GCC

UAE Cabinet appoints Steering Committee to Review, Develop Strategies for Amlak, Tamweel

UAE Cabinet appoints Steering Committee to Review, Develop Strategies for Amlak, Tamweel. The high-level Committee, headed by H.E. Sultan bin Saeed Al Mansouri, UAE Minister of Economy, brings together experts from across ministries and regulatory bodies. The move highlights the federal government's support to the UAE economy and strengthening of its financial institutions. The Committee will draw up a comprehensive report of Amlak's and Tamweel's performances under the changed economic environment and present its recommendations on the way forward to the government by the end of February.

Central Bank of Bahrain issues Legal and General two licenses

The Central Bank of Bahrain has granted licenses to Legal and General Gulf and Legal and General Gulf Takaful. The two companies will be established with total paid up capital of BD 10 mn which will be contributed equally by British Insurer Legal & General Group Plc. (LGEN.L) and Ahli United Bank B.S.C. (AUBB.BH).

Saudi Credit Bureau (SIMAH) and Standard & Poor's launched National Data Pooling Project (NDPP)

Joint Press Release

Riyadh ? London, February 2 2009

Saudi Credit Bureau (SIMAH) and Standard & Poor's, the leading provider of financial market intelligence, independent ratings, indices, investment research and data across the Middle East?s credit risks launched today the National Data Pooling Project (NDPP) and signed a contract in Riyadh. SIMAH was represented by its General Manager Mr. Nabil Abdullah Al-Mubarak, Standard & Poor?s by Mr. David Pearce, Managing Director of McGraw-Hill International (UK) Ltd and Mr. Bernard O?Sullivan, Managing Director and Head of Standard & Poor?s Risk Solutions in Europe, Middle East & Africa.

In this context, Nabil Al-Mubarak stated that the project comes as the final step in the framework of specialized projects for measuring credit risks, which would enable all participating member banks to fulfill all requirements of Basel II capital adequacy issued in 2005, referring to the fact that the Kingdom has already been implementing Basel II Capital Standards since 2006, and welcoming at the same time the strategic relationship with Standard & Poor's.

Global, Investment Dar cut salaries

Global Investment House laid off around 40 employees, and reduced salaries by up to 20 %. Investment Dar has cut salaries by 5 to 20 % but said it had no plans to lay off staff.

Moody`s may downgrade Dubai companies and related Sukuk

Moody's may downgrade its debt and Sukuk ratings of six Dubai companies, including DP World and Emaar Properties by as much as two notches each following a review in the coming weeks.

In addition to Emaar and DP World, Moody's said it was reviewing ratings of DIFC Investments, Dubai Holding Commercial Operations Group, Dubai Electricity and Water Authority (DEWA) and the Jebel Ali Free Zone (JAFZA).

Gulf Finance House and others to develop resort in Morocco

Morocco has signed a letter of intent with Itmar developpement, Abou Dhabi Investment and Gulf Finance house to develop a USD 1.8 bn, 270 hectar large resort in Essaouria, Morocco at Davos.

Ajman Bank officially launched

Ajman Bank is officially launched as the Emirate of Ajman`s first Islamic commercial bank. The bank will serve the community and emphasize social corporate responsibility.

Yousif Khalaf is the CEO of Ajman Bank.

Emirates NBD launches Sukuk fund

Emirates NBD has launched a fund to take advantage of the high yields currently available in Sukuk following the steep price declines in Q4 2008 caused by the wider turmoil in global financial markets. The Shari’a-compliant Fund targets annualized returns of c.12% over the next four years.

Jamal Bin Ghalaita, General Manager of Consumer Banking and Wealth Management at Emirates NBD, sees Sukuk as undervalued after panic selling last year.

Minimum investment of USD 25,000 for individual investors and USD 1,000,000 for institutional investors. The secondary sukuk market is difficult to access but, by investing through the Fund, investors benefit from scale, diversification, and the skills of expert fund managers. Should the Fund meet certain return targets, the Fund will be called and gains will be locked in for investors.

BNP Paribas Investment Partners launches Sukuk Fund

BNP Paribas Investment Partners currently manages about half a billion USD in Sharia compliant assets and targets according to the chief executive MENA Tariq Al Samahiji to multiply this amount. The bank currently offers equity Sharia management and has recently started marketing its first Islamic bond or sukuk fund.
Al Samahiji expected the sukuk fund to attract investments from institutions and wealthy individuals, but stressed BNP would not market the fund to the retail market.

Kuwait Finance House’s 2008 posts profit before provision and increase income

Edward Russell reported on Financeasia on 2 February, that Kuwait Finance House’s (KFH) 2008 posts profit before charges but faces falling revenues. In Q4, KFH's revenue fell 16.3 % quarter-on-quarter to KD 185 mn. The revenue decline increased 3.7 % from the previous quarter when it fell 12.5 % quarter-on-quarter. Despite the decline in revenues in the second half of the year, the bank managed to report an overall increase in income of 6.5 % year-on-year.

The finance house's unaudited full-year net profit totalled KD 157 mn(USD 542 mn on revenues of KD 884.9 mn. Given the current economic environment, KFH announced to retain KD 211 mn as a "provision". After the KD 211 mn provision, KFH lost anywhere between KD4 8 mn and KD54 mn for the year. Full-year and fourth-quarter audited results have yet to be released.

Darakhim Sukuk Basket presented in Kazakhstan

Caspionet reported on 28 January, that Darakhim Sukuk Basket have been presented in Kazakhstan. It is expected that insurance companies, unit investment funds and pension funds will become the chief buyers of the new investment offer. Basically, they represent the companies of the Middle Eastern states, so they are issues of the central bank of Bahrain, the government of the Arab emirates, Kuwait and Saudi Arabia. It is expected that the profitability will amount to 10 % at a minimum with a circulation period of 3 years.

Tamweel restructuring including layoffs

Suzanne Fenton reported on 29 January on Gulf News, that Dubai-basedm mortgage lender, Tamweel PJSC - a company which is currently under merger process with Amlak - is restructuring its business plans and organisational structure that involves a reduction of 57 staff members from its workforce. Tamweel, Amlak, Real Estate Bank and Industrial Bank are about to merge to UAE`s largest mortgage provider. Emirates Development Bank will have access to government funds.

Gulf Finance House targets undervalued assets in the region

Frederik Richter reported on Arabianbusiness on 1 February that Gulf Finance House is looking for acquisitions of undervalued assets in the region.

Deputy Chief Executive Mehran Jamsheer was cited.

Millennium Finance Corporation (MFC) on expansion course

Waheed Abbas from Emirates 24/7 reported on 2 February about the regional investment bank and private equity company Millennium Finance Corporation (MFC), which aims to expands its reach to Saudi Arabia, India and Nigeria through joint ventures and acquiring licences. The firm is also considering IPO.

CEO is Keba Keinde, which gave an exclusive interview with Emirates Business. Please click on the source below.

Dubai Islamic Bank partners with Hawkamah Institute

Rebecca Bundhun reported on Arabianbusiness on 29 January that Dubai Islamic Bank partners with Hawkamah Institute has signed a "founding member" sponsorship agreement with corporate governance organisation the Hawkamah Institute.

SCOTTISH Widows Investment Partnership enters Saudi market

The Scotsman reported on 29 January that SCOTTISH Widows Investment Partnership has launched a joint venture with Manar Financial Investment Company; Swip Saudi Asset Management. It will mainly focus on investment in the insurance sector, but will also manage shariah-compliant global emerging market equities.

Gulf Finance House reports quarterly loss and 14 % lower annual profits

Bahrain's Gulf Finance House has reported a Q4 loss of USD 10 mn after it made 'provisions on investments' compared with net income of USD 108.8 mn for the same period. Total year earnings are down to USD 291 mn (Dh 107 mn) in 2008 compared to USD 340 mn in 2007.

Shortfalls and Overbanking in the GCC

Rohit Chawdhry, portfolio manager of Bahrain Islamic Bank, analyses the issue of overbanking in the Gulf region and the institutions anticipating mergers in the February issue of The Middle East. He concludes that all state plans fostering project developments are not covered by a sufficiently large banking sector. The Institute of International Finance estimates there are about USD 1.9 trillion worth of projects under way in the region, making the GCC one of the largest project finance markets in the world. But analysts estimate that the present project finance, which includes bank lending, bond and equity issuance, has a funding shortfall of at least $900bn, if not more. To create banks which are able to shoulder a greater proportion of the financing needs of projects under construction, by state and private investors is the challenge of the policy makers.

S&P: Shamil Bank of Bahrain 'BBB-/A-3' Ratings Withdrawn At Bank's Request

Press Release

PARIS (Standard & Poor's) Jan. 28, 2009--Standard & Poor's Ratings Services said today that it affirmed its 'BBB-/A-3' ratings on Shamil Bank of Bahrain. The outlook on the ratings remains negative. The ratings were subsequently withdrawn at the bank's request.

As a result of the withdrawal, Shamil will no longer be subject to Standard & Poor's review. At the moment of the ratings withdrawal, the bank had no rated debt outstanding.

S&P: Arcapita Bank B.S.C. Downgraded To 'BB+/B'; 'BB+' Placed On CreditWatch Negative

Press Release

PARIS (Standard & Poor's) Jan. 28, 2009--Standard & Poor's Ratings Services said today that it has lowered its long- and short-term counterparty credit ratings on Bahrain-based Arcapita Bank B.S.C. to 'BB+/B' from 'BBB/A-2' and placed the long-term rating on CreditWatch with negative implications.

"The downgrade and CreditWatch placement reflect our opinion of Arcapita's weak liquidity profile amid an increasingly difficult operating environment," said Standard & Poor's credit analyst Mohamed Damak.

At the same time, we believe that the value of Arcapita's own investments--mainly in private equity and real estate--could decline in value given current market conditions (like other private equity firms). We view Arcapita's leverage as high. We understand that Arcapita made certain investments in 2008 that it was not able to fully place with customers that triggered a decline in liquidity and an increase in investment leverage (as measured by the ratio of total investments to total equity).

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