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BLOM MENA Banking Index.

In what was a relatively quiet month, National Bank of Abu Dhabi (NBAD) was appointed lead advisor to the Partnerships Technical Bureau (PTB), an arm of the Kuwait Ministry of Finance, for its ambitious development plans for Failaka Island, Kuwait. The 43 square kilometre Al Failaka Island is located approximately 26 kilometers north east of Kuwait City.

The Kuwait Government intends to develop the Island in accordance with its 'Vision 2035 Plan' that envisages developing Kuwait into a financial, commercial and leisure centre. As part of its role, NBAD would also advise the PTB on funding solutions to develop Failaka Island into a world class hospitality destination point targeting the Gulf Cooperation Council and the greater MENA markets.

Meanwhile, in Qatar, Goldman Sachs decided to raise Commercial Bank of Qatar's target price to QAR 123.85 ($34), from QAR 112.78 ($30.90) and at the same time, it retained its buy rating for the bank, citing estimates that it would increase its net income by around five per cent between now and 2014.

This was backed up by Rasmala, which said in a report, "Our growth forecast for 2011 in particular now looks overly conservative. However, more important, this goes a long way to establish proof of principle for CBQ being a premium growth story. We believe this more than justifies our price target and recommendation on the stock as a sharply discounted bank with top-tier growth prospects. Nevertheless, the stock remains much more popular with international investors than locals, and until foreign ownership limits are raised, it remains debatable how quickly the valuation discount will clear. Our recommendation remains Buy despite recent modest outperformance."

On the Islamic capital markets side, Saudi Aramco Total Refining and Petrochemical Company (SATORP) appointed Deutsche Securities Saudi Arabia; Samba Capital and Saudi Fransi Capital as Joint Lead Managers and Joint Bookrunners for its Sukuk, which is expected to be around $1 billion.

Banks from across the region were active with their Holy Month of Ramadan offerings, although a poll on the CPI Financial website which asked 'Are Ramadan financial promotions merely a gimmick?' found that a vast majority of respondents (70 per cent) believed that they were. This suggests that consumers may feel that banks are being opportunistic and it also means that banks' promotional offerings may require something of a rethink before the next Holy Month in 2012.nBME

2011 CPI Financial. All rights reserved.

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Publication:Banker Middle East
Geographic Code:7KUWA
Date:Sep 26, 2011
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