Fitch Ratings has affirmed Kuwait Finance House's (KFH) Long-term Issuer Default Rating (IDR) at 'A+' with a Stable Outlook. At the same time, the agency has downgraded KFH's Viability Rating (VR) to 'bb'. A full list of rating actions is at the end of this rating action commentary.
Tuesday, 11 September 2012
Global reaches second debt deal | GulfNews.com
Global Investment House KSCC’s second deal with creditors to restructure $1.7 billion (Dh6.24 billion) of debt may help Kuwait’s struggling investment companies to recover after the nation’s credit crisis slowed lending.
Shareholders of Kuwait City-based Global agreed this month to issue 122 million Kuwaiti dinars (Dh 1.59 billion or $433 million) of shares to be held by a special purpose vehicle, which would manage $435 million of the company’s debt. Global would transfer the remaining liabilities to a second SPV, enabling it to focus on reviving asset management, brokerage and investment banking businesses after reporting consistent losses since the end of 2008.
“We view the restructuring of Global’s debt as generally positive to the extent that it provides for a resolution process,” Stathis Kyriakides, a Cyprus-based analyst at Moody’s Investors Service, said in an e-mailed response to questions on September 7. For banks, “it appears that a clearer path toward recovering a portion of their exposure is gradually being developed.”
Shareholders of Kuwait City-based Global agreed this month to issue 122 million Kuwaiti dinars (Dh 1.59 billion or $433 million) of shares to be held by a special purpose vehicle, which would manage $435 million of the company’s debt. Global would transfer the remaining liabilities to a second SPV, enabling it to focus on reviving asset management, brokerage and investment banking businesses after reporting consistent losses since the end of 2008.
“We view the restructuring of Global’s debt as generally positive to the extent that it provides for a resolution process,” Stathis Kyriakides, a Cyprus-based analyst at Moody’s Investors Service, said in an e-mailed response to questions on September 7. For banks, “it appears that a clearer path toward recovering a portion of their exposure is gradually being developed.”
UPDATE 1-Iranian MPs call for rapid intervention to halt currency turmoil - Yahoo! News Maktoob
A group of Iranian legislators, critical of the policies of President Mahmoud Ahmadinejad, has urged the central bank to intervene in the currency market to support the rial, which hit record lows this week, Iranian media
reported on Tuesday.
Iran's economy and finance minister, meanwhile was quoted as saying that the country had sufficient foreign exchange reserves and the market turmoil would be resolved "within three days." The Iranian currency hit an all-time low on the open market on Monday at 25,650 to the dollar, half its value of a year ago and after losing about 17 percent since last Thursday. It was more stable on Tuesday.
reported on Tuesday.
Iran's economy and finance minister, meanwhile was quoted as saying that the country had sufficient foreign exchange reserves and the market turmoil would be resolved "within three days." The Iranian currency hit an all-time low on the open market on Monday at 25,650 to the dollar, half its value of a year ago and after losing about 17 percent since last Thursday. It was more stable on Tuesday.
Qatari in Egypt: Buying Foreign Policy | Al Akhbar English
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| Egypt's President Mohamed Mursi (L) shakes hands with Qatar's Emir Sheikh Hamad bin Khalifa al-Thani during the 16th summit of the Non-Aligned Movement in Tehran, 30 August 2012. (Photo: Reuters - Egyptian Presidency - Handout) |
Qatari Prime Minister Hamad bin Jassem announced the proposed investments at a joint press conference with Egyptian Prime Minister Hisham Kandil on September 6. This new wave of investment comes on the heels of a $2 billion Qatari loan to the Egyptian state, the first installment of which was deposited at the Central Bank of Egypt on August 23.
The announcement came just a week after Mursi made headlines at the Non-Aligned Movement summit in Tehran when he announced his full support for the Syrian revolution against what he called an “oppressive regime.”
OPEC pumps more oil, sees abundant supply Asharq Alawsat Newspaper (English)
Crude oil inventories in industrialized countries are ample and the risk to global oil demand growth next year remains skewed to the downside, producer group OPEC said on Tuesday, citing a slowing global economy.
The Organization of the Petroleum Exporting Countries, in a monthly report, said its own production rose by 254,000 barrels per day in August, despite the July 1 start of a European Union embargo on Iran's oil exports.
OPEC's report comes as the United States and other consumer nations are worried about high oil prices. Leaders of the Group of Eight major economies have signaled their readiness to tap into emergency oil stockpiles if needed.
The Organization of the Petroleum Exporting Countries, in a monthly report, said its own production rose by 254,000 barrels per day in August, despite the July 1 start of a European Union embargo on Iran's oil exports.
OPEC's report comes as the United States and other consumer nations are worried about high oil prices. Leaders of the Group of Eight major economies have signaled their readiness to tap into emergency oil stockpiles if needed.
MENA stock markets close - September 11, 2012
| Exchange | Status | Index | Change | ||||
 | TASI (Saudi Stock Market) | 7086.8 | 0.20% | ||||
 | DFM (Dubai Financial Market) | 1557.45 | 0.02% | ||||
| ADX (Abudhabi Securities Exchange) | 2596.73 | 0.16% | ||||
 | KSE (Kuwait Stock Exchange) | 5826.21 | -0.41% | ||||
 | BSE (Bahrain Stock Exchange) | 1072.51 | -0.39% | ||||
 | MSM (Muscat Securities Market) | 5551.51 | -0.73% | ||||
 | QE (Qatar Exchange) | 8474.7 | -0.04% | ||||
 | LSE (Beirut Stock Exchange) | 1120.08 | 0.08% | ||||
 | EGX 30 (Egypt Exchange) | 5697.48 | 1.63% | ||||
 | ASE (Amman Stock Exchange) | 1901.16 | 0.22% | ||||
 | TUNINDEX (Tunisia Stock Exchange) | 5151.83 | -0.54% | ||||
 | CB (Casablanca Stock Exchange) | 9797.63 | -0.36% | ||||
 | PSE (Palestine Securities Exchange) | 416.26 | -0.76% | ||||
Kuwait's Agility sees growth in Arab Spring states | Kippreport.com
Kuwaiti logistics firm Agility says it is gearing up for expansion in emerging markets, much of it in countries that experienced Arab Spring political upheavals as new governments there spend more on their oil industries and infrastructure.
The group was the largest supplier to the U.S. Army in the Middle East during the war in Iraq, but is changing tack and putting less emphasis on defence services, Chairman and Managing Director Tarek Sultan told Reuters in an interview.
He said the company was in talks with the new governments in Egypt, Tunisia and Libya on increasing its presence and investments.
The group was the largest supplier to the U.S. Army in the Middle East during the war in Iraq, but is changing tack and putting less emphasis on defence services, Chairman and Managing Director Tarek Sultan told Reuters in an interview.
He said the company was in talks with the new governments in Egypt, Tunisia and Libya on increasing its presence and investments.
MIDEAST STOCKS-Gulf mkts end little changed; Oman down on profit-taking - Yahoo! News Maktoob
Gulf markets were mixed on Tuesday as investors failed to find catalysts to justify taking the market higher, while Saudi Arabia's bourse made marginal gains as it traded in a sideways pattern.
Saudi Arabia's bourse gained 0.2 percent, finishing higher for a second session in the last eight. Insurance stocks
rallied, with the sector's index up 1.4 percent, a sign that investors are targeting smaller companies which they can move easily for quick returns.
Petrochemicals stocks also supported gains, with bellwether Saudi Basic Industries Corp (SABIC) up 0.8 percent and Saudi Arabian Fertilizers rising 1.1 percent.
Saudi Arabia's bourse gained 0.2 percent, finishing higher for a second session in the last eight. Insurance stocks
rallied, with the sector's index up 1.4 percent, a sign that investors are targeting smaller companies which they can move easily for quick returns.
Petrochemicals stocks also supported gains, with bellwether Saudi Basic Industries Corp (SABIC) up 0.8 percent and Saudi Arabian Fertilizers rising 1.1 percent.
Obama backs effort to recover Arab Spring assets Asharq Alawsat Newspaper (English)
U.S. President Barack Obama reaffirmed American support Tuesday for Arab Spring nations seeking to recover possibly billions of dollars in assets stashed away by members of the toppled regimes.
But one of Obama's senior advisers noted that international legal obstacles still remain to track down and reclaim looted money that is often hidden under false names and dummy corporations.
"This money — potentially billions of dollars — does not belong to those who wielded power. It belongs to the people," Obama said in a video message to open a conference on efforts to trace and recovery state funds from the deposed rulers in Libya, Tunisia and Egypt.
But one of Obama's senior advisers noted that international legal obstacles still remain to track down and reclaim looted money that is often hidden under false names and dummy corporations.
"This money — potentially billions of dollars — does not belong to those who wielded power. It belongs to the people," Obama said in a video message to open a conference on efforts to trace and recovery state funds from the deposed rulers in Libya, Tunisia and Egypt.
Egypt revises up 2011/12 budget deficit to 11 pct of GDP | Reuters
Egypt revised up its budget deficit for the 2011/12 fiscal year to 11 percent of gross domestic product from an earlier projection of 8.6 percent, the finance minister said on Tuesday.
The deficit was 170 billion Egyptian poundsin the year that ended on June 30 and not the 134 billion pounds projected earlier, Mumtaz al-Saeed said in a statement carried on the Finance Ministry website.
The deficit was 170 billion Egyptian poundsin the year that ended on June 30 and not the 134 billion pounds projected earlier, Mumtaz al-Saeed said in a statement carried on the Finance Ministry website.
Abu Dhabi Stocks Rise on U.A.E. Growth Forecast, Oman Declines - Bloomberg
Abu Dhabi’s shares rose for a fifth day after the United Arab Emirates central bank said growth in non-oil industries may accelerate to 4 percent this year, boosting the outlook for company earnings.
Abu Dhabi Islamic Bank PJSC (ADIB), the U.A.E.’s second-biggest Shariah-compliant bank, advanced for a fourth day. First Gulf Bank PJSC (FGB), the lender controlled by Abu Dhabi’s ruling family, climbed to the highest since Aug. 27. Abu Dhabi’s ADX General Index (ADSMI) rose 0.2 percent to 2,596.73, the highest since Aug. 26, at the close in the emirate. The measure gained 1.7 percent during the five-day rally. Dubai’s DFM General Index (DFMGI) and Qatar’s gauge were little changed, while Oman’s index fell 0.7 percent.
Abu Dhabi Islamic Bank PJSC (ADIB), the U.A.E.’s second-biggest Shariah-compliant bank, advanced for a fourth day. First Gulf Bank PJSC (FGB), the lender controlled by Abu Dhabi’s ruling family, climbed to the highest since Aug. 27. Abu Dhabi’s ADX General Index (ADSMI) rose 0.2 percent to 2,596.73, the highest since Aug. 26, at the close in the emirate. The measure gained 1.7 percent during the five-day rally. Dubai’s DFM General Index (DFMGI) and Qatar’s gauge were little changed, while Oman’s index fell 0.7 percent.
FT Alphaville » Emirates is NOT a SOE, OK?
Apparently Emirates boss Tim Clark can say this with a straight face.
From a filing to the Australian Competition and Consumer Commission.
From a filing to the Australian Competition and Consumer Commission.
Investment Corporation of Dubai’s ownership of Emirates is a similar arrangement to other airlines worldwide that operate fully commercially and also have a government shareholding (including in Australasia, South East Asia and Europe).
Importantly, ownership does not alter the commercial practices of Emirates, which has a strong history of consistent profitability and dividend payments over more than two decades.
The Times of Oman: Oman's rail project to cost over $5b
The Sultanate's ambitious national railway project is estimated to have a capital expenditure of $5.305 billion for the 1,061 kilometres in the first phase of the project.
This is based on a rough estimate during the feasibility study and there could be a possibility of a difference between 20 per cent and 30 per cent in the actual cost at the time of implementation.
The GCC railway network is estimated to have a capital expenditure of $11.2 billion, Eng. Salim bin Said Al Amri, Assistant Director General of Roads for Maintenance and Land Transport (Head of Railway Team) at the Ministry of Transport and Communications, told journalists, on the sidelines of Oman Transport Infrastructure Summit yesterday.
This is based on a rough estimate during the feasibility study and there could be a possibility of a difference between 20 per cent and 30 per cent in the actual cost at the time of implementation.
The GCC railway network is estimated to have a capital expenditure of $11.2 billion, Eng. Salim bin Said Al Amri, Assistant Director General of Roads for Maintenance and Land Transport (Head of Railway Team) at the Ministry of Transport and Communications, told journalists, on the sidelines of Oman Transport Infrastructure Summit yesterday.
UAE Central Bank announces its own ‘QE facility’ to tackle property debt overhang « ArabianMoney
The UAE Central Bank has come up with its own answer to ‘quantitive easing’ or money printing to ease the mounting pressure of property debt on the balance sheets of local banks, to be known as the marginal lending facility or ‘MLF’.
Technically MLF is a discount facility that can fund the banks when finance in the markets becomes unavailable or expensive. Still the aim is to funnel cheap money into the banking system like the more complicated US system called QE and the European Stability Fund.
Technically MLF is a discount facility that can fund the banks when finance in the markets becomes unavailable or expensive. Still the aim is to funnel cheap money into the banking system like the more complicated US system called QE and the European Stability Fund.
Now it’s back to reality | GulfNews.com
What a blast! For over a month now the world has been gripped by Olympic fascination and excitement. A total of more than 14,000 Olympic athletes including 4,200 Paralympic athletes descended on London to give the performance of their lives. Spectators saw numerous records tumbling across the board and an atmosphere that truly inspired a generation of wannabe Olympians. I am proud of Team GB finishing third in the medal table winning the amazing total of 65 medals. And the UAE’s first gold medal in this year’s Paralympics is great cause for celebration. But now, as even the Paralympics draw to a close, what will happen when the flame dims?
The woes that have long cast shadows over the world economy remain. The UK is no different, with GDP contracting by 0.5 per cent in the quarter to June and early indicators for the third quarter suggesting a modest rebound. While this comes as an economic disappointment it doesn’t come as a surprise: we are all recovering from the worst economic crisis in living memory, and the UK is not immune to the problems in the Euro Area.
The woes that have long cast shadows over the world economy remain. The UK is no different, with GDP contracting by 0.5 per cent in the quarter to June and early indicators for the third quarter suggesting a modest rebound. While this comes as an economic disappointment it doesn’t come as a surprise: we are all recovering from the worst economic crisis in living memory, and the UK is not immune to the problems in the Euro Area.
Abu Dhabi shipbuilder weighs expansion bid in Germany - The National
Abu Dhabi Mar, a shipbuilder based in the capital, is weighing an expansion of its European operations with the possible acquisition of a naval repair yard in eastern Germany.
The company has expressed an interest in buying P+S Werften, an insolvent German shipbuilder the portfolio of which includes the construction and repair of naval vessels.
"Our shareholder isn't ruling out expanding its business in Germany," said Susanne Wiegand, the managing director of Nobiskrug, a German shipbuilding firm owned by Abu Dhabi Mar.
The company has expressed an interest in buying P+S Werften, an insolvent German shipbuilder the portfolio of which includes the construction and repair of naval vessels.
"Our shareholder isn't ruling out expanding its business in Germany," said Susanne Wiegand, the managing director of Nobiskrug, a German shipbuilding firm owned by Abu Dhabi Mar.
Dealmaking cameo may prove lucrative for fixer Blair | Reuters
If Tony Blair's cameo proves to be a deciding factor in winning support from Qatar for a Swiss commodity trader's $36 billion bid for a giant mining firm, the former British prime minister could become a sought-after fixer in global finance.
Blair's surprise involvement in a last-minute breakthrough between Glencore and the government of Qatar, which is a shareholder in Glencore's target Xstrata, shows that Blair's Middle East connections are paying off.
Those links are likely to prove ever more valuable as Gulf states look to invest their oil and gas riches overseas to diversify their wealth.
Blair's surprise involvement in a last-minute breakthrough between Glencore and the government of Qatar, which is a shareholder in Glencore's target Xstrata, shows that Blair's Middle East connections are paying off.
Those links are likely to prove ever more valuable as Gulf states look to invest their oil and gas riches overseas to diversify their wealth.
Saudi construction company's future in the balance - The National
The future of the Saudi industrial construction company Mohammad Al-Mojil Group (MMG) could be decided at an extraordinary general meeting (EGM) soon.
In a statement made to the Saudi stock exchange, MMG announced it was preparing to call an EGM to discuss its future after making an anticipated 800 million Saudi riyals (Dh783.5m) loss in the second quarter. MMG said the expected losses would lead the company to record accumulated losses of an unprecedented 1.5 billion riyals, exceeding its total capital of 1.25bn riyals and triggering rules requiring an EGM to discuss winding the company up.
According to the company, its liabilities stood at 2.64bn riyals at the end of June. Liabilities worth a total of 2.32bn riyals fall due within the next 12 months.
In a statement made to the Saudi stock exchange, MMG announced it was preparing to call an EGM to discuss its future after making an anticipated 800 million Saudi riyals (Dh783.5m) loss in the second quarter. MMG said the expected losses would lead the company to record accumulated losses of an unprecedented 1.5 billion riyals, exceeding its total capital of 1.25bn riyals and triggering rules requiring an EGM to discuss winding the company up.
According to the company, its liabilities stood at 2.64bn riyals at the end of June. Liabilities worth a total of 2.32bn riyals fall due within the next 12 months.
Fifth of UAE banks' assets in property - The National
Nearly four years after the UAE housing boom first began to deflate, banks still hold about a fifth of their total assets in the property market.
Total bank exposure to the property market stood at Dh232 billion (US$63.16bn), the Central Bank said in a report released yesterday.
The net amount represents 21.5 per cent of banks' deposit base and 21.3 per cent of their total net loans and advances.
Total bank exposure to the property market stood at Dh232 billion (US$63.16bn), the Central Bank said in a report released yesterday.
The net amount represents 21.5 per cent of banks' deposit base and 21.3 per cent of their total net loans and advances.
Saudi Arabia transforms into a game changer | GulfNews.com
Ten years ago, private bankers and overseas executives who had business meetings in Saudi Arabia would plan their itinerary in such a way that they would spend the minimum possible time in the Kingdom, allocating the better part of their Gulf tour to the more fashionable and cosmopolitan Dubai, which served as their base station. Today, the same executives, if they are still left in business, would like to spend as much time in the Kingdom as they can, exploring the huge opportunities that the Saudi market holds out, although a stay in Dubai continues to be as glamorous as ever.
In fact, Saudi Arabia is now the toast of every business gathering that has a focus on the Middle East. Report after report is putting the Kingdom in the top slot in terms of growth potential, business confidence, domestic demand, favourable demographics, retail dynamics, infrastructure development, construction boom, and imaginably every activity that has a bearing on economic progress. The Kingdom is being increasingly looked at as a potential game changer.
In fact, Saudi Arabia is now the toast of every business gathering that has a focus on the Middle East. Report after report is putting the Kingdom in the top slot in terms of growth potential, business confidence, domestic demand, favourable demographics, retail dynamics, infrastructure development, construction boom, and imaginably every activity that has a bearing on economic progress. The Kingdom is being increasingly looked at as a potential game changer.
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