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NBAD reports $345m exposure to Dubai World
National Bank of Abu Dhabi, the largest lender by market value in the UAE, on Monday said its exposure to two Dubai World affiliates amounts to $345m. The bank said it invested $114m in Nakheel's $3.52bn sukuk, which comes due December 14. It had $6m in the same December sukuk, held in NBAD's trading portfolio and marked to market. NBAD also said it had made general corporate loans amounting to $100m to Nakheel and $125m to Limitless. The two property developers are part of Dubai World which last week asked creditors for a six-month delay in repaying debt obligations. NBAD said it held no exposure to Dubai World Group itself, reported Reuters.
FGB refutes reports on Dubai World exposure
Abu Dhabi-based First Gulf Bank today refuted media reports on its exposures to Dubai World, saying the are 'completely unfounded'. In an e-mailed statement André Sayegh, Chief Executive Officer, First Gulf Bank, said, 'First Gulf Bank wishes to confirm that no senior executive released any statement related to FGB's exposure to Dubai World and some of its subsidiaries including Nakheel, and the recent reports are completely unfounded'.
HSBC says Dubai will overcome 'issues'
Michael Geoghegan, CEO of HSBC Holdings, has said that the bank is 'confident' Dubai and the UAE will overcome any short-term issues they face, Dow Jones has reported. 'Although our business on the ground in the Middle East represents only 2% of the group's balance sheet, it's an important and high-potential part of HSBC's international business mix and a region we are completely committed to,' he said. According to its half-year results report, HSBC had gross lending to the UAE of $16.3b as of June 30, including commercial, residential and personal lending.
UAE pledges bank support
The UAE Central Bank said it made emergency funds available to banks in the country to help avoid any liquidity shortage that might stem from the proposed restructuring of Dubai World. The 'Central Bank of the UAE ... stands behind UAE banks and branches of foreign banks operating in the UAE', it said in a statement. The facility would be linked to banks' current accounts at the central bank at the rate of 50 basis points above the three-month Emirates interbank offered rate (Eibor), the central bank said.
Saudi banks remain cautious on lending
The Saudi Arabian Monetary Agency has said the kingdom's bank credit growth was almost flat at SR722.6bn in October, up from SR721.6bn in September, as banks remained cautious about corporate indebtedness, Reuters has reported. Banks were awash with liquidity but unwilling to inject it into the economy of the major oil exporter, according to John Sfakianakis, chief economist at Banque Saudi Fransi in Riyadh.
GIB to delay dollar-denominated bond
Gulf International Bank, a Bahrain-based lender owned by the governments of six Arab states, has postponed a sale of five-year bonds after plans were announced by Dubai World to delay debt repayments, Bloomberg has reported. 'The decision was made in the best interest of investors participating in the deal, GIB told the news service. The lender has received 60 orders for the debt, with subscriptions almost double the intended issue size.
No change to UAE bank ratings, says Moody's
Moody's Investors Service has said the ratings or outlooks of banks in the UAE with exposure to Dubai World and Nakheel will remain unchanged for the moment, Reuters has reported. 'If the repercussions remain confined to exposures to Dubai World and Nakheel, and based on current assumptions and expectations, UAE banks are likely to be able to absorb potential stress at their current rating levels,' the agency said in a statement.
Qatar to call for GCC regional bank
Abdulrahman Al Attiyah, secretary-general of the Gulf Cooperation Council, has said that Qatar will propose that GCC countries create a regional development bank at next month's heads of state summit in Kuwait, Reuters has reported. The proposal is aimed at 'establishing a development bank for the GCC, similar to the European development bank, which will undoubtedly contribute to enhancing the GCC joint work', he said.
UK banks call for government action on Saudi firms
The British Bankers' Association has asked the UK government to express concern to the government of Saudi Arabia about money owed to international banks by two Saudi companies, Saad Group and Ahmad Hamad Algosaibi & Brothers Co, the Financial Times has reported, citing a letter to UK Trade Minister Mervyn Davies. Several banks have taken legal action in an effort to recoup money owed by the two companies, the total debt of which is estimated to be about $20bn, the newspaper said.
New start-up bill payment firm launches in Egypt
A new Egyptian start-up bill payment firm has announced it will launch operations in January, Reuters has reported. Fawry, Arabic for immediate, aims to ease hassle for consumers, billers and lenders by as intermediary, alerting a customer via email or text message when a bill is due and how much needs to be paid. The customer can then authorise Fawry to pay the bill, or access their own bank account to pay the bill online, over the phone, at a cash machine, or via Fawry's branded shops. The firm has signed up four banks - Credit Agricole and Bank of Alexandria along with state-owned Banque Misr and Banque du Caire - and expects agreements with National Bank of Egypt and Arab African International and another unnamed bank soon.
Deutshe Bank to become GFH shareholder
Gulf Finance House said Deutsche Bank has decided to convert part of an Islamic financing extended to the Bahrain-based investment bank into shares, Bloomberg has reported. Deutsche Bank will receive 78.95 million Gulf Finance House shares worth $30m. This sum is part of a $100m convertible Murabahah facility received from Deutsche Bank.
KFH-Turkey gets Islamic bank license in Dubai
Kuwait Finance House has announced that its Turkish unit has obtained a license to operate in the UAE. The Kuwait Turkish Participation Bank will operate in the Dubai International Financial Centre (DIFC) and will provide intermediary services for companies in the region with a focus on investment in Turkey, KFH has said in a statement.
UAE banks get four-day holiday for Eid
The UAE Central Bank has said that banks in the country will remain closed for four days from November 26 to 29 to mark Eid Al Adha. Banks will also get a two-day holiday on December 2 and 3 to celebrate the National Day, the central bank said in a statement.
Kuwaiti banks post $1.3bn profit
Kuwaiti banks posted net profits estimated at KD361m ($1.3bn) within the first nine months of 2009 despite the global economic conditions, KUNA has reported. National Bank of Kuwait came in the lead with a net profit of KD201.5m, followed by Kuwait Finance House with KD106.3m, Al-Ahli Bank of Kuwait which scored net profit at KD24.2m, Bank of Kuwait and the Middle East with KD15.1m, while Burgan Bank came fourth with KD13.5m.
Tamweel returns to profit in Q3
The UAE's largest provider of real estate finance, Tamweel has returned to black after recording losses for three consecutive quarters. The Shari'ah-compliant mortgage lender has posted a net profit of Dhs10m for the third quarter of 2009, after prudential impairment provisions of Dhs53m. Operational profit for the period before prudential impairment provisions amounted to Dhs63m. Cumulative net loss for the nine months period ended September 30, 2009 amounted to Dhs65m, compared to net profit of Dhs573m for the corresponding period in 2008.
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