Finance

Dubai fund may sell Barneys New York

Barneys New York Inc's owner, Dubai's Istithmar World PJSC, may sell the US luxury retailer less than two years after buying it as the fund struggles with losses and the luxury market slows, a source reported, citing two people familiar with the situation. Istithmar doesn't want to sell the business for less than the US$942.3 million it paid in 2007, said a source. The state-owned fund has had calls from potential buyers and would sell its entire stake.

Moody's: Sukuk issuance slowdown mainly due to credit crisis, but Shari'ah compliance also an issue

The Islamic finance industry, particularly the Sukuk market, faced unprecedented challenges in 2008. Namely, the ongoing global credit crisis, rising cost of borrowing, lack of investor commitment to capital market securities as well as debates over the Shari'ah compliance of some Sukuk structures, says Moody's Investors Service. "By the end of 2008, global Sukuk issuance had declined by more than 50 per cent," says Faisal Hijazi, Moody's Business Development Manager for Islamic Finance and author of the report. "Globally, credit markets underwent a significant decline in debt market issuance, mainly driven by the lack of global economic visibility, pricing and a lack of committed investors. The Gulf Cooperation Council (GCC) and Malaysia were hardest hit, with Sukuk issuance declining by 55 per cent and 59 per cent, respectively." he added.

Malaysia, Qatar to set up US$1 billion investment fund

Malaysia and Qatar have agreed in principle to set up a US$1 billion investment fund for mutual investment, Foreign Minister Datuk Seri Dr Rais Yatim said. He said details of the fund will be finalised at a meeting between Prime Minister Datuk Seri Abdullah Ahmad Badawi and his Qatari counterpart Shaykh Hamad bin Jasim bin Jabir Al-Thani. Among matters to be fine-tuned are the type of projects and where the projects are to be implemented, he told Malaysian journalists covering Abdullah's two-day visit to Qatar.

India's Financial Tech to launch new bourse in Bahrain

India's Financial Technologies Ltd will launch a new bourse in Bahrain that will provide a secondary market for Islamic bonds, a company executive said. The new exchange, called Bahrain Financial Exchange, has been licensed by the Gulf state's central bank and plans to start operations in the first quarter of next year, Financial Technologies' director Arshad Khan said. Unlike conventional bonds, the Islamic bond market, or sukuk, lacks a strong secondary market and most buyers hold the asset to maturity.

Bank of London and the Middle East launches Sharia’a compliant private banking business

Bank of London and The Middle East plc (“BLME”), the UK Sharia’a compliant wholesale bank, has confirmed that it will be extending its Wealth Management division with the launch of a fully Sharia’a compliant private banking business. BLME Private Banking will provide Islamic finance solutions to assist high net-worth individuals, entrepreneurs and their corporations in the UK, Europe and Middle East with their banking and investment management requirements.

Oman releases details of new special economic zone

Oman has released details of a new special economic zone (SEZ) that is being set up in partnership with strategic international investors including an Indian infrastructure development firm. The Sohar Special Economic Zone, a joint venture between the Oman government's Sohar International Development Company, India's SKIL Infrastructure and the Netherlands' Port of Rotterdam, would come up in four phases across a 4,500-hectare area near the port of Sohar, 240 km northwest of the Omani capital of Muscat.

First Gulf to open branch in Qatar Financial Centre

First Gulf Bank (FGB) said it has been authorised by the Qatar Financial Centre Regulatory Authority to operate in the Qatar Financial Centre. The creation of the new branch furthers FGB's global expansion and revenue diversification strategy. Andre Sayegh, FGB's CEO, said, "Qatar's economy is experiencing rapid growth across all sectors and we are delighted to be able to play a role and participate in this growth."

Middle East backers 'will pay what it takes' to block Barclays bailout

Middle East investors will plough in as much money as necessary to maintain their near-32 per cent controlling stake in Barclays if the bank does a U-turn and seeks a government bailout. City sources say the sovereign wealth funds and royal families of Qatar and Abu Dhabi are determined not to be diluted by any government "rescue" of the British bank.

S & P Fund Services: MENA fund managers optimistic for medium and long term

In its annual review of funds in the Middle East and North Africa, Standard & Poor’s Fund Services found considerable optimism for the medium to long term among fund managers. However, most expected downward pressure on markets to continue in the short term, as the bad news needs to be further incorporated into prices. “The region’s much vaunted low correlation with the rest of the world’s markets failed to materialise and all the major Middle Eastern markets fell significantly in recent months,” said S&P Fund Services lead analyst Roberto Demartini, highlighting Dubai and Egypt, where local exchanges were down more than 50 per cent in 2008 to October. “The downward pressure largely came from international investors looking to exit what are, for them, off-benchmark positions,” he said.

Saudi Arabia: Solid position

Saudi Arabia's banking sector has thus far avoided the losses that have plagued banks in the US and Europe, with relatively limited exposure to the global crisis and no instance of a bailout. On January 19, the Saudi Arabian Monetary Agency (SAMA - the Kingdom's central bank) made further interest rate cuts in a bid to ensure the flow of cash in the market. "Domestic money market rates have positively responded to monetary stimulus and the recent global easing in inter-bank rates," SAMA said in a statement.