IMF projects MENA region’s GDP to grow 2.7 percent in 2024

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In its most recent regional economic outlook, the International Monetary Fund (IMF) expects the Middle East and North Africa (MENA) region’s gross domestic product (GDP) to grow moderately by 2.7 percent in 2024 from 1.9 percent in 2023. In 2025, the IMF expects growth to strengthen by 4.2 percent as the impact of temporary factors such as regional conflicts fade.

Fitch Rates Bank Albilad ‘A-‘; Stable Outlook

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BAB’s Long-Term Issuer Default Ratings (IDRs) are driven by potential support from the Saudi Arabian authorities, as reflected by its Government Support Rating (GSR) of ‘a-‘. BAB’s GSR is in line with that of other Fitch-rated Saudi banks, reflecting Fitch’s view on the Saudi authorities’ strong ability and willingness to support domestic banks.

Egypt’s GDP to climb to 5.1 percent by 2025: OECD

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According to the latest report by the Organisation for Economic Co-operation and Development (OECD), Egypt’s GDP is set to grow to 5.1 percent by the fiscal year 2025-2026. The report suggests the growth will be driven by growing consumption if inflation declines and fiscal support gradually withdraws.

OQ mulls IPOs of two units this year

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Following the successful completion of two initial public offerings (IPOs) of its subsidiaries Abraj Energy Service Company and OQ Gas Networks in 2023, Oman’s globally integrated energy group, OQ, is considering IPOs of two more subsidiary companies this year, according to a Bloomberg report.

GCC outlook more upbeat than global prospects

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The outlook for the GCC region in 2024 is more optimistic in comparison to the rest of the world, supported by the reversal of oil production cuts, still strong international oil prices and growth in the non-oil economy, analysts at a global professional services network said.

Saudi Exchange launches TASI50 Index

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The Saudi Exchange has announced the launch of the TASI50 Index, which tracks the top 50 companies listed on the Saudi Exchange by total market capitalization. The index is calculated in real time and tracks the stocks of the largest companies in the market.

The Gulf Capital Market Association summit 2023 paves the way for sustainable finance in the region

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Dubai – The Gulf Capital Market Association (GCMA) successfully concluded its 2023 Summit, “The Path to a Sustainable Capital Market,” held as part of the COP28 Climate Action Innovation Zone. The event brought together global industry leaders, investors and market participants to discuss the critical role of the region’s financial markets in the global transition to sustainability.

Dude, where’s my greenium?

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Two sovereign issuers recently complained that the pricing advantage of doing a green bond rather that a conventional one – the fabled greenium – was not enough to justify the extra costs associated with labelled issuance.

ESG investing projected to reach $53trln by 2025

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With the UAE hosting the pivotal COP28, the intersection of climate policy and market strategy is more prominent than ever. Discerning traders are positioning themselves to take advantage of specialized financial products that are both climate-forward and financially astute, including the Green Index, the ESG Index, the EV Index, and the EUA Futures CFDs.

CMA: 300% Increase in foreign investors ownership value in the Saudi Capital Market during the last 5 years

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Riyadh: The value of foreign investments in the Saudi capital market has increased by 300% over the past five years, specifically from 2018 to the end of 2022, reaching SAR 347.01 billion by the end of the period. This constitutes 14.2% of the total value of the free float in the main market, compared to SAR 86.86 billion in 2018, which represents 3.77% of the total value of free float shares in the main market for that year.

CMA publishes a public consultation for regulating foreign investors’ ownership

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Saudi Capital Market Authority (“CMA”) called upon relevant and interested persons participating in the capital market to share their feedback on the Exclusion of Companies Listed in the Saudi Stock Exchange (Tadawul) from the Meaning of the Phrase (Non-Saudi) in accordance with the Law of Real Estate Ownership and Investment by Non-Saudis for a period of fifteen (15) days ending on 15/05/1445 AH, corresponding to 29/11/2023.

Fitch Affirms Public Investment Fund at ‘A+’; Outlook Stable

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Fitch Ratings has affirmed Public Investment Fund’s (PIF) Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDR) at ‘A+’ with Stable Outlook. Fitch has also affirmed PIF’s special-purpose vehicle (SPV) GACI First Investment Company’s guaranteed EMTN programme ratings and senior unsecured long-term ratings of US dollar-denominated bonds at ‘A+’.

Strong Q3 results set scene for further profitable growth

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Insurers in Saudi Arabia (A1 positive) have delivered strong performance for the first nine months of 2023, reversing the weak performance of recent years. The sector is benefiting from the continued expansion of compulsory medical and motor insurance, stronger investment returns thanks to rising interest rates, and significant price rises following a rise in claims in 2021 and 2022.

Boursa Kuwait organizes awareness session on sustainable finance in commemoration of World Investor Week

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In its continuous efforts to raise financial awareness in the investment community and shed light on the latest developments and trends in the international investment community to participants in the Kuwaiti capital market, Boursa Kuwait organized a series of sessions and workshops during the month of October, the latest of which was a collaboration with the Certified Financial Analysts Society (CFA) and its chapters in Kuwait and Bahrain on sustainable finance, held on Wednesday, October 18, 2023.

Oman’s OQ Gas Networks expected to price IPO at top of range

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Oman’s OQ Gas Networks (OQGN), the pipeline business of state oil giant OQ, is expected to price its $771m initial public offering (IPO) at the top of the marketed range, according to terms seen by Reuters. Orders below 140 Omani baisas ($0.36) per share risk missing out on the deal, one of the banks on the transaction said in a message to investors seen by Reuters.

Fitch Upgrades Omantel to ‘BB+’; Stable Outlook

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Fitch Ratings has upgraded Oman Telecommunications Company S.A.O.G.’s (Omantel) Long-Term Issuer Default Rating (IDR) to ‘BB+’ from ‘BB’. The Outlook on the IDR is Stable. We have also affirmed the ‘BB+’ senior unsecured ratings on its USD600 million and USD900 million notes maturing in 2023 and 2028 respectively. The Recovery Rating is ‘RR4’.

Dubai cuts public debt by $7.8bln to 25% of GDP

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Dubai has reduced its public debt by AED29 billion ($7.8 billion) as it managed to settle some of its loans amid strong economic recovery.

The reduction consequently brings down the emirate’s debt burden as a share of its gross domestic product (GDP) to 25%, the Dubai Media Office said on social media, citing the Public Debt Management Office of the Department of Finance.

Market volatility and inflation are CIOs’ keyconcern

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Volatile financial markets and high inflation are the most pressing concerns of asset
managers in the Gulf Cooperation Council (GCC) region, according to our survey of the
sector’s chief investment officers (CIOs). The survey indicates that CIOs expect revenue to
rise as high oil prices support growth in assets under management (AUM), but also anticipate
an increase in operating expenses and competition for new assets.

Omani economy grows by 2.1% in first half of 2023

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Muscat: Dr. Said Mohammed Al Saqri, Minister of Economy has affirmed the recovery of the Omani economy from the impact of the Covid-19 pandemic. This, said the minister, reflects positive developments in the performance of overall indicators, as the Omani economy witnessed a growth in fixed prices, amounting to 2.1 percent during the first half of 2023.

SAL Saudi Logistics Services IPO: cargo company may raise as much as $678m

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The main shareholders in SAL Saudi Logistics Services Company are selling a 30 per cent stake in the company as part of an initial public offering that may raise as much as 2.54 billion riyals ($678 million).

The selling shareholders Saudi Arabian Airlines Corporation, also referred to as Saudia, which owns 70 per cent of SAL, and Tarabot Air Cargo Services that has a 30 per cent stake, are selling 24 million shares at a range of 98 riyals to 106 riyals each in the cargo entity, according to a statement on Monday.

Fitch Upgrades Oman to ‘BB+’; Outlook Stable

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Public Finances Underpin Upgrade:The upgrade reflects the use of high oil revenues to pay down debt and spread its maturity, spending restraint reducing external risks, and an increase in Fitch’s oil price forecast. We project general government debt to fall to 36% of GDP in 2023 and stabilise at around 35% in 2024 and 2025, below the ‘BB’ peer median of 54%. This compares with our forecast of 45% of GDP in 2023 when we last upgraded Oman in August 2022.

Arab countries account for 60% of global Islamic financial industry: Arab Monetary Fund

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Dr Abdul Rahman Bin Abdullah Al Humaidi, Director-General and Chairman of the Board of Directors of the Arab Monetary Fund, said that Arab countries account for about 60 percent of the global Islamic financial industry, which amounted to US$3 trillion by the end of 2021.

He added, in opening a remote course on “Accounting Standards for Islamic Financial Institutions” in cooperation with the Islamic Development Bank, that building the capabilities of workers in this industry and the capabilities of the regulatory and supervisory authorities is a crucial element in the continuation of this industry’s momentum, growth, and development.

Saudi capital market witnesses 204% growth in listings, up from targeted 24 to 49 listings

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RIYADH — Mohammed Elkuwaiz, chairman of the Board of the Saudi Capital Market Authority (CMA), revealed that the authority achieved the highest rate of strategic plan targets in 2022.

“By the end of 2022, CMA was able to achieve higher completion rates than the targets of its strategic plan for the same year in a number of indicators,” he said while announcing that CMA is currently working on developing its strategic plan for the period from 2024 to 2026.

PIF-backed mortgage provider set to expand Saudi’s securitisation market: Moody’s

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Home mortgage provider Saudi Real Estate Refinance Company (SRC) will further strengthen Saudi Arabia’s position as the largest Islamic finance market globally as it expands its balance sheet and becomes a more significant issuer in the sukuk market, Moody’s Investors Service said in a report.

The Public Investment Fund (PIF)-backed SRC will likely fund some of that future growth through securitisations and covered bonds, having relied largely on Shariah-compliant wholesale funding and government backing to date.

White & Case advises on issuance of US$1.5 billion Green Sukuk following simultaneous updates of DP World’s US$10 billion Global Medium Term Note and US$5 billion Trust Certificate Issuance Programmes.

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Global law firm White & Case LLP has advised the arrangers and dealers on the update of DP World Limited’s US$10 billion Global Medium Term Note Programme and US$5 billion Trust Certificate Issuance Programme, and the managers on a US$1.5 billion issuance of Green Sukuk by DP World Crescent Limited under its US$5 billion Trust Certificate Issuance Programme.

Saudi Exchange launches four new indices

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The four new Tadawul indices are: The Tadawul Large Cap Index, Tadawul Medium Cap Index, Tadawul Small Cap Index, and the Tadawul IPO Index.

The launch of the indices aligns with the Saudi Exchange’s ongoing initiatives to provide investors with enhanced benchmark opportunities and stimulate growth in new products for investors.

UAE to Sell Dollar Bonds for the First Time Since June 2022

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The United Arab Emirates raised $1.5 billion from a bond sale on Monday, marking the country’s return to international debt markets for the first time in well over a year.

The 10-year security priced at 60 basis points over Treasuries of similar maturity, according to a person familiar with the matter who’s not authorized to speak publicly and asked not to be identified. The sale had an order book of more than $6.8 billion, the person said.

UAE posts 31.8% growth in revenues in 2022

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DUBAI: H.H. Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance, said that the UAE’s strong fiscal performance and diversified government revenues reflect efficient fiscal policy, with overall fiscal balance surplus recorded in 2022, a 31.8% year-on-year growth in revenues, and a 6.1% increase in expenditures, which amounted to approximately AED427.12 billion.

Oman: OQGN IPO subscription to begin on September 26

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Muscat – The Capital Market Authority (CMA) on Sunday announced the approval of the prospectus for the initial public offering (IPO) of OQ Gas Networks (OQGN), the sole operator of Oman’s gas transportation system.

The subscription period for the IPO will commence on September 26, 2023 for retail investors and instituions categories, the CMA said in a statement on Sunday.

EDO raises $1bn from its inaugural sukuk

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Energy Development Oman (EDO) announced the successful completion of its inaugural benchmark sukuk issuance of US$1bn on Sunday.

The offering was oversubscribed by more than five times, reflecting strong investor confidence in EDO as the national energy leader in the sultanate, a press release said.

Standard & Poor’s confirms Saudi Arabia’s credit rating at A/A-1, stable outlook

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Underlining Saudi Arabia’s robust economic growth, global credit rating agency Standard & Poor’s has reaffirmed its credit rating for the Kingdom in local and foreign currencies to “A/A-1,” with a stable outlook in its recently issued report.

The agency explained the confirmation came against the backdrop of Saudi Arabia’s continued efforts in recent years and its structural improvements that supported the sustainable development of the non-oil sector.

Repos in Islamic Finance – 2

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In our article titled “Repos in Islamic Finance”1 we concluded that Shari’ah-compliant repurchase transactions (“Repos“) could play a useful role as a liquidity management instrument to assist with the short-term liquidity shortages in the Islamic finance industry. For the industry as a whole, a standard template for documenting a Shari’ah compliant Repo would be a useful starting point for all Islamic banks who wish to use the technique.

Saudi debt market next to be reformed amid Vision 2030 developments: CMA chairman

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LONDON: Saudi Arabia’s debt capital market is set to be redeveloped in a bid to help the Kingdom’s business acquire funding, the chairman of the Capital Market Authority has confirmed.

Speaking at the EFG Hermes Saudi Forum in London, Mohammed El-Kuwaiz insisted that any changes to the Saudi financial system need to occur gradually to ensure economic stability, but said the aim was to make the Kingdom as competitive on the global stage as possible.

Fintech, digital sukuk could spur Islamic finance growth in Middle East

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Fintech companies and digital sukuk could be two key growth drivers of the global Islamic finance industry in the Middle East and North Africa in the coming years, according to a senior executive at the Standard & Poor’s rating agency.

The Gulf has seen a boom in funding for fintech startups, increasing by more than fourfold from $200 million in 2020 to $885 million in 2022.

 

Fitch Upgrades DP World to ‘BBB+’, Outlook Stable

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Fitch Ratings has upgraded DP World Limited’s (DPW) Long-Term Issuer Default Rating (IDR) to ‘BBB+’ from ‘BBB-‘. The Outlook is Stable. The Short-Term IDR has been upgraded to ‘F2’ from ‘F3’. A full list of rating actions is at the end of this rating action commentary.

Fitch Upgrades SABIC to ‘A+’

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The upgrade follows the upgrade of SABIC’s majority parent, Saudi Arabian Oil Company (Saudi Aramco; A+/Stable), which in turn followed the upgrade of the Saudi Arabian sovereign rating to ‘A+’/Stable

ADNOC Gas increases number of shares in IPO

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ADNOC Gas, a subsidiary of state oil giant Abu Dhabi National Oil Company (ADNOC), has increased the number of shares available in its initial public offering (IPO) to 3.84 billion shares, from 3.07 billion, amid “significant demand” from investors.

KIPCO completes KD 165 million six-year bond issue

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The bonds, maturing in December 2028, were available in fixed and floating rate tranches, with the floating tranche attracting 67% of the allocation. The fixed rate bond pays investors a coupon of 6.75% annually, while the floating rate pays investors a coupon rate of 3% annually over the declared Central Bank of Kuwait discount rate.