech start-ups. But not so much that he is not ready to put another $600m of venture money to work — not to mention the $15bn his group already ploughed in last year. As the man in charge of venture investing for Abu Dhabi’s Mubadala sovereign wealth fund, Mr Ajami’s general wariness is appropriate. Funds like his have come late to the party, at what, for a while, has been looking like a cyclical peak in start-up funding. His defence is that good companies never have a problem going public, and that there are enough truly disruptive, world-beating companies to make it worthwhile. It is true that buying into tech start-ups at what look like historically excessive valuations, does not necessarily end in tears. You just have to make sure it is the right start-ups you are over-paying for."



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Abu Dhabi's Adnoc to Plan IPO of Gas Stations This Year - Bloomberg

Abu Dhabi's Adnoc to Plan IPO of Gas Stations This Year - Bloomberg:

"Abu Dhabi National Oil Co. plans to sell shares in its gas stations unit this year and list them on Abu Dhabi’s stock exchange, according to a person with knowledge of the matter. Goldman Sachs Group Inc., Morgan Stanley and EFG-Hermes are helping to manage the sale, according to two people with knowledge, asking not to be identified because the information is private. Bank of America Corp., Citigroup Inc., HSBC Holdings Plc and First Abu Dhabi Bank PJSC were hired as underwriters, people familiar with the matter said in July. Goldman Sachs, Morgan Stanley and EFG declined to comment. Adnoc said in a statement that it’s considering selling shares in some of its services business, but it didn’t go into more detail. Adnoc Distribution may seek a value of as much as $14 billion, people familiar with the matter said in July. The company has started meeting with investors and analysts, one of the people said."



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Saudi needs Aramco billions as recession slows austerity drive

Saudi needs Aramco billions as recession slows austerity drive:

"Saudi Arabia’s plans to sell state assets - including a stake in energy giant Saudi Aramco - are becoming even more important to its finances as a recession slows Riyadh’s effort to close a budget deficit caused by low oil prices.

Last December, Riyadh released a plan to abolish the deficit by 2020, cutting it from $79 billion (£60 billion) or 12.3 percent of gross domestic product in 2016 via steps such as domestic energy price hikes and tax rises. The plan eased investor fears about Saudi Arabia’s fiscal stability and reduced pressure on its currency.

 But in recent weeks, it has become clear from official statistics that the 2020 target is much too optimistic, economists said. Austerity measures so far have pushed the economy into recession, with GDP shrinking for a second straight quarter in the April-June period.

"



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Saudi Wealth Fund Widens Economic Role With Mortgage Company - Bloomberg

Saudi Wealth Fund Widens Economic Role With Mortgage Company - Bloomberg:

"Saudi Arabia’s sovereign wealth fund is setting up a mortgage refinancing company as it deepens the role it plays in the Arab world’s biggest economy. Saudi Real Estate Refinance aims to refinance 75 billion riyals ($20 billion) in mortgages in five years and more than double that by 2026, the Public Investment Fund said in an emailed statement. The company plans to acquire mortgage portfolios, issue mortgage-backed securities and offer direct and indirect refinancing as it seeks to boost home ownership, it said. “The new company is designed to stimulate housing sector development in the kingdom by injecting liquidity in the real estate market,” the statement said."



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MIDEAST STOCKS-Banks boost Saudi on Riyad earnings, Dubai's DSI jumps

MIDEAST STOCKS-Banks boost Saudi on Riyad earnings, Dubai's DSI jumps:

"Banks led the Saudi Arabian stock market higher on Thursday after Riyad Bank reported better-than-expected earnings for the third quarter, while builder Drake & Scull jumped in Dubai.

Riyad Bank gained 6.2 percent after reporting a 47.7 percent year-on-year rise in third-quarter net profit to 1.08 billion riyals ($288 million); analysts polled by Reuters had on average forecast 852.5 million riyals.

It was one of the first Saudi banks to report quarterly earnings -- Alinma Bank beat analysts’ estimates slightly on Sunday -- so the news buoyed the sector in general. Eleven of 12 listed Saudi banks rose on Thursday."



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Iraq Turmoil Threatens Billions in Oil Traders' Kurd Deals - Bloomberg

Iraq Turmoil Threatens Billions in Oil Traders' Kurd Deals - Bloomberg:

"The crisis unfolding around the Iraqi city of Kirkuk has left some of the world’s largest commodity trading houses worried the country’s autonomous Kurdish region will struggle to repay billions of dollars in cash-for-oil loans.

The approximately $3.5 billion in debts were going to be met with the roughly 500,000 to 600,000 barrels a day of crude that the northern region of Iraq was pumping, according to people familiar with the information, asking not to be named discussing private information. But output has now collapsed to about half that level after the federal government in Baghdad recaptured some oilfields that the Kurds seized in 2014."



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London Stock Exchange CEO Rolet Fires Back at Aramco IPO Critics - Bloomberg

London Stock Exchange CEO Rolet Fires Back at Aramco IPO Critics - Bloomberg:

"London Stock Exchange Group Plc’s Xavier Rolet hit back at criticism that listing rules were bent to pave the way for one of the world’s largest initial public offerings.

The exchange went on a charm offensive after Saudi officials said they are looking to list as much as 5 percent of Aramco in Riyadh plus one or two foreign exchanges. But the 200-member U.K. Investment Association, which represents funds managing more than 5.7 trillion pounds ($7.5 trillion), cried foul, saying that 25 percent should be the minimum free-float level for any premium listed company in the U.K., and that Saudi Aramco should not be an exception.

“There is not a 25 percent governance rule. There’s a liquidity test,” Rolet said in a Bloomberg TV interview Wednesday. “There have been companies that are extremely large that have been allowed to list with less than 25 percent. Let’s not confuse liquidity with governance.”"



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MIDEAST STOCKS-Banks boost Saudi after Riyad Q3 beat, Dubai's DSI surges

MIDEAST STOCKS-Banks boost Saudi after Riyad Q3 beat, Dubai's DSI surges:

"Banks led the Saudi Arabian stock market up early on Thursday after Riyad Bank beat expectations for its earnings, while builder Drake & Scull jumped in Dubai.

Riyad Bank gained 4.0 percent after reporting a 47.7 percent year-on-year rise in third-quarter net profit to 1.08 billion riyals ($288 million); analysts polled by Reuters had on average forecast 852.5 million riyals.

It was one of the first Saudi banks to report quarterly earnings - Alinma Bank beat analysts’ estimates slightly on Sunday - so the news buoyed the sector in general. All eight listed Saudi banks that traded early on Thursday were higher."



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Wednesday, 18 October 2017

Middle Eastern debt boom continues

Middle Eastern debt boom continues:

"The Oil and Gas Holding Company B.S.C., which is fully owned by the kingdom of Bahrain, has sold $1bn of bonds as a rush of unprecedented capital markets borrowing from the Middle Eastern region continues.

The bond came at a yield of 7.5 per cent, and included a special clause which allowed investors to recoup their money at par if the government “ceases to own 100% of the issuer”.

The deal came as Abu Dhabi Crude Oil Pipeline LLC mandated banks to organise investor meetings for a potential bond. The issuer is indirectly wholly owned by ADNOC, Abu Dhabi’s state-owned oil company and one of the largest oil producers in the world."



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UAE can become listings hub for Middle East and Africa - Franklin Templeton - The National

UAE can become listings hub for Middle East and Africa - Franklin Templeton - The National:

"The UAE can become the listings and equities trading hub for the Middle East by "aggressively" reaching out to entice companies in other territories, particularly in Africa, to list on the country's bourses, according to Mark Mobius, the executive chairman of investment firm Templeton Emerging Markets Group. Mr Mobius, who helps oversee the Franklin Templeton’s US$29 billion global emerging markets portfolio, said the UAE has the tax and “numerous other advantage” that should help it lure companies from far and wide. “There are a lot of companies -- you name the country – looking for money, looking for capital," said Mr Mobius in an interview with The National. "[The UAE] is the capital centre and there is a lot of money here.”"



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Riyad Bank third-quarter profit up 47.7%, beats forecasts | ZAWYA MENA Edition

Riyad Bank third-quarter profit up 47.7%, beats forecasts | ZAWYA MENA Edition:

"Riyad Bank , Saudi Arabia's fourth-largest bank by assets, on Wednesday reported a 47.7 percent rise in third-quarter net profit, beating analysts' forecasts as income from investments and fees and commission rose. The bank, which had reported flat or lower profits in nine of the last ten quarters, made 1.08 billion riyals ($288 million) in the three months to Sept. 30, up from 729 million riyals in the same period of 2016, it said in a bourse filing. Three analysts polled by Reuters had on average forecast the bank's quarterly profit would be 852.5 million riyals. "



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Oman Abandons Bidding Process for Third Mobile Phone Operator - Bloomberg

Oman Abandons Bidding Process for Third Mobile Phone Operator - Bloomberg:

"Oman canceled the bidding process to select its third mobile phone operator in favor of a group backed by its wealth funds, a month after delaying a decision on the license. The Gulf state’s third mobile operator will be run by a local company owned by the funds and a “strategic global partner,” state-run Oman News Agency reported on Wednesday. The decision was taken to reinforce the role of wealth funds and have them contribute to economic growth, it said. Oman invited bids for the license earlier this year, eliciting interest from Saudi Telecom Co., Emirates Telecommunications Group, Sudatel Telecom Group and Mobile Telecommunications Co. The decision on a winning bidder was initially due Sept. 4."



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Abu Dhabi state investor Mubadala sets up venture capital arm

Abu Dhabi state investor Mubadala sets up venture capital arm:

"Abu Dhabi’s state fund Mubadala Investment Company said it has launched a venture capital arm that will oversee an early growth fund set up with Japan’s SoftBank, and a fund of funds focusing on emerging fund managers.

A ventures investment team will be based in San Francisco, the first Mubadala office in the United States, it said in a statement on Wednesday.

The team will also oversee and manage Mubadala’s $15 billion commitment to the SoftBank Vision Fund, working in close partnership with SoftBank executives in California."



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MIDEAST STOCKS-Petchems pull down Saudi, Dubai developers active on earnings

MIDEAST STOCKS-Petchems pull down Saudi, Dubai developers active on earnings:

"Petrochemical shares dragged down Saudi Arabia’s stock market on Wednesday while Dubai real estate developers were actively traded after two of them reported third-quarter earnings.

The Saudi index fell 0.7 percent as 12 of 14 listed petrochemical producers dropped, with Yanbu Petrochemical down 1.9 percent.

Most have yet to report third-quarter earnings and will do so in the next few weeks. The biggest producer, Saudi Basic Industries, edged up 0.1 percent, however."



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Qatar’s wealth fund brings $20bn home to ease impact of embargo

Qatar’s wealth fund brings $20bn home to ease impact of embargo:

"Qatar’s sovereign wealth fund has brought more than $20bn back onshore to cushion the impact of a regional embargo imposed on the Gulf state. Ali Shareef al-Emadi, Qatar’s finance minister, told the Financial Times that Qatar Investment Authority deposits were being used to create a “buffer” and provide liquidity in the banking system after the gas-rich state suffered capital outflows of more than $30bn. That followed the decision by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt to cut diplomatic and transport links with the nation in June. The move has triggered the Gulf’s worst crisis in years."



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Will Dubai deals turn into a house of cards?

Will Dubai deals turn into a house of cards?:

"Those who have made a killing on bitcoin this year may be looking for somewhere to deploy their cash winnings. At the time of writing in mid-September, the cryptocurrency was up more than 300 per cent against the dollar since the start of 2017. I would be loath to speculate where it will be by the time you read these words, given its habit of moving 5 per cent or more in a day. For those looking for somewhere less volatile to park their cash, a British underwear tycoon is offering a solution. Michelle Mone, known for her Ultimo bra empire, has apartments in Dubai for sale in the cryptocurrency. “Don’t miss out on the chance to realise your bitcoin gains with a good quality, appreciating asset,” urges the website for the project, Aston Plaza & Residences. The scheme uses the payment processor BitPay to spare bitcoin buyers the inconvenience of converting their digital currency into a regular government-backed currency such as dollars. This helps buyers because the bitcoin exchange market is illiquid and volatile, so such conversions must be carried out gradually over time and might still result in a very different dollar sum to the one the owner of the cash expected."



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Profits — and pitfalls — of a China deal for Saudi Aramco | Arab News

Profits — and pitfalls — of a China deal for Saudi Aramco | Arab News:

"The official position of Saudi Aramco and its advisers has not altered. The initial public offering (IPO) scheduled for 2018 is on track and plans are advancing toward that end, with a number of foreign stock exchanges lined up in addition to the Tadawul as a potential venue.
But behind the scenes, a lot has changed since the Financial Times reported at the end of last week that Aramco was considering a private deal with Chinese investors to take a chunk of its equity before an international IPO.
Since then, further reports have emerged that name two Chinese oil companies, PetroChina and Sinopec, as being part of a consortium that has offered to buy 5 percent of Aramco — exactly the amount slated for the IPO. "



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Qatar emir says open to dialogue to resolve Gulf crisis

Qatar emir says open to dialogue to resolve Gulf crisis:

"Qatar is “open to dialogue” in resolving a dispute that has seen the Gulf state isolated from its Arab neighbors, its emir said during a visit to Indonesia on Wednesday.

Saudi Arabia, the United Arab Emirates, Egypt and Bahrain cut diplomatic and trade ties with Qatar on June 5, accusing it of financing terrorism and maintaining too close of ties to their arch-rival Iran. Doha denies the charges.

Qatari Emir Sheikh Tamim bin Hamad al-Thani said he discussed the issue with President Joko Widodo of Indonesia, which has the world’s largest population of Muslims and has close ties to the Arab world. "



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Saudi Oil Minister Says Full Aramco IPO Is on Track for 2018 - Bloomberg

Saudi Oil Minister Says Full Aramco IPO Is on Track for 2018 - Bloomberg:

"Saudi Arabia is still aiming to complete both international and domestic portions of the initial public offering of its state oil company in 2018, Oil Minister Khalid Al-Falih said Tuesday.

Asked whether both parts of the IPO will happen next year, Al-Falih said: "Yes of course; it is on track." He declined to answer questions on whether Chinese investors were interested in buying ahead of the IPO as cornerstone investors.

People familiar with the situation said last week that the kingdom is wondering whether to delay the international portion of the offering until at least 2019. A two-stage Saudi Aramco IPO is one of several options being considered, they said, asking not to be identified because discussions are private. Another plan would include listing in Riyadh next year and privately selling a stake to one or several cornerstone investors, one of the people said. "



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Qatar's CBQ swings to profit in third quarter | ZAWYA MENA Edition

Qatar's CBQ swings to profit in third quarter | ZAWYA MENA Edition:

"DUBAI - Commercial Bank of Qatar (CBQ), the Gulf Arab state's third-largest lender by assets, swung to a third-quarter net profit on Wednesday but missed analysts' average forecasts. CBQ reported net profit of 79.4 million riyals ($21.8 million) in the three months to Sept. 30. That compares with a net loss of 1.0 million riyals in the same period a year earlier. The average of three analysts polled by Reuters had forecast CBQ would make a quarterly profit of 88.5 million riyals. "



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Dubai's DAMAC Properties third-quarter profit down 20% | ZAWYA MENA Edition

Dubai's DAMAC Properties third-quarter profit down 20% | ZAWYA MENA Edition:

"Dubai's DAMAC Properties , the owner and operator of the only Trump-branded golf club in the Middle East, reported a third consecutive profit decline on Wednesday as costs of sales rose. The developer's profit fell 20 percent in the July-September period to 719.34 million dirhams ($195.86 million) compared with the same quarter a year prior when it reported a 902 million dirham profit. Revenue rose by 31 percent to 2.29 billion dirhams, and the cost of sales increased to 1.3 billion dirhams, from 788.6 billion in the year-earlier period. "



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MIDEAST STOCKS-Petchems drag down Saudi, Dubai developers in focus | ZAWYA MENA Edition

MIDEAST STOCKS-Petchems drag down Saudi, Dubai developers in focus | ZAWYA MENA Edition:

"Petrochemical shares dragged down Saudi Arabia's stock market in early trade on Wednesday while Dubai real estate developers traded actively after they reported third-quarter earnings.

The Saudi index fell 0.6 percent in the first half-hour as Saudi Basic Industries sank 1.8 percent and Yanbu Petrochemical dropped 1.4 percent.

Insurer Malath, which had surged its 10 percent daily limit on Tuesday after trading in its rights issue ended, jumped a further 10 percent. "



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Tuesday, 17 October 2017

Qatar National Bank's 2017 loan growth to rise 12-14 pct -analysts

Qatar National Bank's 2017 loan growth to rise 12-14 pct -analysts:

"Qatar National Bank (QNB), the largest lender in the Middle East and Africa by assets, expects loan growth of 12-14 percent this year, propelled by government infrastructure spending, analysts said after a call with QNB’s finance chief.

The country’s banking sector has had to contend with fallout from a June decision by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt to cut diplomatic and transport ties with Qatar, though the Qatari government has shown little sign of weakening its commitment to spending on infrastructure projects.

QNB expects net profit growth of 6-8 percent for 2017 and for 2018, analysts said after an investor relations conference call with QNB Chief Financial Officer Ramzi Mari."



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Abu Dhabi bourse starts technical short-selling to boost liquidity | ZAWYA MENA Edition

Abu Dhabi bourse starts technical short-selling to boost liquidity | ZAWYA MENA Edition:

"The Abu Dhabi Securities Exchange said on Tuesday it was introducing technical short-selling in an effort to increase liquidity in the stock market and attract more foreign investors.

In short-selling, investors sell stocks they do not own to profit if prices have dropped when the trades are settled. In the exchange's technical short-selling system, trades are settled within two business days, with short-sellers depositing an initial margin worth 50 percent of the shares' market value.

Several rules seek to reduce volatility and risk in the system, such as a trading suspension if a stock drops 5 percent, or if the proportion of a company's capital sold short reaches 10 percent. "



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Abu Dhabi’s ADNOC to sell $3 bln debut bond as soon as this week -sources

Abu Dhabi’s ADNOC to sell $3 bln debut bond as soon as this week -sources:

"Abu Dhabi National Oil Co (ADNOC) is expected to issue as early as this week a project bond in the region of $3 billion, in what would be the United Arab Emirates oil major’s first public debt issue, sources familiar with the matter said on Tuesday.

The bond, with a maturity longer than 10 years, would be sold by one of ADNOC’s subsidiaries, not by the holding company.

State-owned ADNOC, which manages almost all the proven oil reserves in the UAE, has mandated banks including Bank of Tokyo-Mitsubishi, First Abu Dhabi Bank, HSBC and JP Morgan to arrange the debt sale, said the sources."



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Fight for Iraq's Future Targets 90-Year-Old Kirkuk Oil Field - Bloomberg

Fight for Iraq's Future Targets 90-Year-Old Kirkuk Oil Field - Bloomberg:

"The latest battle for Iraq’s future is unfolding around the country’s oldest oil field.

Federal government troops on Tuesday took control of all the crude deposits in the Kirkuk area after pushing back forces from the semi-autonomous Kurdish region with a rapid thrust into the province in northern Iraq. The fighting broke a stand-off over the long-disputed area.

Baghdad wants to reassert control of the area’s oil deposits from Kurdish fighters, who seized the territory and its capital city, also called Kirkuk, to ward off Islamic State militants in 2014. The Kurds, who voted overwhelmingly for independence in a referendum last month, see the resources as a financial lifeline for a future state."



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MIDEAST STOCKS-Gulf mixed, insurers help Saudi Arabia

MIDEAST STOCKS-Gulf mixed, insurers help Saudi Arabia:

"Gulf stock markets were mixed despite strong oil prices on Tuesday while Saudi Arabia’s insurance sector continued to recover from last week’s losses.

The main Saudi index inched up 0.2 percent. In the insurance sector, which sank last week on expectations for a shakeout in the sector caused by tougher regulation, Malath Insurance surged 9.9 percent after the trading period for its rights issue ended, while Metlife AIG ANB jumped 3.6 percent.

Banks were mixed. Alinma Bank, which had risen 2.3 percent on Monday after it reported better-than-expected earnings, fell back 0.3 percent. But Riyad Bank edged up 0.8 percent while Alawwal Bank gained 2.1 percent."



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Mashreq Q3 profits up 35% on lower impairments  - The National

Mashreq Q3 profits up 35% on lower impairments  - The National:

"Mashreq, the Dubai-based lender, said third-quarter profit rose 35 per cent, boosted by gains in net interest income, fees and commissions and a drop in money set aside to cover bad debt. The bank's profits for the three months to the end of September increased to Dh561 million from Dh415m in the corresponding period last year, the bank said on Tuesday, as impairment allowances decreased 44 per cent to Dh265m. Net interest income and income from Islamic financing advanced 3.9 per cent to Dh910m compared with Dh876m in the same quarter last year, while fees and commissions grew 3.8 per cent to Dh414m compared with Dh399m over the same period."



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Nasdaq Dubai inks derivatives deal with MSCI | GulfNews.com

Nasdaq Dubai inks derivatives deal with MSCI | GulfNews.com:

"Nasdaq Dubai has signed a licence agreement with index provider MSCI to create derivative products that will be traded on the Nasdaq Dubai derivatives platform.
The exchange initially plans to develop futures contracts based on the MSCI UAE Index, which is widely tracked by international institutional investors, the bourse said in an emailed statement on Tuesday.

The development is significant in the light of the growing importance of the region as an attractive investment destination for international investors seeking exposure to high-growth emerging markets such as the UAE."



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Are Saudi equities ready to go mainstream? | ZAWYA MENA Edition

Are Saudi equities ready to go mainstream? | ZAWYA MENA Edition:

"Many will find it a bit of a mystery that Saudi equities still do not form part of the most important international benchmarks. Despite solid macro-economic credentials, a market that has outperformed emerging and global equities for the past 20 years is still kept out by major index providers. If you buy a global equities ETF or index fund today, whether it has exposure to emerging markets, developed markets or otherwise, the chances are that you will have no direct investment in Saudi Arabia. This can seem somewhat odd as the Saudi market has a number of things going for it. It is large, representing between 40 and 60 per cent of the total available market capitalisation in the region, depending on index methodology. It is also liquid with an average daily volume above $1 billion over the past year, although this is a number that used to be significantly higher in previous years. It also counts some of the most important companies in the region: of the top 20 regional companies, 13 are from Saudi Arabia. Any investor seeking to find diversification opportunities by going global should seriously consider including this market in their investment universe. However, index providers have previously been held back by accessibility issues because of significant restrictions on foreign investors. Although it was possible to find a way into the Saudi market via derivatives, little progress was made on direct access until the Capital Market Authority decided to introduce the Qualified Foreign Investor (QFI) programme in 2015. Even then, there were a number of specific criteria to fulfil before an institution could gain full access to the cash market."



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Saudi Aramco asks FTI Consulting to halt IPO investor relations work: sources

Saudi Aramco asks FTI Consulting to halt IPO investor relations work: sources:

"State-owned Saudi Aramco has asked FTI Consulting (FCN.N) to suspend its investor relations advisory work related to the oil company’s planned initial public offering, people familiar with the matter told Reuters.

Aramco brought in Brunswick to advice on media relations and appointed FTI Consulting to manage investor relations.

It was not immediately clear why FTI was asked to suspend its work for Aramco, but one of the sources said the latest decision could broaden Brunswick’s role beyond media relations."



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Qatari Banks Are Said to Cut Dollar Sales to Foreign Lenders - Bloomberg

Qatari Banks Are Said to Cut Dollar Sales to Foreign Lenders - Bloomberg:

"Some Qatari banks are becoming less willing to sell dollars to foreign lenders amid a lingering regional standoff with a Saudi-led alliance, according to people familiar with the matter.

Foreign exchange activity between local and international banks is almost at a standstill, the people said, asking not to be identified because the matter is private. The central bank is still providing dollars to local lenders to meet domestic business needs at the pegged rate of 3.64 riyals per dollar, they said.

To get dollars to fund imports and other commercial activities for local clients, foreign banks are using the offshore market to buy the U.S. currency at a higher rate and may have to pass these costs on to clients, some of whom are in Qatar, the people said. The Qatari riyal fell as low as 3.80 versus the dollar in the offshore market on Monday, the lowest since 1988, according to data compiled by Bloomberg."



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MIDEAST STOCKS-Gulf flat to lower in early trade, Saudi banks hold up

MIDEAST STOCKS-Gulf flat to lower in early trade, Saudi banks hold up:

"Most Gulf stock markets were flat to lower in early trade on Tuesday with Saudi Arabia’s banking and insurance sectors holding up after their rebound the previous day. The main Saudi index was flat after the first hour. Most Saudi banks edged up though Alinma Bank, which had jumped 2.3 percent in heavy trade on Monday after it reported better-than-expected earnings, fell back 0.2 percent. Malath Insurance surged 9.9 percent after the trading period for its rights issue ended on Monday. Another insurer, Metlife AIG ANB, jumped 4.5 percent."



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Monday, 16 October 2017

Saudi Aramco: a blow for Mohammed bin Salman

Mideast benefits as investors look further afield

Mideast benefits as investors look further afield:

"As investors brace themselves for a shift in monetary policy across developed markets and trillions of euros of debt still trade at negative yields, it is no surprise that many have looked further afield for returns this year.

Middle Eastern countries, in particular, have been big beneficiaries of a hunt for yield, with the region selling by far the largest annual volume of sovereign and local authority debt on record.

While these bonds have typically been denominated in dollars, to which Middle Eastern currencies are pegged, some investors point to the attractiveness of local currency bonds as a means of further boosting fixed income returns."



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Why Kurdish Oil Is a Wild Card for Markets - Bloomberg

Why Kurdish Oil Is a Wild Card for Markets - Bloomberg:

"If Iraq’s Kurdish territory were a country, it would probably qualify for OPEC membership. It wouldn’t even be the smallest member, given its production of more than half a million barrels of oil a day. That’s an impressive achievement for a landlocked enclave that started exploring only a decade ago. The region’s potential is greater still, though it faces political, military and economic challenges to expanding its output.

Tensions over a Sept. 25 independence referendum in the semi-autonomous oil province have flared into open conflict between the federal authorities and the Kurdistan Regional Government. The KRG included the disputed oil-rich territory of Kirkuk in the vote, prompting clashes between troops from both sides and an Iraqi military thrust to seize oil facilities from Kurdish forces.

"



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Dubai Holding sidelines $20 billion property project

Dubai Holding sidelines $20 billion property project:

"Dubai Holding has put on hold plans to develop Jumeirah Central, its $20 billion office, retail and residential project in the heart of Dubai, it said on Monday. “Dubai Holding is prioritizing projects that will be ready for Expo 2020 Dubai and those that will help draw tourists to the emirate. As a result, we are currently focusing our resources on projects such as Marsa Al Arab,” it said. Dubai is hoping to attract 20 million visitors a year by 2020 when it will host the World Expo 2020 exhibition."



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Exclusive: China offers to buy 5 percent of Saudi Aramco directly - sources

Exclusive: China offers to buy 5 percent of Saudi Aramco directly - sources:

"China is offering to buy up to 5 percent of Saudi Aramco directly, sources said, a move that could give Saudi Arabia the flexibility to consider various options for its plan to float the world’s biggest oil producer on the stock market.

Chinese state-owned oil companies PetroChina (0857.HK) and Sinopec (0386.HK) have written to Saudi Aramco in recent weeks to express an interest in a direct deal, industry sources told Reuters. The companies are part of a state-run consortium including China’s sovereign wealth fund, the sources say.

Saudi Arabia’s Crown Prince Mohammed bin Salman said last year the kingdom was considering listing about 5 percent of Aramco in 2018 in a deal that could raise $100 billion, if the company is valued at about $2 trillion as hoped."



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Saudi Arabia Needs Lots of Private Oil Money - Bloomberg Gadfly

Saudi Arabia Needs Lots of Private Oil Money - Bloomberg Gadfly:

"Saudi Arabia is considering a staggered process for the colossal initial public offering of its state oil company, according to an FT report. That could potentially involve a local IPO of Saudi Aramco in Riyadh alongside a private placement to cornerstone investors, with an international sale following later.ARAMCO MOOTED VALUE$2 trillionWhatever structure Aramco opts for, the sheer size of the offering means shareholders taking hefty stakes would have to be an essential part of its privatization. This was always going to be an IPO roadshow taking in the world's richest individuals and institutions.Saudi Arabia is considering selling about 5 percent of the company. At the mooted -- but contested -- $2 trillion valuation, that would imply a stock offering of at least $100 billion. This is about half of the natural demand for global IPOs based on recent figures. In the past 12 months, $206 billion of stock was sold in new issues, including $95 billion of new stock sales in Asia, $52 billion in Europe and $43 billion in the U.S, Bloomberg data show."



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MIDEAST STOCKS-Saudi market rebounds on banks, oil prices

MIDEAST STOCKS-Saudi market rebounds on banks, oil prices:

"Saudi Arabia’s stock market rebounded on Monday as higher oil prices boosted petrochemical shares while banks rose in response to Alinma Bank’s better-than-expected earnings. The main Saudi index gained 0.6 percent as tensions between Baghdad and Iraqi Kurdistan lifted oil sharply. PetroRabigh rose 2.1 percent and Petrochem added 1.2 percent, while mining firm Ma‘aden was up 2.1 percent. Alinma Bank jumped 5.1 percent and was the most heavily traded stock; it reported third-quarter net profit of 542 million riyals ($145 million), up from 312 million riyals a year ago. Analysts had on average forecast 493 million riyals."



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Dubai Aerospace plans sukuk issue by mid-2018

Dubai Aerospace plans sukuk issue by mid-2018:

"Dubai Aerospace Enterprise (DAE) intends to tap the Islamic bond market within the next nine months as part of a strategy to diversify the company’s funding, its chief executive said on Monday. The Dubai government-controlled company became one of the world’s largest aircraft lessors in August after acquiring Dublin-based AWAS. DAE Chief Executive Firoz Tarapore told Reuters that the company intended to issue a sukuk “very soon”. Asked if that could take place by the middle of 2018, Tarapore answered “most definitely.”"



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Abu Dhabi Investment Authority's unit to invest $1bln in India's infra fund | ZAWYA MENA Edition

Abu Dhabi Investment Authority's unit to invest $1bln in India's infra fund | ZAWYA MENA Edition:

"MUMBAI- India's National Investment and Infrastructure Fund (NIIF) on Monday said it signed a $1 billion investment deal with a unit of Abu Dhabi Investment Authority (ADIA) - one of the largest sovereign wealth funds in the world.

NIIF, a quasi-sovereign wealth fund, said ADIA will become the first institutional investor in its master fund.

The corpus of NIIF, created by the Indian government to boost infrastructure financing, is proposed to be about $6 billion, with a 49 percent investment from the government. "



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MIDEAST STOCKS-Gulf markets firm, Saudi rises on banks | ZAWYA MENA Edition

MIDEAST STOCKS-Gulf markets firm, Saudi rises on banks | ZAWYA MENA Edition:

"Most Gulf stock markets were firm in early trade on Monday with Saudi Arabia recovering from Sunday's losses as the banking sector rose on Alinma Bank's better-than-expected earnings. The main Saudi index edged up 0.2 percent in the first hour. Alinma Bank jumped 2.3 percent and was the most heavily traded stock; it reported third-quarter net profit of 542 million riyals ($145 million), up from 312 million riyals a year ago. Analysts had forecast an average of 493 million riyals. Other Saudi banks, which have yet to report earnings, were generally firm; Al Rajhi Bank was up 0.6 percent. "



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Aramco exposes Gulf in governance rhetoric | FT Alphaville

Aramco exposes Gulf in governance rhetoric | FT Alphaville:

"Aramco exposes Gulf in governance rhetoric. FT Opening Quote, with commentary by Matthew Vincent, is your early Square Mile briefing. You can sign up for the full newsletter here.

News that Saudi Aramco, the Gulf state’s $1tn oil company, may postpone plans for an international listing of its shares – and instead sell a stake to sovereign wealth funds – is a tad embarrassing for Theresa May.

It not only makes her April trip to lobby the Saudi’s for a London listing – taking stock exchange boss Xavier Rolet – look like a waste of time. It also suggests she may have compromised her position as First Lord of the Treasury and Grand Upholder of the Corporate Governance Standards for nothing."



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Aramco confirms IPO on track for 2018 - The National

Aramco confirms IPO on track for 2018 - The National:

"Saudi Aramco, the world’s largest energy company, has confirmed its record-breaking public listing is on track for next year, dismissing media reports it was considering abandoning the process.

The Financial Times reported on Friday that Aramco was considering “shelving” its 2018 listing of approximately 5 per cent of its shares, a sale that is expected to raise about US100 billion, in favour of a private placement to sovereign wealth funds and institutional investors.

“[The] FT report on Saudi Aramco IPO is entirely speculative,” the company said in a statement on Twitter on Sunday."



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Saudi Arabia’s Great Makeover Can’t Afford to Fail This Time - Bloomberg

Saudi Arabia’s Great Makeover Can’t Afford to Fail This Time - Bloomberg:

"Visitors to Saudi Arabia could be forgiven for thinking the country just got a dynamic young new king. Images of him holding babies, drinking coffee with soldiers or meeting the world’s most powerful rulers are all over television. On National Day last month, a giant picture of him was projected onto a Riyadh skyscraper. Crown Prince Mohammed bin Salman, 32, has emerged as the unrivaled leader of the kingdom, now better placed to steer it through a transition no nation in history has managed to pull off: converting a major economy reliant on petrodollars into one that can survive in a post-oil 21st century.  The grand remake involves investing in new industries and creating jobs for the young Saudi population. It will all be underpinned by the sale of a stake in oil giant Aramco, which is now facing possible delay, and the creation of the world’s biggest sovereign wealth fund."



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Oil jumps on fears of new Iran sanctions, Iraq conflict

Oil jumps on fears of new Iran sanctions, Iraq conflict:

"Oil markets jumped on Monday on concerns over potential renewed U.S. sanctions against Iran as well as conflict in Iraq, while an explosion at a U.S. oil rig and reduced exploration activity supported prices there.

International Brent crude futures LCOc1 were at $57.82 at 0645 GMT, up 65 cents, or 1.1 percent, from the previous close.

Prices were being pushed up by worries over renewed U.S. sanctions against Iran. "



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Saudi Wealth Fund Said to Hire Development Head From Qatari Diar - Bloomberg

Saudi Wealth Fund Said to Hire Development Head From Qatari Diar - Bloomberg:

"Saudi Arabia’s sovereign wealth fund hired the head of Qatar Investment Authority’s real estate arm as its chief development officer earlier this year amid plans to invest billions of dollars in tourism and property projects, according to people familiar with the matter. Greg Bankhurst, formerly chief executive officer of Qatari Diar, joined the Public Investment Fund, the people said, asking not to be identified as the information is private. Bankhurst started working at the fund in June, according to his LinkedIn profile. Jayson Miragliotta also joined as executive director of master planning in August, the people said. He previously held roles at Dubai-based Emaar Properties PJSC and Majid Al Futtaim, according to Miragliotta’s LinkedIn profile."



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Sunday, 15 October 2017

Dubai Holding 're-evaluating' Jumeirah Central, insists project will continue - The National

Dubai Holding 're-evaluating' Jumeirah Central, insists project will continue - The National:

"Dubai Holding, one of the emirate’s three big conglomerates, is “re-evaluating” its 47 million square feet Jumeirah Central residential and office development on the Sheikh Zayed Road “to meet expected future demand”. The company said it remains committed to the overall project. The developer said yesterday its changing priorities for the development, unveiled at last year’s Cityscape Global exhibition, have prompted a restructuring of its upper management, with chief operating officer Morgan Parker due to leave the company in the next three months. “Dubai Holding is prioritising projects that will be ready for Expo 2020 Dubai and those that will help draw tourists to the Emirate," a Dubai Holding spokesperson said on Sunday."



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GCC-wide VAT implementation likely to be delayed, IMF official says - The National

GCC-wide VAT implementation likely to be delayed, IMF official says - The National:

"The implementation of GCC-wide value-added tax could be delayed due coordination and preparatory work requirements needed to introduce the 5 per cent tariff at the beginning 2018, an IMF official said. All Arabian Gulf countries have committed to implement the Unified Agreement for Value Added Tax, but nations are moving at different paces of implementation, raising doubt about the possibility of a harmonious introduction of the levy. According to PwC each GCC state establishes its own separate national legislation with detailed compliance requirements and rules outlined in each respective legislation “We are sceptical about whether this (implementation of VAT in the first quarter of next year) can be achieved in the sense that the preparatory and coordination work may not be completed on time,” said Abdelhak Senhadji, deputy director of the fiscal affairs department at the IMF in an interview."



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Dubai Investment Week 2017 opens with FDI leadership workshop | GulfNews.com

Dubai Investment Week 2017 opens with FDI leadership workshop | GulfNews.com:

"The “Dubai Investment Week 2017”, organised by the Dubai Investment Development Agency (Dubai FDI), an agency of Dubai Economy, under the patronage of Shaikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai, got off to a start on Sunday with an FDI Leadership Training Workshop on “Industrial FDI: Trends & Opportunities”. The workshop was attended by over 100 professionals working in the development, promotion, and facilitation of foreign investment across government entities and free zones in Dubai as well as partner entities of Dubai FDI. Fahad Al Gergawi, CEO of Dubai FDI opened the workshop, following which Dr Abdul Aziz Istaitieh, Senior Economic Advisor to the Executive Council of Dubai, gave an overview and performance update on the Dubai Industrial Strategy launched last year by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. "



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There is more to health care than building new hospitals | GulfNews.com

There is more to health care than building new hospitals | GulfNews.com:

"For the UAE’s leading health care companies, building new hospitals needn’t be their only plan of action. They can just as easily take on the operation and management (O&M) of existing health care assets owned by others. And that can prove quite a revenue generating option, according to Abu Dhabi headquartered NMC Health. NMC Health is now aiming for full-year O&M revenues of Dh69.7 million, and a figure boosted by its recent deal with Emirates Healthcare, which operates a network of hospitals and specialised clinics in the UAE. “We feel the O&M business provides a great opportunity for NMC to expand our footprint across the GCC,” said Prasanth Manghat, CEO and executive director at NMC Health. “We have been able to enter into O&M agreements that have provided strong corporate operational, financial, and back-office support and relieved the burden of having to go out and recruit talent. We do it because the relationships we have entered into have been mutually beneficial for NMC and for our partners.”"



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Kurdish Oil Keeps Flowing Despite Baghdad's Threats Over Kirkuk - Bloomberg

Kurdish Oil Keeps Flowing Despite Baghdad's Threats Over Kirkuk - Bloomberg:

"Oil flowed normally from fields in northern Iraq even as government troops and allied militias faced off with forces from the independence-seeking Kurdish region on the outskirts of the disputed area of Kirkuk. Exports of about 600,000 barrels a day of crude from Kirkuk’s oil fields and from deposits inside the adjacent Kurdish region continued as usual through a Kurd-controlled pipeline to Turkey, according to a person familiar with the matter, asking not to be identified because the information is private. The shipments from Kirkuk combine crude pumped by Iraq’s state-owned North Oil Co. and by the Kurdistan Regional Government, and both flows are normal, Kirkuk Governor Najmaddin Kareem said Sunday. Kirkuk, home to Iraq’s oldest-producing oil fields, has emerged as a potential flashpoint of conflict between the country’s federal government in Baghdad and the semi-autonomous KRG. Iraq is the second-largest OPEC producer, pumping most of its 4.47 million barrels a day from fields in the south and shipping it from the Persian Gulf port of Basra. But with Iraq supplying about 14 percent of total production from the Organization of Petroleum Exporting Countries, a conflict centered in the country’s north could have an immediate impact on oil markets."



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Qatar National Bank aims to refinance $3 bln loan by year-end –sources

Qatar National Bank aims to refinance $3 bln loan by year-end –sources:

"Qatar National Bank, the largest Gulf Arab bank, has approached commercial banks for the refinancing of a $3 billion loan due next March, saying it would like to complete the deal before the end of 2017, sources familiar with the matter said. The refinancing could force foreign banks to make difficult decisions as they seek to avoid choosing sides in the diplomatic crisis between Qatar and its Gulf neighbours. Some banks with operations on both sides are trying to maintain existing relationships with Qatari borrowers. But they would prefer not to be seen lending to Qatar for fear of disrupting their existing relationships with clients in Saudi Arabia, the United Arab Emirates and Bahrain."



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MIDEAST STOCKS-Saudi falls, most markets trade narrowly

MIDEAST STOCKS-Saudi falls, most markets trade narrowly:

"Most Middle East stock markets traded in narrow ranges on Sunday while Saudi Arabia was dragged down by several major blue chips.

The Saudi index dropped 0.7 percent as Al Rajhi Bank lost 1.0 percent and miner Ma‘aden sank 1.9 percent. Petrochemical producer Saudi Basic Industries fell 0.7 percent.

Insurers were roughly evenly split between gainers and losers after they tumbled last week on expectations for a shakeout in the sector caused by tougher regulation. Amana Insurance, which had plunged 14.9 percent last week, surged 5.8 percent in unusually heavy trade."



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UAE banks set for resilient third quarter results | GulfNews.com

UAE banks set for resilient third quarter results | GulfNews.com:

"The UAE banking sector performance is expected to be resilient in the third quarter of this year despite a slowdown in economic growth resulting in modest balance sheet growth across the banking sector. Analysts expect no major surprises except the broad trend of modest margin growth largely from loan repricing because of higher interest rates and improving cost structure. UAE banks in general have reported resilient earnings in the second quarter. Earnings benefited from an improvement in credit cost, as well as modest loan growth. Margins were slightly compressed year-on-year, but have improved since the start of this year, thanks to two rate hikes in 2017. Banks continue to put a lid on cost growth, further supporting profitability."



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High Noon.com: Battle for Saudi e-commerce market begins

High Noon.com: Battle for Saudi e-commerce market begins:

"In Saudi Arabia, a kingdom where postal codes are rarely used, most people pay in cash, and shopping is done in giant air-conditioned malls, building an online retail business is no easy task.

But two powerfully-backed companies are trying to do just that, betting a young, tech-savvy population will eventually deliver up a large slice of the Arab world’s largest consumer market.

After months of delays, Noon.com launched in the United Arab Emirates (UAE) on Oct. 1 and said it would enter the Saudi market “within the coming weeks.”"



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Iran's a Distraction. The Urgent Problem Is Kurdish Oil - Bloomberg Gadfly

Iran's a Distraction. The Urgent Problem Is Kurdish Oil - Bloomberg Gadfly:

"The drama around President Donald Trump and Iran's compliance with the nuclear deal has grabbed the oil world's attention. This gaze should shift west. Rising tensions in northern Iraq could have a much more immediate impact on oil flows that could lead prices higher, and squeeze producers and refiners.The collapse of so-called Islamic State in Iraq ought to be a cause for celebration and national renewal. Instead, it has dragged the country to the brink of a civil war that, on top of the unnecessary human suffering, could cause the loss of more than half a million barrels a day of exports.The ousting of insurgents from their last strongholds in northern Iraq has brought the Iraqi military and Iranian-backed militias into direct contact with forces loyal to the Kurdish Regional Government in the oil fields around Kirkuk. Although these produce much less than the fields in the south of the country they are nonetheless important, both economically and strategically, to the Kurdish and Baghdad governments alike."



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Saudi Wealth Fund Builds $2.4 Billion Stake in Food Producer - Bloomberg

Saudi Wealth Fund Builds $2.4 Billion Stake in Food Producer - Bloomberg:

"Saudi Arabia’s sovereign wealth fund became the third-biggest shareholder in Almarai Co. as it boosts investments at home and abroad.

The Public Investment Fund owns 163.2 million shares, or 16.32 percent, of Riyadh-based dairy farm operator and food processor, according to a regulatory filing that didn’t disclose the identity of the seller. The stake is valued at about 9 billion riyals ($2.4 billion) based on Oct. 12 closing prices, according to data compiled by Bloomberg."



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UPDATE 1-Saudi may raise loan-deposit ratio if needed, c.bank chief tells Arabiya

UPDATE 1-Saudi may raise loan-deposit ratio if needed, c.bank chief tells Arabiya:

"Saudi Arabia’s central bank may raise the maximum loan-to-deposit ratio for commercial banks if that is needed to help the economy, central bank governor Ahmed al-Kholifey told Al Arabiya television. Kholifey was speaking on the sidelines of meetings of the International Monetary Fund and the World Bank in Washington at the weekend. The central bank last raised the ratio in February 2016, to 90 percent from 85 percent. The ratio for the banking sector as a whole stood at 81.7 percent in August, down from 84.8 percent a year ago, according to the latest central bank data."



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Qatar deflation deepens as real estate market weakens

Qatar deflation deepens as real estate market weakens:

"Qatar’s consumer price deflation deepened in September as a downturn in the real estate market deepened because of economic sanctions imposed by other Arab states, official data showed on Saturday.

Consumer prices fell 0.5 percent from a year earlier last month, after a 0.4 percent drop in August that was the first fall since at least early 2015, when the current data series began.

Housing and utility prices sank 4.7 percent from a year ago in September, their biggest drop for at least several years, and fell 0.7 percent from the previous month. In August, prices had slipped 4.0 percent from a year earlier."



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Mideast stocks: Gulf marginally firmer in early trade | ZAWYA MENA Edition

Mideast stocks: Gulf marginally firmer in early trade | ZAWYA MENA Edition:

"Gulf stock markets were marginally firmer in early trade on Sunday with most Saudi Arabian insurance company shares continuing to rebound from sharp losses last week.

The main Saudi stock index.TASI edged up 0.02 percent in the first hour. Amana Insurance, which had plunged 14.9 percent last week on expectations for a shakeout in the sector caused by tougher regulation, surged 6.6 percent.

Food company Almarai 2280.SE rose 2.9 percent after saying the Public Investment Fund, the main Saudi sovereign wealth fund, had retained a 16.3 percent stake in the company after a 25 percent capital increase through an issue of bonus shares. "



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Saturday, 14 October 2017

This time, the Gulf IPO wave looks likely to make it ashore | Arab News

This time, the Gulf IPO wave looks likely to make it ashore | Arab News:

"Gulf markets are braced for a wave of initial public offerings (IPOs). I wish I’d had a dollar for every time I have read that, or indeed written it. But — maybe, just maybe — this time the prospect of a rush to market by Gulf corporates will actually come to pass. All the signals are set to green. Global equity markets are at all time highs, there is still no sign of an imminent leap in interest rates to get global bond markets soaring again, and asset valuations are at the kind of levels where owners must surely be tempted to cash in. In the Gulf, equity markets have been prevented from joining in the global shares party by concerns about the economic effect of the oil price — still the region’s most important indicator. But neither have they collapsed. Equities have actually held value more than crude since the summer of 2014."



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London court adjourns Dana Gas sukuk trial

London court adjourns Dana Gas sukuk trial:

"A London High Court judge has adjourned hearings on whether the United Arab Emirates’ Dana Gas must redeem $700 million of Islamic bonds when they mature at the end of this month, sources familiar with the matter said on Friday. High Court judge George Leggatt is expected to resume the hearings by Nov. 13, the sources said. In a complex case that is being fought in British and UAE courts, Dana is refusing to make payments on the sukuk on the grounds that changes in Islamic finance over recent years have made the bonds unlawful in the UAE."



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Saudi Aramco in stake sale talks with Chinese investor: sources

Saudi Aramco in stake sale talks with Chinese investor: sources:

"Saudi Aramco is considering the sale of a stake to a Chinese investor as plans for its highly-anticipated international public offering are pushed beyond its 2018 target, sources familiar with the matter said on Friday.

The initial public offering is expected to be the world’s largest stock sale, and is a key component of the Saudi government’s economic reform program which aims to diversify the desert kingdom away from its reliance on oil exports.

A private placement of shares in the state oil company to a Chinese investor is being evaluated as a precursor to the international IPO, according to two sources who spoke on condition of anonymity as the information was not public."



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Aramco and the Risks of a Potemkin IPO - Bloomberg Gadfly

Aramco and the Risks of a Potemkin IPO - Bloomberg Gadfly:

"I know Saudi Arabia has been cozying up to Russia recently, but a Potemkin IPO of Saudi Aramco would be taking things a bit too far.After rumors of a delay to the international stock-market debut of Saudi Arabian Oil Co. surfaced last month, more appeared on Friday afternoon.However, another path Saudi Arabia is considering is to sell a stake in Aramco privately to a handful of foreign, sovereign investors, the Financial Times first reported. This could involve straight equity or possibly a convertible bond, according to Bloomberg News, alongside a domestic listing. An international listing might follow at some point."



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Friday, 13 October 2017

Saudi privatisations prove a magnet for foreign banks

Saudi privatisations prove a magnet for foreign banks:

"For some banks beating a path to Saudi Arabia for the nation’s privatisation bonanza, the bounty is more than just a quick payday. They are hoping for salvation in a region that has served up more than its fair share of challenges. 

Saudi Arabia became irresistible for global banks after it last year announced plans to sell off swaths of prized assets, including what is likely to be the world’s biggest initial public offering with the sale of part of oil company Saudi Aramco. 

A modern-day gold rush ensued as top dealmakers jetted into Riyadh to vie for Saudi Aramco’s business and the many projects that were to follow from the Saudi Vision 2030 plan to reshape the nation’s finances to deal with lower oil prices. "



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Qatar escalates UAE trade dispute, asks WTO to adjudicate

Qatar escalates UAE trade dispute, asks WTO to adjudicate:

"Qatar has asked the World Trade Organization to set up a dispute panel to adjudicate on its row with the United Arab Emirates, Qatar said in a document published by the WTO on Thursday, escalating a trade complaint it lodged with the WTO in July.

The initial complaint, which also included Bahrain and Saudi Arabia, triggered a 60-day window to settle the issue in talks without entering years of litigation.

But on Aug 10, Qatar received a communication from the chairman of the WTO’s dispute settlement body stating that the UAE would not engage in consultations with Qatar, the Qatari submission to the WTO said."



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Saudi Aramco considers shelving international IPO

Saudi Aramco considers shelving international IPO:

"Saudi Aramco is considering shelving plans for an international listing in favour of a private share sale to the world’s biggest sovereign wealth funds and institutional investors.

Talks about a private sale to foreign governments including China and other investors have gathered pace in recent weeks, according to five people familiar with the initial public offering preparations, amid growing concerns about the feasibility of an international listing.

The Saudi state oil company has struggled to select a suitable international venue for its shares, as New York and London have vied for what has been billed as the largest ever flotation."



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Gulf banks ‘ripe for consolidation’ following FAB deal

Gulf banks ‘ripe for consolidation’ following FAB deal:

"When Abu Dhabi’s two biggest banks announced their $29bn “merger of equals” last year, the implications were more significant than just for the fortunes of the optimistically named FAB, or First Abu Dhabi Bank.  The bigger question was whether the merger of National Bank of Abu Dhabi and First Gulf Bank would spark a wave of consolidation for the more than 100 banks in the Gulf Cooperation Council (GCC) region. Opinions are divided as to whether FAB will be a catalyst for regional consolidation or a false dawn like the 2007 merger of Emirates and National Bank of Dubai.  “People saw Emirates NBD as the trigger for one of the biggest bank consolidations in Emea [Europe, the Middle East and Africa],” says one Dubai-based investment banker, who did not want to be named. “That was a very big mistake.” "



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State stakes in Gulf banks bring business advantages — and risks

State stakes in Gulf banks bring business advantages — and risks:

"In Europe and the US, state ownership of banks has been a painful experience. When they have been forced into each others’ arms by crises and bailouts, shame and blame are often inescapable, as are conflicts over whether rescued banks should be engines of government policy and social good or pursue maximum profits.

In the Gulf, state-owned banks have a much more harmonious relationship with governments. “Having the biggest banks in the Gulf Co-operation Council [GCC] mostly owned by their respective governments and/or ruling families certainly grants them a major competitive advantage,” says Elena Ponceca, an Abu-Dhabi based analyst at Al Ramz Capital.

“Not only do they have the firm support of the governments but they also stand at enviable vantage points when it comes to securing government business due to the strength of the relationships,” she adds. Examples of state support include government notes issued for UAE banks during the 2008 crisis."



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Qatar crisis sends tremors through banking in the Gulf

Qatar crisis sends tremors through banking in the Gulf:

"While north Africa and the Levant have been beset by revolt and civil war in Syria and Libya in recent years, the Gulf states have remained a haven of relative stability. However, the political isolation of gas-rich Qatar this year has brought uncertainty to oil-wealthy Gulf Cooperation Council nations already suffering economic damage from the crude price collapse three years ago. In June, Saudi Arabia and the United Arab Emirates led Bahrain and Egypt in closing airports and seaports to Qatar, claiming it fostered terrorism. Doha denies this but is now isolated from the leading GCC powers. Travel and trade restrictions leave Qatar facing significant costs, with credit rating agency Moody’s saying the its future depends on the outcome of the crisis. “The severity of the diplomatic dispute between Gulf countries is unprecedented, which magnifies the uncertainty over the ultimate economic, fiscal and social impact on the GCC as a whole,” says Steffen Dyck, a senior credit officer at Moody’s."



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Foreign banks plan Saudi expansion amid economic reform

Foreign banks plan Saudi expansion amid economic reform:

"Goldman Sachs, JPMorgan, UBS and Citigroup are all planning to substantially increase their headcount in Saudi Arabia, executives said, as foreign banks expect lucrative opportunities from the country’s privatisation boom and its increasingly liberalised financial markets.  Wassim Younan, Goldman Sachs’ regional boss, said his bank could double its Saudi headcount in the next 12 months, while UBS plans to double its Riyadh workforce over the coming years. JPMorgan will increase headcount in Saudi Arabia by about 50 per cent, to 100 people, within the next three years, making the bank’s Riyadh office the same size as its regional headquarters in Dubai."



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Legal wrangles dent #Dubai’s image as region’s financial centre #UAE

Legal wrangles dent Dubai’s image as region’s financial centre:

"Differences between Dubai’s offshore international courts and its domestic-looking onshore courts are transforming the legal landscape in the emirate and undermining its position as a global financial centre. The friction came to a head last year when the government created a Joint Judicial Committee (JJC) to decide on potential conflicts of jurisdiction between the onshore Dubai courts and the increasingly busy courts in the offshore Dubai International Finance Centre (DIFC). The JJC’s ability to stay proceedings at the DIFC Courts, renowned for their investor-friendly environment, sent shockwaves through the legal community based in the Gulf’s commercial hub."



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FCA admits to meeting Aramco before proposing new listing rules

FCA admits to meeting Aramco before proposing new listing rules:

"The head of the City watchdog has admitted that he met with Saudi Aramco in early 2017, before the regulator published proposals that have been criticised for watering down governance rules in order to attract what will be the world’s biggest initial public offering when the oil company lists some of its shares. It is the first public admission from the Financial Conduct Authority that it met with the oil giant before coming out with its proposals in July. The acknowledgement came as two parliamentary select committees wrote to the FCA to demand answers about the level of government influence over the proposals, as London vies with cities such as New York to win the Aramco flotation. “We can confirm that we held conversations with Saudi Aramco and their advisers in light of their interest in a possible UK listing in the early part of this year. We emphasised during those conversations that we were reviewing the Listing Regime,” Andrew Bailey, the head of the FCA, wrote in a letter published on Friday to the Treasury and Business, Energy & Industrial Strategy committees."



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Thursday, 12 October 2017

Just How Big Is Oil's Invisible Friend? - Bloomberg Gadfly

Just How Big Is Oil's Invisible Friend? - Bloomberg Gadfly:

"The world's oil majors, beset by intimations of demand for their favorite product leveling off, seek comfort from an invisible friend.Compared to oil and coal, natural gas looks less fossilized. Long-term outlooks routinely show demand rising while it flattens for oil and falls for coal. This makes sense: Gas is versatile, useful both as a source of energy and a building block for chemicals; plus, when burned, it emits less carbon.In an increasingly electrified world where regulations around pollution are tightening, gas should be a relative winner. Oil majors have adjusted accordingly:"



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MIDEAST DEBT-Qataris hold non-deal bond roadshows as rift drags on -sources

MIDEAST DEBT-Qataris hold non-deal bond roadshows as rift drags on -sources:

"Qatari banks have met investors in Europe and Asia over the past few weeks to gauge their interest in potential U.S. dollar bond issues, as a diplomatic crisis in the region pressures their finances, sources familiar with the matter said.

Feedback was positive, but while international investors are ready to buy Qatari banks’ paper, they have also made clear that issuers would have to pay premiums in order to attract sufficient demand.

Access to international debt markets, a crucial source of funding for Qatar’s banking sector since oil prices dropped three years ago, has become trickier since the crisis erupted in early June as investors fear its impact on lenders’ liquidity. Those worries have partly eased as a result of the meetings, said the sources."



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Lawsuit filed against Mobily scandal suspects -Saudi regulator

Lawsuit filed against Mobily scandal suspects -Saudi regulator:

"Saudi Arabia’s market regulator said a lawsuit was filed on Thursday against individuals related to an accounting scandal at telecoms group Mobily. The public prosecution filed the suit in the Committee for the Resolution of Securities Disputes, which has jurisdiction over the dispute, the Capital Markets Authority (CMA) said on its website. The CMA did not name the suspects nor say how many were involved."



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OPEC's ‘Heavy Lifting’ Is Not Done, Says Gunvor’s Fyfe - Bloomberg

OPEC's ‘Heavy Lifting’ Is Not Done, Says Gunvor’s Fyfe - Bloomberg:

"David Fyfe, chief economist at Gunvor Group, says that legacy investments made pre-2014 in Brazil, Canada and Kazakhstan will come online in 2018, making OPEC’s job that much harder. OPEC and Russia could push for an extension of up to nine months when the group meets next month in Vienna, he said.

Fyfe was interviewed via email on Oct. 11. Comments have been edited and condensed."



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MIDEAST STOCKS-Saudi rebounds on insurers, QNB rises after earnings

MIDEAST STOCKS-Saudi rebounds on insurers, QNB rises after earnings:

"Saudi Arabia’s stock market rebounded on Thursday as insurance stocks regained some strength, while Qatar’s biggest bank edged up after it reported solid earnings.

The main Saudi index, which had sunk 2.2 percent on Wednesday, rose 1.4 percent to 6,988 points after testing demand at lower levels. However, it remained below the 200-day average, now at 7,041 points, which it fell through this week - a negative technical signal.

Twenty-three of the 33 listed insurers rose. All but one had dropped on Wednesday because of fears of an industry shakeout caused by a regulatory crackdown."



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Oil prices slip despite expected OPEC extension of output cuts

Oil prices slip despite expected OPEC extension of output cuts:

"Brent crude oil was down 20 cents at $56.74 a barrel by 0730 GMT. U.S. light crude was 25 cents lower at $51.05. Both benchmarks have risen more than 20 percent from their lows in June as world oil markets have tightened. The Organization of the Petroleum Exporting Countries and other producers including Russia agreed last year to reduce output by 1.8 million barrels per day (bpd) to prop up prices and the cuts, from January, have helped drain inventories. The OPEC-led deal helped lift oil from the $30 to $40 per barrel range in late 2016/early 2017. But traders say supplies remain ample despite these cuts, thanks in large part to surging U.S. production."



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MEDIA-Qatar may take part in IPO of Russia's En+ - Vedomosti

MEDIA-Qatar may take part in IPO of Russia's En+ - Vedomosti:

"* Qatar Investment Authority (QIA) fund is considering taking part in an initial public share offering of Russia’s En+, the Vedomosti newspaper reported on Thursday, citing two sources, close to the deal; * One of the sources said that QIA was invited to take part in En+’s IPO, while another source said that QIA was invited to become an anchor investor. The third source, close to one of the deal organisers, said that QIA could take part in the deal; * None of the sources disclosed the size of the stake which QIA could buy in En+;"



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MIDEAST STOCKS-Saudi edges up on stable insurers, no earnings boost for QNB

MIDEAST STOCKS-Saudi edges up on stable insurers, no earnings boost for QNB:

"Saudi Arabia’s stock market staged a modest rebound early on Thursday as insurance stocks stabilised, while solid quarterly earnings at Qatar’s biggest bank failed to boost that market.

The main Saudi index, which had sunk 2.2 percent on Wednesday, was up 0.2 percent in the first half-hour.

Twenty-five of the 33 listed insurance firms rose. All but one had dropped on Wednesday because of fears of an industry shakeout caused by a regulatory crackdown."



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Wednesday, 11 October 2017

Libya warns its oil recovery is under threat

Libya warns its oil recovery is under threat:

"The head of Libya’s national oil company (NOC) has warned that the country’s recovery in oil output is under threat as it has only received a quarter of its budget from the UN-backed government.

Mustafa Sanalla, the NOC chairman, told reporters in London that a target of 1.25m barrels a day of output was “very uncertain” with current production around 1m.

While that level is around four times higher than early 2016 the recovery is in jeopardy, with damage from earlier fighting still hampering production while political uncertainty in the country has led to a number of shut-ins at fields otherwise capable of producing."



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Italian asset manager buys stake in Iranian rival

Italian asset manager buys stake in Iranian rival:

"An Italian asset manager has become the first foreign investment group to buy a stake in an Iranian financial company, amid threats by US President Donald Trump to withdraw his endorsement of the nuclear agreement which opened the country to inward investment. Azimut, a €48bn group headquartered in Milan, is to acquire 20 per cent of Mofid Entekhab, an Iranian asset manager, for an undisclosed sum. “We were looking for an opportunity to invest in a very interesting market. Iran is a great story,” said Sergio Albarelli, chief executive of Azimut."



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