Sunday, 4 October 2009
Algosaibi Says Mashreq Lawsuit Based on Fraudulent Documents
Ahmad Hamad Algosaibi & Brothers Co., the Saudi-based company restructuring its debt, filed a new complaint against United Arab Emirates-based Mashreqbank PSC claiming that more than $200 million of foreign exchange transactions were based on fraudulent documents.
The motion, made public by New York State Supreme Court on Oct. 1, argues that a guarantee made in 2000 bears the signature of the late Abdullaziz Algosaibi, who was “lying paralyzed and non-responsive in a Texas hospital on the day he is alleged to have signed the documents,” according to the documents.
Mashreqbank rejected the accusations, saying in an e-mailed statement today that Ahmad Hamad Algosaibi & Brothers is attempting to distract from its own unpaid debts.
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The motion, made public by New York State Supreme Court on Oct. 1, argues that a guarantee made in 2000 bears the signature of the late Abdullaziz Algosaibi, who was “lying paralyzed and non-responsive in a Texas hospital on the day he is alleged to have signed the documents,” according to the documents.
Mashreqbank rejected the accusations, saying in an e-mailed statement today that Ahmad Hamad Algosaibi & Brothers is attempting to distract from its own unpaid debts.
UAE banks are falling short on provisions
UAE banks have not set aside sufficient provisions to cover for potential losses in the property sector, experts warn.
Failure to provide adequately for loan defaults helped trigger the spread of the subprime mortgage crisis in the US and led to numerous bank closures.
“We are still seeing low numbers here, basically around 2.5 per cent loan loss provisions to total loans,” said Mardig Haladjian, who heads the GCC banking team for Moody’s Investor Service, the ratings agency.
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Failure to provide adequately for loan defaults helped trigger the spread of the subprime mortgage crisis in the US and led to numerous bank closures.
“We are still seeing low numbers here, basically around 2.5 per cent loan loss provisions to total loans,” said Mardig Haladjian, who heads the GCC banking team for Moody’s Investor Service, the ratings agency.
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