#SaudiArabia Wealth Fund Builds Team to Hunt for Global Bargains - Bloomberg

Saudi Arabia Wealth Fund Builds Team to Hunt for Global Bargains - Bloomberg:

Saudi Arabia’s $320 billion sovereign wealth fund has reassigned some staff to finding quick trading wins in global markets battered by the coronavirus pandemic.

The Public Investment Fund, which until five years ago was a holding company for government stakes in domestic businesses, sees this as an opportunity to broaden its global portfolio, according to people familiar with the fund, who asked not to be identified because the matter is private. So far, its acquisition of stakes in energy and entertainment firms represent big bets that things will return to normal sooner than later as the world recovers from the pandemic shock.

PIF Recent Deals

Source: Bloomberg

The PIF is looking into “any opportunity” arising from the economic wreckage of the crisis, said the fund’s governor, Yasir Al-Rumayyan at a virtual event last week. The fund expects to see “lots of opportunities,” he said, citing airlines, energy and entertainment companies as examples.

The PIF’s mandate was broadened in 2015 by Crown Prince Mohammed bin Salman to include international investments to support economic diversification. It will take some massive home runs to make a difference for the oil-rich kingdom, which is losing foreign reserves at the fastest rate since at least 2000. The central bank’s net foreign assets last month dropped more than 5% from February to $464 billion, the lowest since 2011, according to data compiled by Bloomberg.

Finablr Group may owe $1.3bn, investigators find - Arabianbusiness

Finablr Group may owe $1.3bn, investigators find - Arabianbusiness:

Embattled payments and foreign exchange platform may owe at much as $1.3 billion, the company said on Thursday.

In a statement posted to the London Stock Exchange (LSE), Finablr said that its independent financial advisor, Houlihan Lokey and private investigators Kroll have been working to establish the current indebtedness position of the Finablr Group.

“The results of this exercise currently indicate that the total net indebtedness of the Finablr Group may be approximately $1,300 million (excluding any liabilities of the Travelex business),” the statement said. “This is materially above the last reported figure for the Group’s indebtedness position as at 30 June 2019 and the levels of indebtedness previously disclosed to the board.”

“The board cannot exclude the possibility that some of the proceeds of these borrowings may have been used for purposes outside of the Finablr Group,” it added.

Emirates, Etihad warn air travel recovery could take three years: business council - Reuters

Emirates, Etihad warn air travel recovery could take three years: business council - Reuters:

Middle East state carriers Emirates and Etihad Airways believe it could take three years for air travel demand to return to levels seen just before the COVID-19 pandemic broke out, according to the U.S. - UAE business council.

The business council hosted a video conference with Emirates President Tim Clark and Etihad Chief Executive Tony Douglas on Wednesday, it said.

Clark and Douglas both said during the conference that they believed 85% of the world’s airlines are at risk of insolvency, and that without state support could go bankrupt before year-end, according to the business council.

The airlines also warned it could take until 2023 for passenger demand to recover to pre-crisis levels.

MENA managers to boost Egypt funds, say #SaudiArabia and #UAE most vulnerable: Reuters poll - Reuters

MENA managers to boost Egypt funds, say Saudi Arabia and UAE most vulnerable: Reuters poll - Reuters:

Middle Eastern fund managers plan to increase investments in Egypt in the current quarter, according to a Reuters poll, and say Saudi Arabia and the United Arab Emirates are most vulnerable to tumbling oil prices and the coronavirus pandemic.

The region, which is mostly under lockdown as it deals with the outbreak, is home to many oil producers, who have seen the price of their main resource tumble as they spend to help support their economies. 


“Overall we expect the combination of COVID-19 and low oil prices to weigh on regional GDP growth, stress some of the weak corporate balance sheets and filter into earnings downgrades over the next few quarters,” said Mohamed Eljamal of Waha Capital.

Oil prices surge on last day of roller-coaster month - Reuters

Oil prices surge on last day of roller-coaster month - Reuters:

Oil prices jumped on Thursday, after several producers said they would cut output and as signs the U.S. crude glut was not growing as quickly as many had feared brought an upbeat close to one of the most volatile months for oil trading in history.

Fuel demand worldwide slumped about 30% in April. Even after major oil producers led by Saudi Arabia agreed to slash production by nearly 10 million barrels per day (bpd), U.S. crude futures closed on April 20 at a record low in negative territory.

That collapse in U.S. West Texas Intermediate (WTI) futures made traders frantic to avoid taking delivery as the May front-month contract expired, forcing traders to pay $37.63 a barrel at settlement to get rid of their contracts.

Prices have recovered somewhat but remain down over 60% since the start of the year.

On its last day as the front-month, Brent futures for June delivery rose $2.73, or 12%, to settle at $25.27 a barrel, while U.S. West Texas Intermediate (WTI) crude for June rose $3.78, or 25%, to settle at $18.84.

That was the highest close for Brent since April 20 and WTI since April 16.

Brent, the international benchmark, gained about 11% in April after falling more than 65% over the prior three months. WTI, meanwhile, fell for a fourth month in a row, dropping over 70% during that time, including an 8% loss in April.

The more actively traded Brent futures for July, which will soon be the front-month, gained about 9% to settle at $26.48 a barrel.

#UAE risks inclusion on money laundering watch list, watchdog warns | Financial Times

UAE risks inclusion on money laundering watch list, watchdog warns | Financial Times:

Dubai has diversified its economy away from oil but a buccaneering attitude to investment in property and commodities has exposed the emirate to criminality © Karim Sahib/AFP/Getty

UAE must take increased measures to stamp out money laundering or face inclusion on an international watch list, the world’s main dirty money monitoring group has warned.

The Financial Action Task Force on Thursday urged the Gulf state to prioritise the pursuit of international laundering networks, close loopholes in gold and property markets and work with international partners to tackle illegal financial flows.

If the UAE fails to take action in these areas within one year, the country will be placed on FAFT’s so-called “grey list” of 18 states that includes Yemen, Syria and Zimbabwe, in what would be a major blow to the country’s reputation as the Middle East’s main financial hub.

“Generally, fundamental and major improvements are needed across the UAE in order to demonstrate that the system cannot be used for money laundering and terrorist financing,” the Paris-based group said.

MIDEAST STOCKS-Oil buoys #Saudi market, ex-dividend stocks hurt #AbuDhabi - Reuters

MIDEAST STOCKS-Oil buoys Saudi market, ex-dividend stocks hurt Abu Dhabi - Reuters:

Saudi Arabia’s stock market extended gains from the previous session on Thursday, helped by the rise in oil prices, while the Abu Dhabi index was pressured by firms trading ex-dividend.

Brent was up 7.2%, or $1.63, at $24.17 a barrel by 0731 GMT, boosted by signs that the U.S. crude glut is easing and fuel demand battered by COVID-19 restrictions is starting to pick up.

On Wednesday, Brent settled at $22.54 a barrel, up $2.08, or 10.2%.

Saudi Arabia’s benchmark index added 1.2%, led by a 2% gain in Al Rajhi Bank and a 1.6% increase in oil giant Saudi Aramco.

#MBS: The Rise to Power of Mohammed bin Salman — a palace coup | Financial Times #SaudiArabia

MBS: The Rise to Power of Mohammed bin Salman — a palace coup | Financial Times:

Barring accident or assa­ssination, Mohammed bin Salman is destined to become king of Saudi Arabia, the first monarch of the third generation to rule the country founded by his grandfather Ibn Saud in 1932. At only 34, Crown Prince Mohammed — often known by his initials MBS — is already a deeply divisive figure.

He has won praise from supporters, including much of the country’s youth, as a long-awaited game-changer. His far-reaching plans — known as Vision 2030 — promise a future that will free the kingdom both from dependence on oil and the stifling effects of religious ultraconservatism. But critics and opponents see him as harbinger of a new Saudi nationalism, an accessory to murder and a ruthless dictator in the making whose fanatical hatred of Iran has split the consensus of Gulf states, boycotting Qatar and creating a humanitarian disaster in Yemen.

In this engaging account, Ben Hubbard shows both sides of the story, bringing his narrative alive with a host of insights, conversations, anecdotes and details. We learn how, as a young prince, Mohammed forged bonds with other teenagers by renting a fleet of jet skis for them. By royal Saudi standards, the family was not especially wealthy. Before becoming king, Mohammed’s father Salman, governor of Riyadh, had no personal “fortune”, unlike other princes who became hugely rich on commissions. 

Part of Prince Mohammed’s motivation, Hubbard suggests, may be driven by his envy of wealthier cousins. Hence the lavish spending on Bugattis, super yachts and an ersatz “Louis XIV” palace in the Paris suburbs, along with the milking of royal princes and wealthy merchants who were incarcerated in the Ritz-Carlton hotel in Riyadh until they paid up after admitting “corruption”. Up until his mid-twenties, “there was little reason to expect that he would become more than a middling prince who dabbled in business and pitched up abroad now and then for a fancy vacation”.

Norway to cut oil production by 13% | Financial Times

Norway to cut oil production by 13% | Financial Times:

Norway will cut its oil production for the first time in 18 years, as Western Europe’s largest crude producer moves to respond to the coronavirus-linked crash in fuel demand.

The country’s oil and energy ministry said late on Wednesday that it would order producers to curtail production by 250,000 barrels a day in June or more than 13 per cent of total output, as the country honours an unofficial pact with Opec and its allies to help shore up the market.

The move comes as oil demand is estimated to have crashed by as much as a third globally, with measures to curtail the spread of coronavirus hitting travel and the economy. Oil prices have dropped by more than 70 per cent since January, with Brent crude slumping below $20 a barrel for the first time in almost two decades last week.

“We are currently facing an unprecedented situation in the oil market,” said Tina Bru, Norway’s minister of petroleum and energy. “We have previously stated that we will consider a cut in Norwegian production if several big producing countries implement significant cuts.”

Credit profile of GCC banks to weaken over COVID-19, lower oil prices | ZAWYA MENA Edition

Credit profile of GCC banks to weaken over COVID-19, lower oil prices | ZAWYA MENA Edition:

Standalone credit profiles of GCC banks are set to weaken following the coronavirus pandemic and the drop-in oil prices, Fitch Ratings said.

GCC governments announced stimulus packages for their banking sectors to mitigate the economic impact of the pandemic, but Fitch expects banks' profitability and asset quality to deteriorate, leading to pressure on some banks' viability ratings.

“GCC countries announced monetary, fiscal and macro-prudential stimulus measures dwarfing any previously seen in the region. These are equivalent to significant proportions of GDP and could be increased if the crisis deepens,” the ratings agency said.

For example, the UAE and Saudi Arabia announced support packages of $77 billion and $56.5 billion respectively. This is over 15 percent of GDP for the UAE and over 7 percent of GDP for Saudi Arabia.

#UAE doing too little to stem money laundering and terrorist finance: watchdog - Reuters

UAE doing too little to stem money laundering and terrorist finance: watchdog - Reuters:

The United Arab Emirates is not doing enough to prevent money laundering despite recent progress, and causing concerns about its ability to combat financing of terrorism, the global dirty money monitoring group said on Thursday.

The U.S.-allied Gulf state, which includes the region’s financial and commercial centre Dubai, will now be put under a year-long observation by the Paris-based Financial Action Task Force (FATF).

The intergovernmental body said in a report that major or fundamental improvements are required in 10 of 11 areas evaluated for preventing money laundering and the financing of terrorism and weapons of mass destruction. 

The report, which took 14 months to compile and involved a visit to the UAE in July, gave a ‘low’ rating for investigation and prosecution of money laundering and a ‘moderate’ rating for preventive measures and financial sanctions related to countering the financing of terrorism.

#UAE News: #Dubai Islamic Bank Books $404 Million in Provisions - Bloomberg

UAE News: Dubai Islamic Bank Books $404 Million in Provisions - Bloomberg:

Dubai Islamic Bank PJSC set aside $404 million in provisions in the first quarter, joining its competitors in the Middle East business hub to prepare for the impact of the coronavirus on their loan books.

The Shariah-compliant lender’s impairments rose more than fourfold in the first three months from a year earlier as profit fell 17% to 1.11 billion dirhams ($302 million), according to a statement on Thursday.

“We have adopted a highly conservative approach to provisioning in this quarter building coverage and protection against any impacts on asset quality arising out of the current environment,” Chief Executive Officer Adnan Chilwan said in the statement.

Virus May Be a Welcome Reality Check for #Dubai’s Property Glut - Bloomberg

Virus May Be a Welcome Reality Check for Dubai’s Property Glut - Bloomberg:

Chairman of Damac Properties is adamant that his company will 

pull through.Hussain Sajwani spoke exclusively to Yousef Gamal el-Din.

 (

Source: Bloomberg)

While the coronavirus is wreaking havoc around the world, it could give Dubai’s long-slumping property market a much-needed break from new projects, a top developer said.

“If there is a silver lining to this crisis, it’s that now everybody is going to halt new projects at least for a while,” Hussain Sajwani, chairman of Damac Properties PJSC, said in an interview. “The reality on the ground is dictating the situation.”

Dubai’s developers have continued to build homes and start big new projects despite six years of falling prices and unmistakable signs of oversupply in the market. Now the double hit of the virus crisis and a partly related plunge in oil prices means buyers will have considerably less cash to pay for new homes. 


Developers have no choice but to halt projects “because their receivables are going to be huge” if they continue, Sajwani said.

Coronavirus will trigger biggest ever plunge in energy demand, emissions: IEA - Reuters

Coronavirus will trigger biggest ever plunge in energy demand, emissions: IEA - Reuters:

Economic lockdowns brought on by the coronavirus pandemic look set to cut global energy demand and carbon dioxide emissions by record amounts, the International Energy Agency (IEA) said on Thursday.

Global energy demand could slump by 6% in 2020 due to the restrictions placed on homes and industry in what would be the largest contraction in absolute terms on record, according to Paris-based IEA, which advises industrialised nations on energy.

The slump would lead to a drop in carbon dioxide emissions of 8%, six times larger than the biggest fall of 400 million tonnes recorded in 2009 following the global financial crisis, according to the IEA, which described its estimate as conservative.

“Some countries may delay the lifting of the lockdown, or a second wave of coronavirus could render our current expectations on the optimistic side,” the organisation’s executive director Fatih Birol told Reuters.

European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar mid-session

European, Middle Eastern & African Stocks - Bloomberg:

Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.

Oil prices rise amid early signs of fuel demand picking up - Reuters

Oil prices rise amid early signs of fuel demand picking up - Reuters:

Oil prices jumped on Thursday, buoyed by signs that the U.S. crude glut is not growing as quickly as expected and that fuel demand battered by COVID-19 restrictions is starting to pick up.

West Texas Intermediate (WTI) crude futures CLc1 climbed to a high of $17.75 a barrel and were up 9.2%, or $1.39, at $16.45 at 0640 GMT. The U.S. benchmark surged 22% on Wednesday.

Brent LCOc1 was up 5.6%, or $1.27 at $23.81 a barrel in light trading, with the June contract expiring on Thursday. The contract hit a high of $25 earlier in the session, having posted a 10% gain on Wednesday.

The most active Brent crude contract for July LCOc2 was up $1.15 or about 5%, at $25.38 a barrel.