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Union Bank of India to open Dubai b...
M.V. Nair, chairman and managing director of Union Bank of India, has announced plans to open a branch in Dubai to meet the funding needs of Indian corporates in the Middle East, Khaleej Times has reported. UBI already has a representative office in Abu Dhabi since 2007, but the forthcoming branch in the Dubai International Financial Centre (DIFC) will mainly focus on foreign currency funding and trade finance requirements of non-resident Indians in the region, he said. "In [the] DIFC, we are permitted to do wholesale business and here [Dubai] the purpose would be... supporting the UAE and India trade that will be major focus," Nair told the daily.
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Xpress Money teams up with Thai bank
Abu Dhabi-based Xpress Money has announced commencement of instant money transfers to Thailand-based Government Savings Bank, the Gulf Today has reported. The announcement follows an agreement between the two brands marking Xpress Money's extended reach to all 76 provinces of Thailand.
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Emirates NBD expands services in Saudi
Emirates NBD has become the first UAE-based bank and the only non-Saudi bank to offer customers in the kingdom electronic bill payment facilities for utilities and government services. The provision of the utility bill payment facility is mandatory for all banks operating in Saudi Arabia, but the inclusion of government services has only been adopted by major lenders, the bank said.
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Carnegie buys troubled Swedish bank
Stockholm: Swedish bank Carnegie said yesterday it was buying HQ Bank, which was closed by authorities last weekend for breaking risk rules, for 268 million crowns ($37 million) in a deal cleared by the financial watchdog.
HQ Bank, owned by holding company HQ, was put into liquidation on Monday after the Swedish Financial Supervisory Authority revoked its banking licence for grossly breaching financial regulations.
The FSA said investment bank Carnegie's purchase of HQ Bank meant the unit could resume banking operations while the merger was being finalised.
Carnegie said the deal included an additional agreement to buy the funds arm of the bank, HQ Fonder, for 850 million crowns in covertible debentures and preferred Carnegie stock.
"The combined company is financially strong," Carnegie said, adding: "With the acquisition of HQ Bank and HQ Fonder, Carnegie creates the clearly leading independent investment bank in the Nordic region".
Carnegie said HQ Bank would be merged with Carnegie while HQ Fonder, currently owned by HQ part-owner Oresund, would become a subsidiary of the bank. The FSA pulled HQ Bank's licence after finding a lack of oversight in its trading operation, saying the bank had taken such large risks it endangered its own survival. The prosecutor's office has opened a separate investigation.
It was the second time in two years Sweden acted forcibly against a financial group. In 2008, the FSA withdrew the licence for Carnegie itself, which was then taken over by the state and sold in 2009 to investment company Bure and private equity firm Altor.
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Gulf banks' loan losses and impairm...
Standard and Poor's Ratings Services has warned of future challenges facing the Gulf lenders it rates, but said they appear to be showing signs of improvement, after spending more than $20bn on loan loss provisions and investment impairments since 2008. "We believe the asset quality of Gulf banks should improve from 2011 and that their good margins and efficiency will provide a solid foundation for their return to high profitability," S&P's credit analyst Mohamed Damak said. However, improving liquidity, funding future growth, and refinancing the stock of existing debt are the next hurdles facing Gulf banks, the rating agency said.
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QNB and Bank Kesawan ink letter of ...
Qatar National Bank has said it could become the controlling shareholder of PT Bank Kesawan after a planned rights offering by the Indonesian lender. The banks signed a "letter of intent" which makes the Qatari lender the "standby buyer" for the offer, Doha-based QNB said in a statement. The offer is expected to close in the first quarter of 2011.
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Oman's Bank Sohar gets CBO approval...
Oman's Bank Sohar has received the Sultanate's central bank's approval to issue subordinated loans up to OR50m ($129m) on a privately placed basis, Oman Daily Observer has reported. The issue will carry a maturity of up to seven years. The issuance process has already been initiated by the bank and is expected to be completed shortly, the lender said.
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Egypt's Barclays enjoys 38% rise in...
Barclays Bank Egypt has said its first-half net profits rose 38% to EGP175m ($30.6m), compared to EGP126m during the same period last year, Daily News Egypt has reported. Expenses dropped 10% year-on-year, while credit losses improved from EGP74m in 2009 to EGP24m this year. The bank currently has 65 branches.
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Moody's: NBK's ratings capture its ...
The credit rating agency Moody's has released its latest credit analysis report for the National Bank of Kuwait.
Moody's report highlighted that NBK's ratings reflect "dominant position in domestic commercial banking" and captures "the strength and depth of NBK's management team, its clear strategy, and strong financial metrics, particularly the resilience of its asset quality and strong profitability despite the weakening operating environment".
Moody's in the report issued yesterday said that NBK's "reported asset-quality figures for the year proved exceptionally resilient" where "NPLs to gross loans actually declined to a market best of 1.76%". According to Moody's, "NBK appears to have avoided high-profile regional and domestic corporate defaults. This reflects well on its credit vetting systems and processes, which have so far proven adequate to safeguard asset quality".
Moody's added that "NBK is Kuwait's largest bank with its market shares in assets and loans reaching around 30%" and that "NBK's franchise is strong and its dominant position is not being challenged by domestic commercial banks". NBK is "one of the few indigenous banks in the region with the capacity to structure and underwrite large capital-market transactions".
Moreover, according to Moody's, NBK "benefits from strong brand-name recognition and an excellent reputation, particularly in its domestic market, and should benefit from a flight to quality in the event of market tensions".
Finally, Moody's pointed out that "NBK was the only Kuwaiti bank that was able to post an increase in net income during 2009" and that "compared with its domestic peers, the depth and diversity of its business lines enhance NBK's revenue diversification". Moreover, "NBK has been pursuing a regional expansion strategy in recent years that may, over the medium-to-long term, provide it with the growth opportunities lacking in its domestic market".
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DIFC aims to reduce cost of operati...
Dubai: Dubai International Financial Centre (DIFC) is working on a plan to reduce the cost of operations, including rents and fees, for firms operating from the financial free zone, a top official said on Tuesday.
"We are working on a plan to reduce the cost of operations for all firms operating from the DIFC. It will be in the interest of all. We are in discussions with all stakeholders and will have a clear picture of these new initiatives in the next three to four weeks," Abdullah Al Awar, chief executive of the DIFC Authority told Gulf News on Tuesday.
The DIFC announced that it's strategy for the next phase of growth will focus on the Middle East, Africa and South Asia (Measa) regions.
"Since its inception in 2004, the DIFC has grown to become one of the world's top international financial centres connecting the Menasa [Middle East North Africa and South Asia] region and the world. Today, the DIFC with its modern infrastructure, free-zone status and self-governing laws and courts, is globally recognised as the pre-eminent financial centre in the region," said Ahmad Humaid Al Tayer, Governor of the DIFC.
The DIFC, which was set up in 2004, now comprises 745 active registered companies — 297 regulated companies, 374 non-regulated companies and 74 retailers.
"Despite the global economic challenges, the DIFC continues to grow steadily as one of the world's established financial centres. Currently, 16 of the world's top 20 banks have established a presence at the DIFC. Meanwhile, eight of the world's largest asset managers and four of the world's five largest insurers are also based at the DIFC," the financial centre said in a statement.
Diversified mix
DIFC has a wide global mix of firms, with approximately 40 per cent of the regulated firms coming from different parts of Measa, 42 per cent from Europe and 18 per cent from the US and rest of the world. DIFC officials said yesterday that over the past year there have been significant increase in the number of firms from Asia setting up businesses here.
"We are seeing a surge in the number of top-class firms from China, Malaysia and India opening their businesses in the DIFC. Going forward we expect the pace to pick up over the course of the next few months and the trend is evident from the strong pipeline of companies applying for licences," Al Awar said.
During the first six months of 2010, the number of companies registered in the DIFC remained constant despite the economic downturn.
While a small number of firms have withdrawn from the DIFC, a significant number of firms from across the world have continued to set up businesses there — including first-time entrants into the region. Occupancy of the DIFC's Gate District — Gate Building, Gate Precinct and Gate Village — remains high at 92 per cent of the leasable space.
"While the DIFC continues to evolve, we have achieved a very encouraging performance so far this year, especially in light of the global economic backdrop of the last two years," Al Tayer said.
The DIFC continues to build on its internationally recognised regulatory framework and legal system in order to support the growth of financial services and commercial activities.
In July, the Dubai Financial Services Authority introduced a series of regulatory changes to the DIFC's Collective Investment Funds regime in order to make the DIFC a more attractive investment centre for both foreign and domestic fund managers.
As part of its efforts are aimed at fostering international cooperation and dialogue between parties, the DIFC Authority has signed six memoranda of understating with various jurisdictions, including the UAE Central Bank, Dubai Department of Economic Development, Hong Kong Monetary Authority, World Bank Group's Multilateral Investment Guarantee Agency, Paris Europlace and, recently, Luxembourg.
"We are now embarking on a new phase of growth and continue to act as a gateway between the Measa region and the world's capital markets. Our focus is to expand and grow our existing client partnerships," Al Awar said.
