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FOREIGN FLOWS | Page 7 CHINA VIEW | Page 17 Modi magic OECD sees seen lasting in growth down India stocks at 6.5% in ’17 Wednesday, March 22, 2017 Jumada II 23, 1438 AH WINNING STREAK: Page 20 GULF TIMES QSE advances on stronger buying support from BUSINESS foreign institutions Rosneft signs LNG deal with Egypt for CI affi rms QNB ratings 10 cargoes this year North African Nation turned to imports two years ago; Rosneft plans to join Eni-led Zohr gas project to boost output on par with Qatar’s Bloomberg Moscow ussia’s largest crude producer, Rosneft joined trad- ers from Trafi gura Group to Glencore in boosting Rliquefi ed natural gas deliveries to Egypt before the with a stable outlook country restores domestic production. Rosneft, which seeks to expand its international gas By Santhosh V Perumal business, signed a contract to supply the north African Business Reporter nation with 10 LNG cargoes this year, Rosneft said yester- day by email. The deal, which followed a debut contract of three cargoes last year, will further strengthen the strate- apital Intelligence (CI), a global gic partnership between Rosneft and Egypt, the company credit rating agency, yesterday af- said. Cfi rmed QNB’s long and short-term Egypt, Africa’s largest gas market, was forced to turn to foreign currency ratings (FCRs) at ‘AA-’ imports two years ago as domestic production shrank at and ‘A1+’ respectively, at the same level as the same time as electricity demand is rising. The coun- the sovereign ratings for Qatar. try plans to purchase more than 100 LNG cargoes this The bank’s support rating of ‘1’ (affi rmed) year, including as many as 45 cargoes via government-to- refl ects the ownership by the Qatar Invest- government contracts from Rosneft, Oman and France’s ment Authority and its role as the fi nancial Engie, a person familiar with the matter said last month. arm of the government. The outlook on the The north African nation is targeting a reduction in im- long-term FCR is restored to ‘stable’ from ports next year, moving back to self-suffi ciency or even ‘negative’. exports after the planned commissioning of two major gas Asset quality and capitalisation of QNB - projects. Rosneft seeks to join one of them, the giant Zohr which has already achieved a high degree of fi eld, after it agreed to buy a share in the development diversifi cation of its assets, funding sources from Italy’s Eni, the project’s main owner. and profi ts with its presence in more than Egypt plans to boost gas output by 50% by the end of 30 countries - are expected to remain good next year from 3.8bn cubic feet by the end of 2016. It tar- with capital adequacy ratio to be main- gets a resumption of exports in 2019. tained at around 16% through additional Rosneft has long sought to build up its gas business. Tier 1 or Tier 2 capital, if necessary, it said. It overtook Novatek to become Russia’s second-largest Profi tability should remain good with any producer last year, but it has no LNG facilities of its own. pressures on domestic net interest margin Last year’s cargoes for Egypt, the fi rst-ever LNG deal for (NIM) being at least partially off set by the Asset quality and capitalisation of QNB - which has already achieved a high degree of diversification of its assets, funding sources and the company, were bought on the open market. Rosneft higher NIMs in Egypt and Turkey. profits with its presence in more than 30 countries - are expected to remain good with capital adequacy ratio to be maintained at around is mulling building an export plant near Russia’s Pacifi c Finding that QNB’s performance is no 16% through additional Tier 1 or Tier 2 capital, if necessary, CI has said. coast no earlier than 2023. It is also considering a Ven- longer solely a function of its domestic ezuelan LNG project. market, CI said it also depends on economic coverage ratio remains well in excess of the QNB has mitigated this by diversifying its In the meantime, QNB is expected to The LNG deliveries to Egypt will start in May, Rosneft performance in Egypt and Turkey and in the regulatory minimum. business organically and through acqui- continue to access capital markets to fur- said. countries in which it has branches, subsidi- The FSR is constrained to some extent sitions, the latest being the purchase of ther grow and diversify its longer term aries and affi liates. by the relatively tight ratio of loans-to- Turkish Finansbank, which has otherwise funding base. Affi rming QNB’s fi nancial strength rat- customer deposits, and by a fairly tight impacted its “reasonable” cost metrics While the rising exposure to coun- Rosneft , which has ing (FSR) at ‘AA-’ with “stable” outlook, it net liquid asset ratio; partly refl ective of compared to Qatari banks and its larger re- try and foreign exchange (forex) risks long sought to build said the FSR is supported by very good as- the sovereign decision in 2014 to begin to gional peers. on overseas subsidiaries and associates up its gas business, set quality, strong capitalisation and good deleverage by reducing borrowings and de- “At its current very high level of ‘AA-’, is to some extent a constraint, CI said overtook Novatek profi tability, particularly at the operating posits with banks. The quasi liquid asset QNB’s FSR nonetheless remains somewhat all foreign subsidiaries are self-funding to become Russia’s level. ratio is, nevertheless, strong while the net pressured on liquidity. However, liquid- with future forex risks partially hedged, second-largest Although tightening liquidity is the main quasi-liquid asset ratio is “satisfactory”. ity conditions domestically have eased”, CI and hence “unlikely to exert significant producer last year, constraining factor, QNB’s deposit base is The FSR is also constrained by Qatar’s said, assuming suffi cient liquidity injection downward pressure” on the FSR, unless but it has no LNG sound and access to well-diversifi ed global small population size and therefore the op- by the Qatari government into the banking the cross-border exposure levels increase facilities of its own funds is good, CI said, adding the liquidity portunities to grow domestic lending, but system, if needed. markedly. Page 20 QGIRC growth strategy: Focus on core businesses, realty projects By Santhosh V Perumal in 2016, Sheikh Nasser said this Business Reporter increase reinforces its strategy on the management of real estate portfolio, which continues to earn revenues and Qatar General Insurance and increase total liquidity. Reinsurance Company (QGIRC) will not “We are maintaining our focus towards only strengthen its core businesses on converting our non-income-producing exponentially growing demand for risk land into income producing holdings,” cover, especially for large infrastructure he said, adding the aim is to maintain projects, but also focus more on real the leading position in the insurance estate projects. and real estate investment industries in “Our main objective is to expand in the country, considering that Qatar is the insurance areas, focus on the real one of the fastest growing economies estate projects currently executed by in the world. the company, enhance the capabilities Its group company General Real Estate and increase the financial eff iciency Company has seen a stable year in in compliance with international 2016 with projects continuing to meet standards and criteria,” QGIRC their targets. chairman and managing director QGIRC group chief executive Ghazi Sheikh Nasser bin Ali bin Saud al-Thani Abu Nahl said the slowdown in told shareholders at the annual general infrastructure expansion is expected assembly meeting yesterday. to ease by the end of this year. “We While international and local markets are likely to see an increased demand were aff ected by the prevailing for insurance on large infrastructure conditions of oil prices, which projects,” he added. consequently had its impact on the Qatar General Holding, which owns insurance industry, QGRIC managed most of the group’s subsidiaries and to achieve a 42% jump in net profit manages the group’s treasury and from previous year after excluding investment portfolio, said its “cautious” the revaluation gains of investment outlook on investments would properties, he highlighted. remain this year as it seeks to achieve QGIRC - whose coverage ratio of the reasonable returns, while maintaining QGIRC off icials outline the company’s 2017 growth strategy to the shareholders yesterday. available economic capital stood an appropriate level of diversification. at 294% as on December 31, 2016 - “We approach 2017 with cautious Holding deputy chief executive said. “significantly” lower the construction and further the development of “The recent securement of notable reported a net profit of QR258mn on optimism as infrastructure spending About realty projects, Ragheb Jalabi, costs of its projects, which include Oriental Enterprises (acquired in 2015),” medium and large size real estate gross written premium of QR838mn is set to pick up and the turbulent general manager of General Real Estate Lusail Fox Hills, Lusail Waterfront and he said. projects will enable us to bolster our (including takaful business) in 2016. conditions we have experienced Company, said a more realistic and Mozoon Towers. Remaining positive on Qatar’s standing within the market place, and Highlighting that its total equity throughout last year are expected to competitive pricing strategies of its “These cost savings enabled us to development path, Oriental Enterprises put us in a strong position to win further grew 2% year-on-year to QR6.4bn ease,” Abdallah Barrage, Qatar General suppliers and contractors enabled it to realign capital towards new projects general manager Adib El Choufani said, work in Qatar’s rapidly growing market.” Gulf Times 2 Wednesday, March 22, 2017 BUSINESS Iran struggles to coax Bank of England to open clearing accounts Reuters the talks, said Tehran has approached the Tehran said: “The Bank of England has sus- ence in the main global financial centre countries to allow it back into the interna- to do more, so far there had been no London/Ankara Bank of England to seek clearing accounts pended anything related to Iran, even the outside of the United States.

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