Saudi Arabia’s failure to develop a local-currency bond market in line with an International Monetary Fund recommendation may limit debt sales to the biggest companies in the world’s top oil exporter.
A 15bn-riyal ($4bn) sukuk by the state-controlled General Aviation Authority lead local-currency offerings from at least four borrowers in the biggest Arab economy, data compiled by Bloomberg show. This compares with one sale in the year-earlier period and trails offerings in countries like Norway, an oil exporter with an economy 4% smaller, where 96 borrowers raised about $12.8bn.
Monday, 21 May 2012
EM bond defaults: rising | beyondbrics – FT.com
It’s been a good year for emerging markets bonds. Even as investors – unnerved by the latest development in the eurozone debt crisis and the dim outlook for a US recovery – continue to pull out of EM equities and EM currencies, appetite for EM bonds shows no sign of abating.
EM bond issues, at $403.2bn for the first five months of the year according to Dealogic, are at a record high while fund inflow into the asset class hit $18.4bn for the year to May 2 compared to $5.7bn during the same period last year, according to EPFR data.
But is the focus on the level of EM bond issuance and the JPMorgan EMBI Global index (which scaled to a new high of 608.7 this month) misplaced? Indeed, a look at the level of EM bond defaults suggest that things are not as quite frothy as they might appear.
EM bond issues, at $403.2bn for the first five months of the year according to Dealogic, are at a record high while fund inflow into the asset class hit $18.4bn for the year to May 2 compared to $5.7bn during the same period last year, according to EPFR data.
But is the focus on the level of EM bond issuance and the JPMorgan EMBI Global index (which scaled to a new high of 608.7 this month) misplaced? Indeed, a look at the level of EM bond defaults suggest that things are not as quite frothy as they might appear.
gulfnews : IMF report shows steady growth recovery for UAE
The UAE has weathered the global economic and financial crisis well due to strong fundamentals as well as timely policy responses, a new International Monetary Report shows.
The UAE's GDP growth this year is expected to decline to 2.3 per cent, down from 4.9 per cent last year, as fiscal consolidation continues. Thwe UAE's GDP is expected to reach $386 billion (Dh1.41 trillion) this year, up from $360 billion (Dh1.32 trillion) last year, according to the report.
The report also address how the UAE has handle its outstanding public debt, which has reached $252.9 billion (Dh928.64 billion) — more than 70 per cent of the country's gross domestic product (GDP).
The UAE's GDP growth this year is expected to decline to 2.3 per cent, down from 4.9 per cent last year, as fiscal consolidation continues. Thwe UAE's GDP is expected to reach $386 billion (Dh1.41 trillion) this year, up from $360 billion (Dh1.32 trillion) last year, according to the report.
The report also address how the UAE has handle its outstanding public debt, which has reached $252.9 billion (Dh928.64 billion) — more than 70 per cent of the country's gross domestic product (GDP).
MENA stock markets close - May 21, 2012
| Exchange | Status | Index | Change | ||||
 | TASI (Saudi Stock Market) | 7029.35 | 0.71% | ||||
 | DFM (Dubai Financial Market) | 1488.09 | 1.47% | ||||
| ADX (Abudhabi Securities Exchange) | 2468.49 | 0.21% | ||||
 | KSE (Kuwait Stock Exchange) | 6415.24 | -0.10% | ||||
 | BSE (Bahrain Stock Exchange) | 1146.44 | -0.21% | ||||
 | MSM (Muscat Securities Market) | 5623.22 | 0.08% | ||||
 | QE (Qatar Exchange) | 8423.3 | 0.24% | ||||
 | LSE (Beirut Stock Exchange) | 1168.88 | -0.37% | ||||
 | EGX 30 (Egypt Exchange) | 4878.37 | 1.80% | ||||
 | ASE (Amman Stock Exchange) | 1878.74 | -1.51% | ||||
 | TUNINDEX (Tunisia Stock Exchange) | 5108.08 | -0.17% | ||||
 | CB (Casablanca Stock Exchange) | 9813.49 | 0.68% | ||||
 | PSE (Palestine Securities Exchange) | 455.4 | -0.33% | ||||
RAK and cybergroup click over DNO stake - FT.com
The leading investor in DNO International, a Kurdistan-focused oil explorer, has agreed to backtrack on commitments to reduce its shareholding to 30 per cent to remove an overhang on its shares ahead of a possible London listing.
The change unravels undertakings given last year by RAK Petroleum, a state-controlled investment company based in the United Arab Emirates, to dilute its current 43 per cent stake following an agreed merger of its oil interests with DNO, Norway’s first oil company to be listed on the Oslo stock exchange.
The change unravels undertakings given last year by RAK Petroleum, a state-controlled investment company based in the United Arab Emirates, to dilute its current 43 per cent stake following an agreed merger of its oil interests with DNO, Norway’s first oil company to be listed on the Oslo stock exchange.
ICD says Dubai Duty Free ups loan to $1.5 bln - Yahoo! News UK
Airport retailer Dubai Duty Free has increased the size of a multi-tranche loan facility it is currently raising to $1.5 billion, driven by high interest from local and international lenders, a senior Dubai government official said on Monday.
"We are raising $1.5 billion and we are getting almost close to double that in terms of interest but hasn't been concluded yet," Mohammed Al Shaibani, the chief executive officer of Investment Corporation of Dubai, told Reuters in an interview. "There is an opportunity and commercial banks know exactly what to go for," added Shaibani, who also head the Dubai ruler's court.
Dubai Duty Free had said in April it mandated banks for a $1.1 billion financing facility to help fund an expansion at Dubai's international airport. The facility includes Islamic and conventional tranches.
"We are raising $1.5 billion and we are getting almost close to double that in terms of interest but hasn't been concluded yet," Mohammed Al Shaibani, the chief executive officer of Investment Corporation of Dubai, told Reuters in an interview. "There is an opportunity and commercial banks know exactly what to go for," added Shaibani, who also head the Dubai ruler's court.
Dubai Duty Free had said in April it mandated banks for a $1.1 billion financing facility to help fund an expansion at Dubai's international airport. The facility includes Islamic and conventional tranches.
MIDEAST STOCKS-Gulf markets, Egypt rise on bargain-hunting - Yahoo! News UK
Egypt's bourse and most Gulf markets rose on Monday as investors bought stocks oversold in recent days on euro zone fears, while a rise in oil prices helped improve local sentiment.
Having hit a 2012 low on Friday, Brent crude rose 73 cents to $107.87 a barrel by 1246 GMT on hopes China could take steps to stimulate growth and lift fuel demand at the world's second largest oil user.
However, the spectre of European sovereign debt and a potential 'Grexit' event - Greece leaving the euro zone - would continue to be a primary driver of regional trading on a lack of domestic catalysts.
Having hit a 2012 low on Friday, Brent crude rose 73 cents to $107.87 a barrel by 1246 GMT on hopes China could take steps to stimulate growth and lift fuel demand at the world's second largest oil user.
However, the spectre of European sovereign debt and a potential 'Grexit' event - Greece leaving the euro zone - would continue to be a primary driver of regional trading on a lack of domestic catalysts.
Fight over Gulf wealth funds to intensify-Invesco Asharq Alawsat Newspaper (English)
A shift in focus from global to local investments by the big Gulf sovereign wealth funds after the Arab Spring is set to step up competition among Western governments, asset managers and companies hoping for some of their cash, a study by U.S. fund manager Invesco Ltd showed.
"Western governments, including the U.K., have approached SWFs (the funds) from the Middle East to help with economic recovery, but many will fight a losing battle," Nick Tolchard, head of Invesco Middle East told reporters at a conference in Dubai.
"There is certainly less money to invest internationally so the stakes are higher."
"Western governments, including the U.K., have approached SWFs (the funds) from the Middle East to help with economic recovery, but many will fight a losing battle," Nick Tolchard, head of Invesco Middle East told reporters at a conference in Dubai.
"There is certainly less money to invest internationally so the stakes are higher."
STOCKS NEWS MIDEAST-Saudi ends above key 7,000 mark - Yahoo! News UK
Saudi Arabia closes above a key psychological level as buyers return to the market in search of bargains after
a euro zone-induced sell-off earlier in the week.
The index rises 0.7 percent to 7,029 points, its biggest one-day gain since April 28.
"It (7,000 level) is a pretty important marker," says Amer Khan, fund manager at Shuaa Asset Management.
a euro zone-induced sell-off earlier in the week.
The index rises 0.7 percent to 7,029 points, its biggest one-day gain since April 28.
"It (7,000 level) is a pretty important marker," says Amer Khan, fund manager at Shuaa Asset Management.
DIFC Investments $1 bln loan near; to help sukuk refi - Yahoo! News UK
DIFC Investments, the investment arm of the company running Dubai's financial free zone, is close to securing a $1 billion loan from four banks to help refinance an upcoming Islamic bond maturity, a banking source familiar
with the matter said.
Emirates NBD, Dubai's largest lender, and Standard Chartered will contribute an equal amount into the deal, while Noor Islamic Bank and Dubai Islamic Bank,also join the deal but with a smaller commitment.
The loan will help refinance a $1.25 billion sukuk maturing in June, and will be in place in time for the redemption date. "It's in the documentation phase," the source, who requested anonymity, said. "There will be a syndication in due course but they want to deal with the sukuk first."
with the matter said.
Emirates NBD, Dubai's largest lender, and Standard Chartered will contribute an equal amount into the deal, while Noor Islamic Bank and Dubai Islamic Bank,also join the deal but with a smaller commitment.
The loan will help refinance a $1.25 billion sukuk maturing in June, and will be in place in time for the redemption date. "It's in the documentation phase," the source, who requested anonymity, said. "There will be a syndication in due course but they want to deal with the sukuk first."
Gulf left vulnerable to oil price swings - FT.com
As oil prices fell sharply in recent weeks, consumers may have breathed a sigh of relief. But for Gulf governments, the drop was a reminder of their increasing dependence on energy prices remaining at historic highs.
With increased domestic spending pushing up the revenues Gulf countries need to fund their budgets, the energy-rich states have become more vulnerable to volatility in the oil markets. It is no longer unforeseeable, some say, for the days of budget surpluses to come to an end.
“It comes down to the degree to which countries are willing to live with budget deficits, to what extent they can afford these deficits,” says Farouk Soussa, chief regional economist at Citigroup in Dubai.
With increased domestic spending pushing up the revenues Gulf countries need to fund their budgets, the energy-rich states have become more vulnerable to volatility in the oil markets. It is no longer unforeseeable, some say, for the days of budget surpluses to come to an end.
“It comes down to the degree to which countries are willing to live with budget deficits, to what extent they can afford these deficits,” says Farouk Soussa, chief regional economist at Citigroup in Dubai.
Abu Dhabi picks Goldman, others for state-backed realty merger | Reuters
Abu Dhabi has picked four banks as financial advisors for the potential state-backed merger of property developers Aldar Properties ALDR.AD and Sorouh Real Estate SOR.AD, three sources aware of the matter said on Monday.
The oil-rich emirate has hired Goldman Sachs (GS.N) and National Bank of Abu Dhabi NBAD.AD to advise a steering committee that will oversee the potential merger, one of the sources familiar with the matter said.
Morgan Stanley (MS.N) and Credit Suisse (CSGN.VX) are advising the companies, the three banking and industry sources said speaking on condition of anonymity as the matter has not been made public.
The oil-rich emirate has hired Goldman Sachs (GS.N) and National Bank of Abu Dhabi NBAD.AD to advise a steering committee that will oversee the potential merger, one of the sources familiar with the matter said.
Morgan Stanley (MS.N) and Credit Suisse (CSGN.VX) are advising the companies, the three banking and industry sources said speaking on condition of anonymity as the matter has not been made public.
Kuwait's Global says wins $250 mln case vs UAE bank | Reuters
Kuwait's Global Investment House said it won a long-running legal battle over an aborted buy of a stake in National Bank of Umm Al Qaiwain after an appeals court ordered the Abu Dhabi-listed bank to return its deposit plus interest.
The $250 million sum was placed with NBQ in August 2008 as the first part of Global's purchase of a 20 percent stake in the bank through a 2.36 billion dirhams ($642.5 million) convertible bond issue.
However, as financial markets slumped in late-2008 and the Kuwaiti firm encountered debt problems which forced it into a restructuring, Global cancelled the planned purchase and wanted the money back, but NBQ said it was entitled to keep it.
The $250 million sum was placed with NBQ in August 2008 as the first part of Global's purchase of a 20 percent stake in the bank through a 2.36 billion dirhams ($642.5 million) convertible bond issue.
However, as financial markets slumped in late-2008 and the Kuwaiti firm encountered debt problems which forced it into a restructuring, Global cancelled the planned purchase and wanted the money back, but NBQ said it was entitled to keep it.
Persian Gulf Stocks: Drake & Scull and Emaar Properties in Dubai - Bloomberg
Dubai’s benchmark DFM General Index (DFMGI) rallied 1.5 percent, the most in almost a month, to 1,488.09 at the 2 p.m. close in the emirate.
Egypt: UAE backs agriculture projects | beyondbrics – FT.com
A United Arab Emirates firm has agreed to invest up to $3bn in Egyptian land reclamation “mega-projects” that would turn 100,000 acres into agricultural fields, according to the website of Egypt’s General Authority for Investment.
Egyptian minister of agriculture Mohammad Reda Ismail announced earlier this week the UAE’s Al Thaherah firm would turn 20,000 acres a year over the next five years into chicken farms as part of a massive agricultural project called Toshka, near Lake Nasser in the upper Nile River region of southern Egypt.
According to Ismail, the project aims to create the country’s second largest poultry farm as well as an industrial plant for the processing of meats.
Egyptian minister of agriculture Mohammad Reda Ismail announced earlier this week the UAE’s Al Thaherah firm would turn 20,000 acres a year over the next five years into chicken farms as part of a massive agricultural project called Toshka, near Lake Nasser in the upper Nile River region of southern Egypt.
According to Ismail, the project aims to create the country’s second largest poultry farm as well as an industrial plant for the processing of meats.
Qatar agency lifts Xstrata Stake To 8.344% - MarketWatch
Qatar Investment Authority, owner of Qatar Holding LLC, said Monday it bought 1.64 million shares in diversified mining group Xstrata PLC at GBP9.1772 per share, lifting its total holding to 250.54 million shares, or 8.344%.
-Xstrata shares at 0805 GMT, up 12 pence, or 1.26%, at 926.2 pence valuing the company at GBP27.47 billion
-Xstrata shares at 0805 GMT, up 12 pence, or 1.26%, at 926.2 pence valuing the company at GBP27.47 billion
Prince Alwaleed: "The Prince of Deals"
Prince Alwaleed is one of the world's greatest investors. Born in 1955, he started out as an investor in the late 1970s by opening a small office on a side street in Riyadh, Saudi Arabia. He had $30,000. By 1988, Alwaleed was the subject of a Forbes profile. He was 33.
Today, he is one of the richest men in the world, with an estimated net worth of around $20 billion. He controls a vast fortune through Kingdom Holding Co., of which he is the founder, CEO and 95% owner. He has created his fortune through a mix of private and public investments across dozens of industries in over 130 countries.
You can make a good case that he's the No. 2 greatest investor ever behind Warren Buffett. And though I'm getting tired of these kinds of labels, he's been called "the Arabian Warren Buffett." (Buffett, in a metaphorical tipping of the hat, called himself "the Alwaleed of America.") A better nickname comes from Forbes, which called him "the Prince of Deals."
Today, he is one of the richest men in the world, with an estimated net worth of around $20 billion. He controls a vast fortune through Kingdom Holding Co., of which he is the founder, CEO and 95% owner. He has created his fortune through a mix of private and public investments across dozens of industries in over 130 countries.
You can make a good case that he's the No. 2 greatest investor ever behind Warren Buffett. And though I'm getting tired of these kinds of labels, he's been called "the Arabian Warren Buffett." (Buffett, in a metaphorical tipping of the hat, called himself "the Alwaleed of America.") A better nickname comes from Forbes, which called him "the Prince of Deals."
Banking reform establishes new safeguards - The National
The financial crisis that gripped markets in 2008 - and still ripples through the world economy - offered stern lessons for governments keen to make sure their countries were protected against financial contagion.
As The National reported yesterday, the UAE is preparing for the biggest shake-up of the banking and financial sectors in the last three decades. A new banking law announced last month by the Central Bank is now being fleshed out with an updated draft expected by the end of the year, with implementation next year at the earliest.
At the heart of this change is a new government agency, in essence a watchdog, which will have oversight of financial services in the country. This role, which involves making sure consumers are protected from fraud and that financial services companies operate smoothly and legally, was previously part of the remit of the Central Bank. Now it will be taken over by a new regulator called the Financial Services Authority. This new FSA will also oversee the equity and debt capital markets.
As The National reported yesterday, the UAE is preparing for the biggest shake-up of the banking and financial sectors in the last three decades. A new banking law announced last month by the Central Bank is now being fleshed out with an updated draft expected by the end of the year, with implementation next year at the earliest.
At the heart of this change is a new government agency, in essence a watchdog, which will have oversight of financial services in the country. This role, which involves making sure consumers are protected from fraud and that financial services companies operate smoothly and legally, was previously part of the remit of the Central Bank. Now it will be taken over by a new regulator called the Financial Services Authority. This new FSA will also oversee the equity and debt capital markets.
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