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Gap between loans and deposits narrows
The funding gap between total loans and deposits at UAE banks narrowed to Dhs45.9bn in July, down 3% from the previous month, as bankers lost much of their appetite for lending during the recession. Total loans and advances by UAE banks declined by 0.2% in July to Dhs1.01trillion compared with corresponding figures for June. Bank deposits rose by 0.2% to Dhs964.1bn over the same period, the Central Bank data showed. (Mac Capital Advisors)
High provisions push up FGB's profits in long run
High loan loss provisions will stifle growth in the net profits of the Abu Dhabi-based First Gulf Bank (FGB) in the short term, but they are expected to nearly double in four years, according to Global Investment House. GIH has projected the net income of the UAE's fourth largest bank to climb by about 5.6% to almost Dhs3.17bn in 2009 and by nearly 19.8% to Dhs3.79bn in 2010, from about Dhs3bn in 2008. (Mac capital Advisors)
DFSA reluctant to raise bank capital requirements
Dubai Financial Services Authority (DFSA) is reluctant to raise banks' capital holding requirements to prevent another economic collapse, Emirates Business 24/7 has reported. Capital level must be determined before looking into increasing the requirements, DFSA's Chief Executive Paul Koster said. "We cannot even make all agree on what should be in the balance sheet and what should be potentially off the balance sheet. And capital requirements are related on what's on the balance sheet and how you valuate it," Koster said.
IIB reports net H1 loss
Bahrain-based International Investment Bank has reported a net loss of $1.4m for the first half of 2009, compared to a net profit of $11.3m for the same period last year. Total H1 income was $3.8m, while Capital Adequacy Ratio was 66%, IIB said. The bank said the loss was down to a reduction in investment banking transactions and lower profit rates applicable to bank placements, because the bank has slowed down its investment activities, due to the current market situation.
Bank AlBilad teller roll-out targets fraud detection
Saudi Arabia-based Bank AlBilad has completed the installation of the Magner75 Plus teller currency counting machines across all its AlBilad and Enjaz branches. The new machines allow accurate and high-speed currency counting and can detect counterfeit notes, the bank said, helping its efforts to combat fraud.
NBK offers 0% loans
National Bank of Kuwait (NBK) has launched a 0% interest Ramadan offer for its credit cards and car and retail loans. The offer is valid until late November, and available to both new and existing customers. Existing credit card holders can nominate one purchase, with a value up to KD1,000 ($3,485), for a 0% interest repayment for six months. New customers will get 0% on all purchases for three months.
Mashreq to open 16 Abu Dhabi branches
Mashreq Bank is opening 16 branches in Abu Dhabi and Al Ain. It brings the number of branches run by the Dubai-based bank to 46 in the UAE. The bank also plans to add a further 10 ATM cash withdrawal machines.
Saudi Algosaibi to sue Mashreq Bank
Saudi-based Ahmad Hamad Algosaibi and Bros (AHAB) intends to sue Dubai-based Mashreq Bank in a New York court, for being "wilfully blind" to irregular deals that helped lead Algosaibi into default, Reuters reports. The decision to take legal action follows Mashreq's $150m suit filed earlier this year against Algosaibi. AHAB's legal counsel Eric Lewis claims Mashreq made $12m in profit through irregular short-term loans that were rolled over continuously, as a means of financing the Money Exchange currency trading house owned by Saad Group. In a statement, Mashreq said: 'The charges are completely without merit, outrageous in the extreme and really nothing more than an attempt by Algosaibi to divert attention away from their own responsibility."
Moody's downgrades HSBC Middle East
Moody's Investors Service has downgraded the bank financial strength rating of HSBC Middle East to C from C+ and its long-term local currency debt rating and foreign currency deposit and debt ratings to Aa3 from Aa2. The rating outlook is now stable. Moody's has downgraded HSBC Middle East as it believes the bank will come under pressure on its asset quality and profitability in the countries in which it operates, particularly the UAE, which makes up around 70% of its operations.
GFH signs partnership with Macquarie
Bahrain-based Islamic investment bank Gulf Finance House (GFH) is setting up a joint Islamic financial services platform in the Middle East with Macquarie Group, a provider of banking, financial, advisory, investment and funds management services. The partnership is subject to board and regulatory approvals, but if given the green light will include a joint presence in the region and a $100m convertible Murabaha investment by Macquarie in GFH, as part of GFH's current capital management initiatives.
Emirates NBD appoints CIO for private banking
Emirates NBD announced the appointment of Gary Dugan, a UK financial industry expert, as the new Chief Investment Officer for its Private Banking division. As CIO, Gary will be in charge of the overall investment policy of the Private Banking and will lead a core team that will provide strategic and tactical asset allocation advice to Private Banking clients for investments across several asset classes. He will also be responsible for establishing economic and market views of Emirates NBD Private Banking. (Mac Capital Advisors)
NBAD to meet with investors
National Bank of Abu Dhabi (NBAD) has hired several banks to arrange meetings with fixed-income investors in Europe, Asia and the UAE during the first week of September. The Abu-Dhabi based bank said it recently updated its Euro Medium Term Note program and that it will be holding several meetings, "targeting fixed income investors in Europe, the UAE and Asia." The banks hired to arrange the meetings are Barclays, BNP Paribas, NBAD and The Royal Bank of Scotland. (Mac Capital Advisors)
First Energy Bank posts H1 profit
Bahrain-based First Energy Bank (FEB), an Islamic investment bank focused on the energy sector, has reported profits of $5.6m for the first half of 2009. Gross income was $16.6m, which included $9.4m earned on short- and long-term treasury transactions, $5.8m on advisory services provided to local banks and $1.4m earned on available-for-sale Sukuk investments, FEB said. Vahan Zanoyan, CEO, said: "It is important to realise that this is the first full year of operations for FEB, and that we are still building the bank in terms of our investment portfolio, capabilities and our operations."
UAB keeps strong credit ratings
The international credit rating agency, Capital Intelligence has left United Arab Bank's (UAB) foreign currency ratings unchanged at BBB+ long-term and A2 short-term. The long-term rating indicates good credit quality with a satisfactory ability to fulfilment its financial obligations in a timely fashion, while the A2 rating indicates a strong capacity for timely repayment over the short-term, the rating agency said. UAB posted an H109 net profit of Dhs134m for the period ending June 30, up 11% on the same period last year.
Dubai Silicon Oasis signs loan with ADCB
Abu Dhabi Commercial Bank (ADCB) has approved the Shariah compliant Mudaraba Medium Term Facility worth Dhs300m for Dubai Silicon Oasis (DSO), WAM has reported. The funds will be used by Dubai Silicon Oasis Authority (DSOA) to part finance the development of facilities within the technology park.
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