Oil settles higher on stronger demand outlook as U.S inventories fall | Reuters
Oil prices settled higher on Wednesday as a drop in U.S. crude stockpiles reinforced expectations of improving demand ahead of the peak summer driving season, offsetting worries that a possible return of Iranian supply would cause a glut.
Brent settled up 16 cents, or 0.3%, to $68.87 a barrel and U.S. West Texas Intermediate (WTI) crude settled up 14 cents, or 0.2%, at $66.21 a barrel.
Both benchmarks pared losses after government data showed U.S. crude stocks at the Cushing, Oklahoma, storage hub fell last week to the lowest since March 2020. Refiners ramped up utilization rates to pre-pandemic levels.
Gasoline product supplied rose to 9.5 million barrels per day, a proxy for demand, while distillate demand was also higher. Gasoline consumption generally rises beginning around U.S. Memorial Day, which is May 31 this year, when people take to the roads.
Prices found some support from lifting of coronavirus curbs.
Wednesday, 26 May 2021
#Dubai Property Fund Unswayed by Creditor Dissent in Debt Dispute - Bloomberg
Dubai Property Fund Unswayed by Creditor Dissent in Debt Dispute - Bloomberg
Dubai-listed Emirates REIT made no indication it’s willing to compromise with a group of creditors that rejected its proposal to exchange $400 million of sukuk securities for new notes.
A dispute with investors escalated on Wednesday after the dissenting certificate-holders said they have the numbers to block the offer and asked for a meeting with the company the following day “to discuss the concerns of the Ad-Hoc Group and its requirements for the restructuring process.” Rothschild & Co. and Clifford Chance are advising the group.
In response, Emirates REIT said voting to accept its restructuring proposal remains open and reiterated that it has sufficient cash on hand to pay “the profit payment” due next month, if necessary. It didn’t say whether it would accept the invitation to meet on Thursday.
The creditors formed a so-called steering committee that includes several certificate-holders with large exposure to lead the talks with Emirates REIT, according to a separate document seen by Bloomberg. The steering committee consists of Aberdeen Standard Investments Ltd, GFH Financial Group, Sancta Capital, Shuaa Capital PSC and Oasis Management Co Ltd, the document showed.
Emirates REIT, whose portfolio ranges from schools to office space, has said it needs to improve its balance sheet after the global pandemic compounded a property slump in Dubai.
The Shariah-compliant real estate investment trust last week offered to exchange the unsecured sukuk securities due in 2022 for new secured notes maturing in 2024. Under the plan, the REIT’s coupon payments would be deferred for a year and be paid at maturity. The existing sukuk’s 5.125% rate is to be maintained.
The proposed transaction would represent “a material reduction in terms for lenders and is therefore viewed” as a distressed debt exchange, according to Fitch Ratings, which downgraded the Dubai-listed REIT to near-default status on Monday.
The REIT last year hired Houlihan Lokey Inc. as an adviser to help it review its options and has been considering a potential delisting from Nasdaq Dubai. It’s also said that the Dubai Financial Services Authority is investigating matters connected to its management.
The group of dissenting creditors said it represents a blocking majority to the offer and includes 13 institutions, with investors from the Gulf region, Europe, North America and Asia, alongside banks from the United Arab Emirates. It set out a list of conditions to develop a revised proposal, saying it would have to address issues ranging from governance to management fees and operating costs.
“The Ad-Hoc Group is prepared to work to reach a quick and efficient resolution,” it said in the statement.
Dubai-listed Emirates REIT made no indication it’s willing to compromise with a group of creditors that rejected its proposal to exchange $400 million of sukuk securities for new notes.
A dispute with investors escalated on Wednesday after the dissenting certificate-holders said they have the numbers to block the offer and asked for a meeting with the company the following day “to discuss the concerns of the Ad-Hoc Group and its requirements for the restructuring process.” Rothschild & Co. and Clifford Chance are advising the group.
In response, Emirates REIT said voting to accept its restructuring proposal remains open and reiterated that it has sufficient cash on hand to pay “the profit payment” due next month, if necessary. It didn’t say whether it would accept the invitation to meet on Thursday.
The creditors formed a so-called steering committee that includes several certificate-holders with large exposure to lead the talks with Emirates REIT, according to a separate document seen by Bloomberg. The steering committee consists of Aberdeen Standard Investments Ltd, GFH Financial Group, Sancta Capital, Shuaa Capital PSC and Oasis Management Co Ltd, the document showed.
Emirates REIT, whose portfolio ranges from schools to office space, has said it needs to improve its balance sheet after the global pandemic compounded a property slump in Dubai.
The Shariah-compliant real estate investment trust last week offered to exchange the unsecured sukuk securities due in 2022 for new secured notes maturing in 2024. Under the plan, the REIT’s coupon payments would be deferred for a year and be paid at maturity. The existing sukuk’s 5.125% rate is to be maintained.
The proposed transaction would represent “a material reduction in terms for lenders and is therefore viewed” as a distressed debt exchange, according to Fitch Ratings, which downgraded the Dubai-listed REIT to near-default status on Monday.
The REIT last year hired Houlihan Lokey Inc. as an adviser to help it review its options and has been considering a potential delisting from Nasdaq Dubai. It’s also said that the Dubai Financial Services Authority is investigating matters connected to its management.
The group of dissenting creditors said it represents a blocking majority to the offer and includes 13 institutions, with investors from the Gulf region, Europe, North America and Asia, alongside banks from the United Arab Emirates. It set out a list of conditions to develop a revised proposal, saying it would have to address issues ranging from governance to management fees and operating costs.
“The Ad-Hoc Group is prepared to work to reach a quick and efficient resolution,” it said in the statement.
MIDEAST STOCKS Most major Gulf markets gain; #AbuDhabi falls | Reuters
MIDEAST STOCKS Most major Gulf markets gain; Abu Dhabi falls | Reuters
Most major stock markets in the Gulf ended higher on Wednesday, with the Dubai index leading gains on back of top lender Emirates NBD.
Saudi Arabia's benchmark index (.TASI) added 0.2%, supported by a 5.5% rise in Dr Sulaiman Al-Habib Medical Services (4013.SE).
The value of Saudi Arabia's oil exports in March rose by 75% year on year to 52.3 billion riyals ($13.95 billion), official data showed on Wednesday. read more
Non-oil exports increased by 42.9% to 22.4 billion riyals, the General Authority for Statistics said.
Dubai's main share index (.DFMGI) advanced 1%, boosted by a 4.6% increase in Emirates NBD (ENBD.DU).
Last week, the bank sold $750 million in Additional Tier 1 bonds after receiving more than $1.75 billion in orders, a document showed.
Amazon.com Inc (AMZN.O) said on Wednesday its cloud service unit will launch three data centres in the first half of 2022 in the United Arab Emirates, its second Middle East infrastructure region. read more
"The UAE seems to be extending its efforts to welcome international business as the Minister of Economy, Abdulla Bin Touq Al-Marri said in an interview that the UAE aims to double its economy to 3 trillion dirhams ($816.82 billion) over the next decade," said Mohamad Ibrahim, regional director Middle East at Exness.
However, sharia-compliant lender Dubai Islamic Bank (DISB.DU) gave up early gains to close flat.
A judge in Abu Dhabi ruled in favour of Dubai Islamic Bank and against the administrators of NMC, in a case that could complicate the private healthcare firm's multi-billion-dollar debt restructuring. read more
In Abu Dhabi, the index (.ADI) fell 1%, ending three sessions of gains, with the country's largest lender First Abu Dhabi Bank (FAB.AD) down 2.6%.
Abu Dhabi sold $2 billion in seven-year bonds on Tuesday in its first foray into international debt markets this year, raising cash for state coffers despite a recent rebound in oil prices. read more
The Qatari benchmark (.QSI) edged up 0.2%, with petrochemical firm Industries Qatar (IQCD.QA) rising 2.6%.
Outside the Gulf, Egypt's blue-chip index (.EGX30) declined 1.5%, weighed down by a 4.2% fall in Commercial International Bank (COMI.CA) and a 2.7% decrease in Fawry for Banking Technology and Electronic (FWRY.CA).
Most major stock markets in the Gulf ended higher on Wednesday, with the Dubai index leading gains on back of top lender Emirates NBD.
Saudi Arabia's benchmark index (.TASI) added 0.2%, supported by a 5.5% rise in Dr Sulaiman Al-Habib Medical Services (4013.SE).
The value of Saudi Arabia's oil exports in March rose by 75% year on year to 52.3 billion riyals ($13.95 billion), official data showed on Wednesday. read more
Non-oil exports increased by 42.9% to 22.4 billion riyals, the General Authority for Statistics said.
Dubai's main share index (.DFMGI) advanced 1%, boosted by a 4.6% increase in Emirates NBD (ENBD.DU).
Last week, the bank sold $750 million in Additional Tier 1 bonds after receiving more than $1.75 billion in orders, a document showed.
Amazon.com Inc (AMZN.O) said on Wednesday its cloud service unit will launch three data centres in the first half of 2022 in the United Arab Emirates, its second Middle East infrastructure region. read more
"The UAE seems to be extending its efforts to welcome international business as the Minister of Economy, Abdulla Bin Touq Al-Marri said in an interview that the UAE aims to double its economy to 3 trillion dirhams ($816.82 billion) over the next decade," said Mohamad Ibrahim, regional director Middle East at Exness.
However, sharia-compliant lender Dubai Islamic Bank (DISB.DU) gave up early gains to close flat.
A judge in Abu Dhabi ruled in favour of Dubai Islamic Bank and against the administrators of NMC, in a case that could complicate the private healthcare firm's multi-billion-dollar debt restructuring. read more
In Abu Dhabi, the index (.ADI) fell 1%, ending three sessions of gains, with the country's largest lender First Abu Dhabi Bank (FAB.AD) down 2.6%.
Abu Dhabi sold $2 billion in seven-year bonds on Tuesday in its first foray into international debt markets this year, raising cash for state coffers despite a recent rebound in oil prices. read more
The Qatari benchmark (.QSI) edged up 0.2%, with petrochemical firm Industries Qatar (IQCD.QA) rising 2.6%.
Outside the Gulf, Egypt's blue-chip index (.EGX30) declined 1.5%, weighed down by a 4.2% fall in Commercial International Bank (COMI.CA) and a 2.7% decrease in Fawry for Banking Technology and Electronic (FWRY.CA).
#UAE's #AbuDhabi Islamic Bank funds Rasmala's UK property acquisition | ZAWYA MENA Edition
UAE's Abu Dhabi Islamic Bank funds Rasmala's UK property acquisition | ZAWYA MENA Edition
Abu Dhabi Islamic Bank (ADIB) has provided structured Islamic financing worth GBP 28.6 million ($40.5 million) to Rasmala Long Income Fund to support its acquisition of a supermarket investment in the UK.
The property, which was constructed in 2012, is leased to supermarket chain Tesco Stores Limited. The 25-year lease has nearly 16 years remaining and yields a rent of GBP1.46 million per annum which is subject to five yearly index-linked upwards only rent reviews, according to ADIB.
Rasmala Long Income Fund has a diversified portfolio of real estate assets covering the UK, Europe and North America with a current net asset value in excess of $250 million. The fund is managed by Rasmala Investment Bank Limited which is regulated by the Dubai Financial Services Authority.
Rasmala Long Income Fund was advised by Eversheds and ADIB was advised by CMS Cameron McKenna Nabarro Olswang LLP and Collas Crill.
Abu Dhabi Islamic Bank (ADIB) has provided structured Islamic financing worth GBP 28.6 million ($40.5 million) to Rasmala Long Income Fund to support its acquisition of a supermarket investment in the UK.
The property, which was constructed in 2012, is leased to supermarket chain Tesco Stores Limited. The 25-year lease has nearly 16 years remaining and yields a rent of GBP1.46 million per annum which is subject to five yearly index-linked upwards only rent reviews, according to ADIB.
Rasmala Long Income Fund has a diversified portfolio of real estate assets covering the UK, Europe and North America with a current net asset value in excess of $250 million. The fund is managed by Rasmala Investment Bank Limited which is regulated by the Dubai Financial Services Authority.
Rasmala Long Income Fund was advised by Eversheds and ADIB was advised by CMS Cameron McKenna Nabarro Olswang LLP and Collas Crill.
ADNOC to offer approximately 375mln shares in ADNOC Distribution | ZAWYA MENA Edition
ADNOC to offer approximately 375mln shares in ADNOC Distribution | ZAWYA MENA Edition
The Abu Dhabi National Oil Company (ADNOC) will offer approximately 375 million shares in ADNOC Distribution at a price of AED 4.36 per share ($1.19).
The UAE oil giant will also issue approximately $1.195 billion of exchangeable bonds through a combined offering with a total transaction size of close to $1.640 billion, it said in a statement.
The senior unsecured bonds are due on 2024 and exchangeable under certain conditions into existing common shares of ADNOC Distribution constituting 7 percent of the registered share capital
Final terms of the combined offering are expected to be announced following completion of the bookbuild for the share offering and exchangeable bond offering.
The combined offering is another milestone in enabling ADNOC to further unlock and monetize significant value from its assets, whilst also increasing the free float of ADNOC Distribution, boosting liquidity in its shares and diversifying its shareholder base.
The Abu Dhabi National Oil Company (ADNOC) will offer approximately 375 million shares in ADNOC Distribution at a price of AED 4.36 per share ($1.19).
The UAE oil giant will also issue approximately $1.195 billion of exchangeable bonds through a combined offering with a total transaction size of close to $1.640 billion, it said in a statement.
The senior unsecured bonds are due on 2024 and exchangeable under certain conditions into existing common shares of ADNOC Distribution constituting 7 percent of the registered share capital
Final terms of the combined offering are expected to be announced following completion of the bookbuild for the share offering and exchangeable bond offering.
The combined offering is another milestone in enabling ADNOC to further unlock and monetize significant value from its assets, whilst also increasing the free float of ADNOC Distribution, boosting liquidity in its shares and diversifying its shareholder base.
Buy now, pay later players tackle credit conundrum in Mideast’s Gulf | Reuters
Buy now, pay later players tackle credit conundrum in Mideast’s Gulf | Reuters
Financial technology start-ups in Saudi Arabia and the United Arab Emirates offering online short-term credit say they are enjoying exponential growth as the coronavirus pandemic drives a shift in consumer spending online.
Digital buy now, pay later (BNPL) purchasing is relatively new to the region where consumers have traditionally been sceptical of paying for goods before getting them.
But Saudi Arabian-based Tamara and UAE's Spotii, Tabby and Postpay all say the take-up has far exceeded initial expectations. And investors are paying attention. Tamara last month raised $110 million in debt and equity, a large amount for an early stage Middle East start-up.
This week, Australia's second biggest BNPL player Zip (Z1P.AX) said it was buying the rest of the shares in Spotii it did not already own for $16 million. Tabby has raised over $30 million including funding from Abu Dhabi state fund Mubadala.
"We're constantly having to re-forecast our numbers just because we constantly get surprised by the consumer adoption," Tabby Co-Founder and Chief Executive Hosam Arab told Reuters.
There is no independent data available on the Middle East BNPL market which also includes Shahry in Egypt; all of the companies in the sector are early stage start-ups and many only began operating last year.
In the United States, Australia and Europe, BNPL is marketed as an alternative to credit cards. During the pandemic, with consumers conserving cash and seeking alternative methods of borrowing money, the service exploded in popularity.
In the Gulf, BNPL companies present themselves as an alternative to cash on delivery, the most common payment method for online purchases in many Middle East countries, according to a 2018 report by British security firm G4S.
But Anil Malhotra, chief marketing officer of digital payments business Bango, said a cultural challenge for BNPL in the Gulf was to make sure it "doesn't look or smell like credit."
Islamic customs prohibit charging interests on loans, which has deterred some Middle East consumers from using credit cards.
Saudi Arabian independent retailer Crate, which introduced Tamara on its website last August, has found that while those checking out with BNPL had become repeat users, most customers preferred to pay by card or cash on delivery.
Half of all purchases are paid with card, while cash on delivery accounts for 40% of all online transactions with BNPL making up 10%, Chief Executive Rayan Fadul told Reuters.
BNPL is still new to the region's consumers who are wary of using a product they don't yet fully understand, he believes.
"They would like to see other people talk about it first and maybe explain to them how easy it is."
Financial technology start-ups in Saudi Arabia and the United Arab Emirates offering online short-term credit say they are enjoying exponential growth as the coronavirus pandemic drives a shift in consumer spending online.
Digital buy now, pay later (BNPL) purchasing is relatively new to the region where consumers have traditionally been sceptical of paying for goods before getting them.
But Saudi Arabian-based Tamara and UAE's Spotii, Tabby and Postpay all say the take-up has far exceeded initial expectations. And investors are paying attention. Tamara last month raised $110 million in debt and equity, a large amount for an early stage Middle East start-up.
This week, Australia's second biggest BNPL player Zip (Z1P.AX) said it was buying the rest of the shares in Spotii it did not already own for $16 million. Tabby has raised over $30 million including funding from Abu Dhabi state fund Mubadala.
"We're constantly having to re-forecast our numbers just because we constantly get surprised by the consumer adoption," Tabby Co-Founder and Chief Executive Hosam Arab told Reuters.
There is no independent data available on the Middle East BNPL market which also includes Shahry in Egypt; all of the companies in the sector are early stage start-ups and many only began operating last year.
In the United States, Australia and Europe, BNPL is marketed as an alternative to credit cards. During the pandemic, with consumers conserving cash and seeking alternative methods of borrowing money, the service exploded in popularity.
In the Gulf, BNPL companies present themselves as an alternative to cash on delivery, the most common payment method for online purchases in many Middle East countries, according to a 2018 report by British security firm G4S.
But Anil Malhotra, chief marketing officer of digital payments business Bango, said a cultural challenge for BNPL in the Gulf was to make sure it "doesn't look or smell like credit."
Islamic customs prohibit charging interests on loans, which has deterred some Middle East consumers from using credit cards.
Saudi Arabian independent retailer Crate, which introduced Tamara on its website last August, has found that while those checking out with BNPL had become repeat users, most customers preferred to pay by card or cash on delivery.
Half of all purchases are paid with card, while cash on delivery accounts for 40% of all online transactions with BNPL making up 10%, Chief Executive Rayan Fadul told Reuters.
BNPL is still new to the region's consumers who are wary of using a product they don't yet fully understand, he believes.
"They would like to see other people talk about it first and maybe explain to them how easy it is."
Gulf 2021 deficits to fall to $80 bln on higher oil - S&P | Reuters
Gulf 2021 deficits to fall to $80 bln on higher oil - S&P | Reuters
Budget deficits of the six Gulf Cooperation Council countries are expected to drop sharply this year, supported by higher oil prices, fiscal consolidation and a rebound in economic output as coronavirus measures are eased, S&P Global Ratings said.
The aggregate deficits of the central governments of the GCC are expected at about $80 billion this year from $143 billion in 2020, S&P said in a report on Wednesday.
"Nevertheless, still-high GCC central government deficits will result in continued balance sheet deterioration in most cases," S&P said. But it noted that, with the exception of Kuwait and Bahrain, the countries' budgetary performance was stronger than in 2016 - the prior oil price crash.
The Gulf was hammered by the double shock of a historic crash in oil prices last year as well as the economic impact of the coronavirus pandemic and related health safety measures.
Higher oil prices, while supportive for GCC sovereign ratings, have in the past derailed consolidation reforms and therefore led to higher spending or delays in planned fiscal reforms, S&P said.
"Many Gulf states have shown spending restraint in response to the double external shocks of 2020 ... (and some) have also made inroads to diversifying their government revenue streams away from hydrocarbons," S&P said.
Saudi Arabia tripled a value-added tax last year to boost state finances hurt by the coronavirus crisis and lower oil revenues, while Oman introduced VAT for the first time last month.
"We expect fiscal deficits will reduce over 2021-2022 and widen again in 2023-2024 given our oil price assumptions, as well as the gradual tapering of oil production cuts in line with the May 2021 OPEC+ agreement," the ratings agency said.
It assumed a Brent crude price of $60 per barrel for the rest of 2021, the same in 2022 and $55 per barrel from 2023.
S&P expected GCC government debt issuance to average about $50 billion per year from 2021 to 2024, compared to $70 billion last year and close to $100 billion in 2017.
Budget deficits of the six Gulf Cooperation Council countries are expected to drop sharply this year, supported by higher oil prices, fiscal consolidation and a rebound in economic output as coronavirus measures are eased, S&P Global Ratings said.
The aggregate deficits of the central governments of the GCC are expected at about $80 billion this year from $143 billion in 2020, S&P said in a report on Wednesday.
"Nevertheless, still-high GCC central government deficits will result in continued balance sheet deterioration in most cases," S&P said. But it noted that, with the exception of Kuwait and Bahrain, the countries' budgetary performance was stronger than in 2016 - the prior oil price crash.
The Gulf was hammered by the double shock of a historic crash in oil prices last year as well as the economic impact of the coronavirus pandemic and related health safety measures.
Higher oil prices, while supportive for GCC sovereign ratings, have in the past derailed consolidation reforms and therefore led to higher spending or delays in planned fiscal reforms, S&P said.
"Many Gulf states have shown spending restraint in response to the double external shocks of 2020 ... (and some) have also made inroads to diversifying their government revenue streams away from hydrocarbons," S&P said.
Saudi Arabia tripled a value-added tax last year to boost state finances hurt by the coronavirus crisis and lower oil revenues, while Oman introduced VAT for the first time last month.
"We expect fiscal deficits will reduce over 2021-2022 and widen again in 2023-2024 given our oil price assumptions, as well as the gradual tapering of oil production cuts in line with the May 2021 OPEC+ agreement," the ratings agency said.
It assumed a Brent crude price of $60 per barrel for the rest of 2021, the same in 2022 and $55 per barrel from 2023.
S&P expected GCC government debt issuance to average about $50 billion per year from 2021 to 2024, compared to $70 billion last year and close to $100 billion in 2017.
Emirates REIT Debt Exchange Offer Rejected by Group of Creditors - Bloomberg
Emirates REIT Debt Exchange Offer Rejected by Group of Creditors - Bloomberg
A group of Emirates REIT creditors has rejected a proposal to exchange $400 million of sukuk securities for new notes and said they have the numbers to block it.
In a statement on Wednesday, the certificate-holders said their position was communicated to the company and asked for a meeting the following day “to discuss the concerns of the Ad-Hoc Group and its requirements for the restructuring process.” Rothschild & Co. and Clifford Chance are advising the group.
The creditors formed a so-called steering committee that includes several certificate-holders with large exposure to lead the talks with Emirates REIT, according to a separate document seen by Bloomberg. The steering committee consists of Aberdeen Standard Investments Ltd, GFH Financial Group, Sancta Capital, Shuaa Capital PSC and Oasis Management Co Ltd, the document showed.
The Shariah-compliant real estate investment trust last week offered to exchange the unsecured sukuk securities due in 2022 for new secured notes maturing in 2024. Under the plan, the REIT’s coupon payments would be deferred for a year and be paid at maturity. The existing sukuk’s 5.125% rate is to be maintained.
The proposed transaction would represent “a material reduction in terms for lenders and is therefore viewed” as a distressed debt exchange, according to Fitch Ratings, which downgraded the Dubai-listed REIT to near-default status on Monday.
Emirates REIT has said it needs to improve its balance sheet after the global pandemic compounded a property slump in Dubai.
The REIT last year hired Houlihan Lokey Inc. as an adviser to help it review its options and has been considering a potential delisting from Nasdaq Dubai. It’s also said that the Dubai Financial Services Authority is investigating matters connected to its management.
The group of dissenting creditors said it represents a blocking majority to the offer and includes 13 institutions, with investors from the Gulf region, Europe, North America and Asia, alongside banks from the United Arab Emirates. It set out a list of conditions to develop a revised proposal, saying it would have to address issues ranging from governance to management fees and operating costs.
“The Ad-Hoc Group is prepared to work to reach a quick and efficient resolution,” it said in the statement.
A group of Emirates REIT creditors has rejected a proposal to exchange $400 million of sukuk securities for new notes and said they have the numbers to block it.
In a statement on Wednesday, the certificate-holders said their position was communicated to the company and asked for a meeting the following day “to discuss the concerns of the Ad-Hoc Group and its requirements for the restructuring process.” Rothschild & Co. and Clifford Chance are advising the group.
The creditors formed a so-called steering committee that includes several certificate-holders with large exposure to lead the talks with Emirates REIT, according to a separate document seen by Bloomberg. The steering committee consists of Aberdeen Standard Investments Ltd, GFH Financial Group, Sancta Capital, Shuaa Capital PSC and Oasis Management Co Ltd, the document showed.
The Shariah-compliant real estate investment trust last week offered to exchange the unsecured sukuk securities due in 2022 for new secured notes maturing in 2024. Under the plan, the REIT’s coupon payments would be deferred for a year and be paid at maturity. The existing sukuk’s 5.125% rate is to be maintained.
The proposed transaction would represent “a material reduction in terms for lenders and is therefore viewed” as a distressed debt exchange, according to Fitch Ratings, which downgraded the Dubai-listed REIT to near-default status on Monday.
Emirates REIT has said it needs to improve its balance sheet after the global pandemic compounded a property slump in Dubai.
The REIT last year hired Houlihan Lokey Inc. as an adviser to help it review its options and has been considering a potential delisting from Nasdaq Dubai. It’s also said that the Dubai Financial Services Authority is investigating matters connected to its management.
The group of dissenting creditors said it represents a blocking majority to the offer and includes 13 institutions, with investors from the Gulf region, Europe, North America and Asia, alongside banks from the United Arab Emirates. It set out a list of conditions to develop a revised proposal, saying it would have to address issues ranging from governance to management fees and operating costs.
“The Ad-Hoc Group is prepared to work to reach a quick and efficient resolution,” it said in the statement.
Review: #Saudi banks' Q1 aggregate net income up 20% on year | ZAWYA MENA Edition
Review: Saudi banks' Q1 aggregate net income up 20% on year | ZAWYA MENA Edition
The cumulative net income of Saudi Arabia’s listed banks in the first quarter of 2021 excluding Samba Financial Group, improved 20 percent year-on-year on the back of lower provisions, higher non-financing income and improved efficiency, said Al Rajhi Capital in a note.
The Riyadh-based investment bank said, however, that net interest margin (NIM) fell due to the low interest rate environment and the decline in mortgage financing rates. NIM is the difference between a bank’s income from loans and mortgages and what it pays out on liabilities and constitutes is a key component of Saudi banks’ profitability.
Aggregate net income increased by about 20 percent y-o-y in Q1 supported mainly by a 27 percent y-o-y rise in non-financing income and a 21 percent lower provisioning. This helped offset the drop in NIM, the investment bank said.
Loan assets grew 13 percent y-o-y with nearly 40 percent of the new loans underpinned by robust mortgage origination. Al Rajhi Bank, Albilad and Alinma Banks led the growth with loan book expanding 13percent q-o-q, 8 percent and 5 percent respectively. No bank showed contraction in its loan book.
Deposit growth was also largely driven by the same set of banks with Al Rajhi, Albilad and Banque Saudi Fransi growing by 10 percent, 8 percent and 5 percent.
Overall, the percentage of non-performing assets (NPA) dropped 9 basis points to 2.14 percent on a sequential basis in the first quarter. The average coverage ratio improved to 135 percent from 131 percent at the end of Q4 20202 as the Saudi Central Bank’s loan deferral program continues.
For full-year 2021, Al Rajhi Capital said support to lending growth from mortgages will continue amid strong demand and favourable demographics in the kingdom. However, the margins remain susceptible to a possible increase in cost of financing eventually, it added.
Banks could benefit from the various mega projects that are in the pipeline, the note added.
“We note here that non-financing income has positively surprised us supported by payments, brokerage and treasury activities…Accordingly, we see aggregate bottom line to post a healthy growth of 16 percent in FY21. Also, considering lower than average dividend in FY20 (approximately 29 percent average payout ratio) and adequate capital position of most banks, aggregate dividend payout ratio is likely to improve this year.”
Samba has not reported its financial results for the quarter following its merger with National Commercial Bank to form the combined entity, Saudi National Bank.
The cumulative net income of Saudi Arabia’s listed banks in the first quarter of 2021 excluding Samba Financial Group, improved 20 percent year-on-year on the back of lower provisions, higher non-financing income and improved efficiency, said Al Rajhi Capital in a note.
The Riyadh-based investment bank said, however, that net interest margin (NIM) fell due to the low interest rate environment and the decline in mortgage financing rates. NIM is the difference between a bank’s income from loans and mortgages and what it pays out on liabilities and constitutes is a key component of Saudi banks’ profitability.
Aggregate net income increased by about 20 percent y-o-y in Q1 supported mainly by a 27 percent y-o-y rise in non-financing income and a 21 percent lower provisioning. This helped offset the drop in NIM, the investment bank said.
Loan assets grew 13 percent y-o-y with nearly 40 percent of the new loans underpinned by robust mortgage origination. Al Rajhi Bank, Albilad and Alinma Banks led the growth with loan book expanding 13percent q-o-q, 8 percent and 5 percent respectively. No bank showed contraction in its loan book.
Deposit growth was also largely driven by the same set of banks with Al Rajhi, Albilad and Banque Saudi Fransi growing by 10 percent, 8 percent and 5 percent.
Overall, the percentage of non-performing assets (NPA) dropped 9 basis points to 2.14 percent on a sequential basis in the first quarter. The average coverage ratio improved to 135 percent from 131 percent at the end of Q4 20202 as the Saudi Central Bank’s loan deferral program continues.
For full-year 2021, Al Rajhi Capital said support to lending growth from mortgages will continue amid strong demand and favourable demographics in the kingdom. However, the margins remain susceptible to a possible increase in cost of financing eventually, it added.
Banks could benefit from the various mega projects that are in the pipeline, the note added.
“We note here that non-financing income has positively surprised us supported by payments, brokerage and treasury activities…Accordingly, we see aggregate bottom line to post a healthy growth of 16 percent in FY21. Also, considering lower than average dividend in FY20 (approximately 29 percent average payout ratio) and adequate capital position of most banks, aggregate dividend payout ratio is likely to improve this year.”
Samba has not reported its financial results for the quarter following its merger with National Commercial Bank to form the combined entity, Saudi National Bank.
#AbuDhabi to Build $1 Billion Green Hydrogen and Ammonia Plant - Bloomberg
Abu Dhabi to Build $1 Billion Green Hydrogen and Ammonia Plant - Bloomberg
Abu Dhabi said a private company will spend more than $1 billion to build a solar-powered hydrogen and ammonia plant, as investors and governments in the Middle East step up efforts to develop emissions-free energy.
The facility will be located at the Khalifa Industrial Zone and built by Helios Industry, according to state-run Abu Dhabi Ports Co. The project will initially include 100 megawatts of solar capacity, rising to 800 megawatts in the future, Abu Dhabi Ports said in a statement. The hydrogen that’s produced will be converted into ammonia for export.
At peak capacity, the plant will produce 40,000 tons a year of green hydrogen, which will be used to make 200,000 tons of ammonia.
Dubai, Oman and Saudi Arabia have also announced plans to manufacture green hydrogen. The fuel is created when renewable energy is used to split water atoms, in a process that leads to no carbon emissions.
Hydrogen, which emits only water vapor when burned, is seen as crucial for the switch from oil and gas to cleaner fuels. The technology to make it is still expensive, however, and it’s expected to remain a small market for at least the next several years.
Abu Dhabi’s state oil company, known as Adnoc, announced a plan this week to develop what’s known as blue ammonia. That’s produced when natural gas is converted into hydrogen with the carbon-dioxide emissions being captured.
Abu Dhabi said a private company will spend more than $1 billion to build a solar-powered hydrogen and ammonia plant, as investors and governments in the Middle East step up efforts to develop emissions-free energy.
The facility will be located at the Khalifa Industrial Zone and built by Helios Industry, according to state-run Abu Dhabi Ports Co. The project will initially include 100 megawatts of solar capacity, rising to 800 megawatts in the future, Abu Dhabi Ports said in a statement. The hydrogen that’s produced will be converted into ammonia for export.
At peak capacity, the plant will produce 40,000 tons a year of green hydrogen, which will be used to make 200,000 tons of ammonia.
Dubai, Oman and Saudi Arabia have also announced plans to manufacture green hydrogen. The fuel is created when renewable energy is used to split water atoms, in a process that leads to no carbon emissions.
Hydrogen, which emits only water vapor when burned, is seen as crucial for the switch from oil and gas to cleaner fuels. The technology to make it is still expensive, however, and it’s expected to remain a small market for at least the next several years.
Abu Dhabi’s state oil company, known as Adnoc, announced a plan this week to develop what’s known as blue ammonia. That’s produced when natural gas is converted into hydrogen with the carbon-dioxide emissions being captured.
Oil slips on fears of supply glut from possible return of Iranian supply | Reuters
Oil slips on fears of supply glut from possible return of Iranian supply | Reuters
Oil inched lower on Wednesday as worries that a possible return of Iranian supply would cause a glut outweighed expectations of improving U.S. fuel demand that were reinforced by a drop in weekly inventory estimates.
Brent crude oil futures for July fell 6 cents, or 0.1%, to $68.59 a barrel by 0434 GMT, while U.S. West Texas Intermediate (WTI) crude for July was at $65.92 a barrel, down 15 cents, or 0.2%.
Both benchmarks edged higher on Tuesday, ending at their highest levels in a week, amid hopes for higher demand fed by the approach of the northern hemisphere’s summer driving season and a lifting of coronavirus curbs.
U.S. crude oil and fuel inventories fell last week, said two market sources, citing Tuesday’s American Petroleum Institute figures.
Crude stocks fell by 439,000 barrels in the week ended May 21. Gasoline inventories fell by 2 million barrels and distillate stocks fell by 5.1 million barrels, the data showed, according to the sources.
Oil inched lower on Wednesday as worries that a possible return of Iranian supply would cause a glut outweighed expectations of improving U.S. fuel demand that were reinforced by a drop in weekly inventory estimates.
Brent crude oil futures for July fell 6 cents, or 0.1%, to $68.59 a barrel by 0434 GMT, while U.S. West Texas Intermediate (WTI) crude for July was at $65.92 a barrel, down 15 cents, or 0.2%.
Both benchmarks edged higher on Tuesday, ending at their highest levels in a week, amid hopes for higher demand fed by the approach of the northern hemisphere’s summer driving season and a lifting of coronavirus curbs.
U.S. crude oil and fuel inventories fell last week, said two market sources, citing Tuesday’s American Petroleum Institute figures.
Crude stocks fell by 439,000 barrels in the week ended May 21. Gasoline inventories fell by 2 million barrels and distillate stocks fell by 5.1 million barrels, the data showed, according to the sources.
MIDEAST STOCKS Most major Gulf markets gain as financials rise | Reuters
MIDEAST STOCKS Most major Gulf markets gain as financials rise | Reuters
Most major stock markets in the Gulf rose in early trade on Wednesday, supported by gains in their financial stocks, although Abu Dhabi bucked the trend to trade lower.
Saudi Arabia's benchmark index (.TASI) edged up 0.2%, helped by a 0.2% gain in Al Rajhi Bank (1120.SE) and a 0.3% increase in Saudi Basic Industries (2010.SE).
The value of Saudi Arabia's oil exports in March rose by 75% year on year to 52.3 billion riyals ($13.95 billion), official data showed on Wednesday. read more
Non-oil exports increased by 42.9% to 22.4 billion riyals, the General Authority for Statistics said.
Dubai's main share index (.DFMGI) added 0.3%, with its top lender Emirates NBD (ENBD.DU) gaining 1.2%, while sharia-compliant lender Dubai Islamic Bank (DISB.DU) was up 0.4%.
A judge in Abu Dhabi ruled in favour of Dubai Islamic Bank and against the administrators of NMC, in a case that could complicate the private healthcare firm's multi-billion-dollar debt restructuring. read more
NMC ran into trouble last year after the disclosure of more than $4 billion in hidden debt and its UAE operating businesses were placed into administration in the courts of Abu Dhabi's international financial centre ADGM.
In Abu Dhabi, the index (.ADI) fell 0.6%, hit by a 1.7% fall in its largest lender First Abu Dhabi Bank (FAB.AD).
Meanwhile, the United Arab Emirates said vaccinations against COVID-19 will be mandatory for people attending all "live events" from June 6, as the country pushes a vaccination campaign which has consistently been one of the fastest in the world. read more
The Qatari benchmark (.QSI) added 0.4%, supported by a 3.2% increase in petrochemical firm Industries Qatar (IQCD.QA).
Most major stock markets in the Gulf rose in early trade on Wednesday, supported by gains in their financial stocks, although Abu Dhabi bucked the trend to trade lower.
Saudi Arabia's benchmark index (.TASI) edged up 0.2%, helped by a 0.2% gain in Al Rajhi Bank (1120.SE) and a 0.3% increase in Saudi Basic Industries (2010.SE).
The value of Saudi Arabia's oil exports in March rose by 75% year on year to 52.3 billion riyals ($13.95 billion), official data showed on Wednesday. read more
Non-oil exports increased by 42.9% to 22.4 billion riyals, the General Authority for Statistics said.
Dubai's main share index (.DFMGI) added 0.3%, with its top lender Emirates NBD (ENBD.DU) gaining 1.2%, while sharia-compliant lender Dubai Islamic Bank (DISB.DU) was up 0.4%.
A judge in Abu Dhabi ruled in favour of Dubai Islamic Bank and against the administrators of NMC, in a case that could complicate the private healthcare firm's multi-billion-dollar debt restructuring. read more
NMC ran into trouble last year after the disclosure of more than $4 billion in hidden debt and its UAE operating businesses were placed into administration in the courts of Abu Dhabi's international financial centre ADGM.
In Abu Dhabi, the index (.ADI) fell 0.6%, hit by a 1.7% fall in its largest lender First Abu Dhabi Bank (FAB.AD).
Meanwhile, the United Arab Emirates said vaccinations against COVID-19 will be mandatory for people attending all "live events" from June 6, as the country pushes a vaccination campaign which has consistently been one of the fastest in the world. read more
The Qatari benchmark (.QSI) added 0.4%, supported by a 3.2% increase in petrochemical firm Industries Qatar (IQCD.QA).