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Wednesday, 23 August 2017

Fitch: Banks' Impact From Qatar Boycott Hinges on Funding Mix

Fitch: Banks' Impact From Qatar Boycott Hinges on Funding Mix:

"Qatari banks' funding and liquidity are under varying degrees of pressure from outflows of non-domestic deposits and interbank borrowings, after several Arab countries severed diplomatic and logistical ties with Qatar in June, Fitch Ratings says. The boycott will also increase banks' financing costs in the international debt markets. The overall impact on each bank will depend on how much it relies on non-domestic sources for its funding. Banks with a greater reliance on non-domestic deposits include Ahli Bank, Al Khaliji, Commercial Bank, Doha Bank, and Qatar Islamic Bank. Banks with less reliance include Barwa Bank, International Bank of Qatar, and Qatar International Islamic Bank. Withdrawal of non-domestic deposits is likely to increase competition among banks for domestic deposits, pushing up funding costs and squeezing margins. Banks that have been more reliant on non-domestic deposits will need to price generously to attract domestic deposits away from other banks as these tend to be fairly stable - it is easier to keep or roll over existing deposits than to attract new ones. Deposits represent 75% of Qatari banks' non-equity funding. "



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Qatar Bankers Want to Know Who Their Friends Are in Gulf Scrap - Bloomberg

Qatar Bankers Want to Know Who Their Friends Are in Gulf Scrap - Bloomberg:

"It’s good to know who your friends are when times are tough.

Qatar’s banks are keeping track of which foreign partners have maintained business with them and which ones have scaled back lending during the boycott of the Gulf country by a Saudi-led bloc that started in early June.

The central bank wants to draw up a list that may be used when deciding who to give future business to in Qatar, according to three bankers briefed on the matter. "



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MIDEAST STOCKS-Small caps support Saudi; Egypt falls amid U.S. aid denial

MIDEAST STOCKS-Small caps support Saudi; Egypt falls amid U.S. aid denial:

"Stock markets in the Middle East were mixed on Wednesday with Saudi Arabia finding support from smaller companies while property developers were strong in Dubai.

The Riyadh index edged up 0.1 percent. Nine-tenths of the top 20 gainers were small to mid-sized stocks including Saudi Indian Co for Cooperative Insurance (Wafa), which added 1.6 percent after saying it had received "temporary and conditional" approval from the central bank to sell some of its professional liability insurance policies.

Shares of Wafa had suffered heavy losses since Sunday when the company, along with three other insurers, was slapped by the central bank with a temporary ban on selling motor vehicle policies because of irregular practices."



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Qatar’s Plucky Plan to Outlast the Saudi Embargo - Bloomberg

Qatar’s Plucky Plan to Outlast the Saudi Embargo - Bloomberg:

"For a moment, it looked like Saudi Arabia might be easing up on its estranged neighbor Qatar. On Aug. 17, King Salman bin Abdul-Aziz Al Saud Salman, the Saudi monarch, lifted restrictions on Qataris who want to take part in the annual hajj pilgrimage beginning on Aug. 30. The king even offered to fly Qataris to Mecca on Saudi airplanes as his guests. It was the Saudis’ warmest action toward Qatar since June, when the kingdom and three of its Arab allies imposed an embargo against the tiny emirate to punish it for allegedly supporting Islamic insurgents.

The hajj gesture, however, was part of a double-move against Qatar’s ruling family that’s only made the bad blood worse. The Saudis credited the “mediation” to an elderly descendant of Qatar’s founder, a royal cousin plucked from obscurity for surprise audiences with King Salman and his powerful son, Crown Prince Mohammed bin Salman. A photo distributed by the Saudi Press Agency showed the beaming Saudi king holding hands with Sheikh Abdullah Bin Ali Al Thani, whose brother was overthrown as Qatar’s first ruler in 1972 by the grandfather of Qatar’s current emir. “That will be viewed as intensely provocative in Doha,” Qatar’s capital, says Kristian Ulrichsen of Rice University’s Baker Institute for Public Policy. “They’re clearly trying to present this guy as an alternative to Qatar’s ruling elite.”

Qatar’s 37-year-old emir, Sheikh Tamim Bin Hamad Al Thani, has survived his frenemies’ initial siege and is riding a surge in domestic nationalism as Qataris dig in for a long standoff. Panic buying in grocery stores, driven by whispered fears of a coup or invasion, made headlines early on. Neither materialized, giving Sheikh Tamim time to cement friendships in the West with big-ticket purchases of U.S. military jets, Italian naval ships, and the contract of Brazilian superstar Neymar, the world’s most expensive soccer player, which was acquired on Aug. 2 by the Qatari-owned club Paris Saint-Germain. Qatar even flirted with buying a stake in American Airlines Inc."



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U.A.E. Excise Tax Starts October in Drive to Boost Revenue - Bloomberg

U.A.E. Excise Tax Starts October in Drive to Boost Revenue - Bloomberg:

"The United Arab Emirates will start imposing a tax on selected goods starting Oct. 1 as Gulf Arab nations seek to deepen government revenue to counter the drop in oil prices. A levy on designated goods -- tobacco, energy drinks and soft drinks -- will include those sold at airports and free zones, Younis Al Khoori, undersecretary at Ministry of Finance, told the state-run WAM news agency. Products purchased at airports by travelers taking the goods abroad will be exempt, he said. The move is one of the measures taken by the six-member Gulf Cooperation Council to bolster non-oil revenue and is a milestone for a region that has attracted companies and workers largely through the promise of tax-free living. The bloc is also moving to implement value-added taxation though governments say they have no plans to introduce income tax."



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Qatar food security project gets $440 mln bank financing

Qatar food security project gets $440 mln bank financing:

"Qatar Islamic Bank signed to provide 1.6 billion riyals ($440 million) of financing to build a food processing and storage facility at the country's Hamad Port, as Doha strengthens its resistance against sanctions by other Arab states. The 530,000 square metre facility, to be built by AlJaber Engineering in about two years, will include equipment to process and refine rice, raw sugar and edible oils, the bank said on Wednesday. It will also feature rice silos, warehouses and edible oil storage tanks. Some of the food processed by the facility may be exported regionally or globally, and waste products from the facility will be used to create animal feed."



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Saudi Wealth Fund Said to Hire $111 Billion-Portfolio Chief - Bloomberg

Saudi Wealth Fund Said to Hire $111 Billion-Portfolio Chief - Bloomberg:

"Saudi Arabia’s sovereign wealth fund, which is being transformed into a $2 trillion investment giant, hired Rashed Sharif as head of domestic investments, according to two people familiar with the matter. Sharif, previously chief executive officer of Riyad Bank’s investment-banking unit, will be responsible for managing the Public Investment Fund’s $111 billion portfolio of Saudi assets, the people said, asking not to be identified as the information is private. He will report to the fund’s managing director, Yasir Alrumayyan, they said. PIF, as the fund is known, plans to become the world’s largest when the government gives it ownership of Saudi Arabian Oil Co. along with the proceeds from the oil producer’s initial public offering, expected to be the biggest listing ever. Saudi Crown Prince Mohammed Bin Salman wants to remodel the kingdom into an investment powerhouse to reduce its dependence on oil."



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MIDEAST STOCKS-REITs, Al Rajhi continue rise in Saudi, region mostly quiet

MIDEAST STOCKS-REITs, Al Rajhi continue rise in Saudi, region mostly quiet:

"Shares in real estate investment trusts and a major bank in Saudi Arabia were up on Wednesday morning while most equity markets in the region moved little. The Riyadh index rose 0.3 percent as Al Maather REIT , which listed on Tuesday, surged its 10 percent limit for a second straight day. Al Jazira Mawten REIT gained 2.2 percent and Taleem REIT rose 1.3 percent. Shares in REITs have been heavily traded since the start of the week as local investors have been attracted by the sudden surge in activity. "



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