Finance

Fitch removes Bahrain-based Mumtalakat from rating watch negative

Fitch Ratings has affirmed Bahrain Mumtalakat Holding Company's (Mumtalakat) Long-term Issuer Default Rating (IDR) and senior unsecured rating at 'BBB'. Fitch has also affirmed Mumtalakat's Short-term IDR at 'F3' and removed all the ratings from Rating Watch Negative (RWN). The Outlook on the Long-term IDR is Stable. The rating action also affects Mumtalakat's US$750 million 5% notes, due 30 June 2015, which have also been affirmed at 'BBB', Global Arab Network reports according to a press statement. The affirmation follows the agency's rating action on Bahrain's sovereign ratings. In line with Fitch's ""Parent and Subsidiary Rating Linkage"" methodology, Mumtalakat's ratings are aligned with the Kingdom of Bahrain's ('BBB'/Stable/'F3'), reflecting their strong relationship. Mumtalakat is 100%-owned by the government of Bahrain and is the government's investment arm. Source: Global Arab Network

Iraqi government to raise Industrial Bank's capital

The Iraqi government has decided to increase Industrial Bank of Iraq's capital to IRD150 billion allocated from the 2012 budget. The government has said that it will pump an extra IRD125 billion ($107 million) into its state-run Industrial Bank to bolster financing for the struggling private sector. Deputy prime minister for economic issues, Ross Nouri Shawis, has clarified that the rise of the bank's capital to IRD150 billion will be allocated from the 2012 budget. Source: Reuters

Kuwait: Fiscal education

Strong financial indicators in Kuwait have seen the country rewarded by a ratings upgrade. On July 20 Standard & Poor’s (S&P) announced that it was raising Kuwait’s long-term sovereign credit rating from AA- to AA, with a stable outlook. According to the credit rating agency, the economy’s strengths include high GDP per capita and healthy fiscal and external balance sheets, factors that have been accorded greater weight under S&P’s recently revised methodology for rating sovereign credit risk. S&P singled out Kuwait’s fiscal balance sheet for praise, saying that the country’s public finances remain exceptionally strong. For nearly a decade Kuwait has achieved budget surpluses that, when expressed as a percentage of GDP, are routinely double-digit figures. According to the IMF Article IV staff report for Kuwait released on August 1, the country’s fiscal surplus amounted to 28% and 21% of GDP in 2009 and 2010, respectively. Source: Oxford Business Group

Sukuk issuance worldwide tops $5bn in July

A specialized report has shown that the Sukuk (Islamic financial certificates) issuance worldwide mounted to $5 billion last July down from the previous month by 37%, where the Saudi riyal formed about 15% of those Sukuk. The report issued by the (Baitek Research Co) of the Kuwait Finance House has said that the sovereign Sukuk topped issuances in July, including three versions of Sukuk for Saudi and Qatari companies. Source: Kuwait News Agency

Standard Charter acquires stake in Saudi Binladin unit for $75m

Standard Chartered's private equity arm has acquired a minority stake in a Saudi Binladin Group unit for $75 million. The regional private equity head of Construction Products Holding (CPC) has said that the company is eyeing more deals in Saudi Arabia after fulfilling the deal. The investment in Construction Products Holding Co (CPC), the lender's first private equity deal in the Saudi market, will give it a board seat on CPC, the kingdom's largest manufacturer and provider of building materials. Source: Reuters

Abu Dhabi Islamic Bank gets approval for Qatar branch

Qatar Financial Centre Regulatory Authority (QFCRA) has granted Abu Dhabi Islamic Bank the necessary approval to open an Islamic branch in country. The move comes six months after a central bank verdict asked conventional lenders to stop operating Islamic branches in the country. The authorization will allow the bank to carry on regulated activities in relation to deposit taking, providing and arranging financing facilities and managing investments, the regulator said. Source: AMEInfo

New megabank likely to be based in Bahrain

Adnan Ahmed Yousif, chief executive of Al Baraka Bank has said discussions are still on about whether a long-touted $3 billion Islamic megabank is to be based in Bahrain or Qatar although a final decision has not yet been made. ""While the location of the bank is still under discussion, in all probability it will be based in Bahrain,"" he said. The proposed entity will be named Istikhlaf Bank and will be incorporated with an authorized capital of $10 billion and paid up capital of $3 billion, Yousif said. Source: Reuters