MSM Index: 53

MENA Morning Note Tuesday, October 02, 2018

ECONOMIC NEWS Value Previous % Oil markets were strong again on Tuesday, with Brent crude holding above $85 and near GCC four-year highs reached the previous day as markets prepare for tighter supply once U.S. 01-Oct-2018 Closing Change sanctions against Iran kick in next month. Sentiment was lifted by a last-gasp deal to MSM 4,538.08 4,543.68 -0.12% salvage NAFTA as a trilateral pact between the United States, Mexico and Canada, rescuing a $1.2 trillion a year open-trade zone that had been about to collapse. More Dubai 2,849.56 2,834.95 0.52% fundamentally, oil markets have been pushed up by looming U.S. sanctions against Iran’s Abu Dhabi 4,979.58 4,935.37 0.90% oil industry, which at its most recent peak this year supplied almost 3 percent of the world’s almost 100 million barrels of daily consumption. Trade data in Refinitiv Eikon Saudi Arabia 8,038.07 7,999.54 0.48% showed Iran’s seaborne exports in September were just 1.9 million barrels per day, the Bahrain 1,335.06 1,338.55 -0.26% lowest level since mid-2016. (Reuters) Qatar 9,790.20 9,813.32 -0.24% Asian stocks were steady on Tuesday as Japanese equities rose to a fresh 27-year high Kuwait 5,121.62 5,121.62 0.00% while crude oil prices were elevated in the afterglow of an agreement that salvaged a North American free trade deal. The United States and Canada forged a last-minute deal Egypt 14,446.72 14,616.47 -1.16% on Sunday to salvage NAFTA as a trilateral pact with Mexico, rescuing a three-country, 8,243.32 8,432.41 -2.24% $1.2 trillion open-trade zone that had been about to collapse after nearly a quarter

century. (Reuters) Value Asia % Change Banks in the GCC should continue to breathe a little easier in the year ahead, S&P Global 02-Oct-2018 Ratings said in its Industry Credit Outlook released Monday. The report said “2019 NIKKEI 24,270.62 0.10% should mark a stabilization of GCC banks' financial profiles, following three years of Hang Seng 27,134.65 -2.35% significant pressure. What's more, with the transition to IFRS 9, GCC banks have now recognized most of the impact of the softer economic cycle on their asset quality. We Shanghai 2,821.35 1.06% therefore believe that the amount of problematic assets, which we define as IFRS 9 Stage Value USA % Change 2 and 3 loans, will likely remain stable, but do not exclude transition between the two 01-Oct-2018 categories.” “We expect GCC economies to show stronger economic growth in 2019 of about 2.8% (unweighted average of Saudi Arabia, Kuwait, the United Arab Emirates, Dow Jones Ind. 26,651.21 0.73% Qatar, Bahrain, and Oman). However, this growth will still be below the triple-digit oil- S&P 500 Index 2,924.59 0.36% price era growth of 2011-2013. We therefore expect lending growth to remain at around the mid-single digits. At the same time, we think that cost of risk will stabilize at around NASDAQ 8,037.30 -0.11% 1.0%-1.5% of total loans. Thanks to IFRS 9, the buffer of provisions that GCC banks Value EUROPE % Change accumulated over the past years is now stronger. The new reporting standard, adopted 01-Oct-2018 from the start of this year, required banks to set aside provisions in advance, based on FTSE 100 7,495.67 -0.19% their loss expectations.” Moreover, the report noted that “finally, we think that GCC banks› profitability will stabilize. It will benefit from the higher interest rates and the DAX 12,339.03 0.75% significant amount of non-interest-bearing deposits sitting on banks› balance sheets.” CAC 40 5,506.82 0.24% higher oil prices and stronger public investments are resulting in higher economic growth

across the GCC in 2018. “We forecast that oil prices will stabilize at about $65 per barrel Value in 2019 and $60 I 2020, and we anticipate unweighted average economic growth of 2.8% Currencies % Change 02-Oct-2018 in 2019-2020 for the six GCC countries. This is less than a half of what they delivered in 2012, but more than five times higher than their performance in 2017. Growth in lending USD-JPY 113.7700 0.14% recovered slightly, reaching an annualized 4.7% at midyear 2018. We expect a slight acceleration in the next two years barring any unexpected shock. “Higher government USD-OMR 0.3850 0.00% spending, supported by strategic government initiatives, will support the lending growth. EUR-USD 1.1539 -0.34% Furthermore, GCC banks funding profiles are seen as satisfactory. Funding is dominated by core customer deposits, and the use of wholesale funding remains limited except for a GBP-USD 1.3010 -0.25% few large and sophisticated issuers. The GCC banking system›s loan-to-deposit ratio averaged 88.4% as of June 30, 2018, compared with 87.8% at year-end 2017. The ratio of cash and money market instruments to total assets remained stable over the past 18 Value Commodities % Change months due to muted loan growth, still growing deposits, and the deployment of excess 02-Oct-2018 liquidity in government debt issuances. “We think that government issuances will Oil 75.82 0.69% continue to attract the attention of local and regional banking systems. As of June 30, 2018, the coverage of short-term wholesale funding by broad liquid assets stood at about Gold 1,197.50 0.49% 4.7x on average for rated GCC banks, compared with 3.7x at year-end 2016.” (Zawya) Silver 14.62 0.74%

THE Islamic Research and Training Institute of the Islamic Development Bank Group, United Nations Development Program and Securities Commission Malaysia have Note: All the above data updated at 8:00 AM, collaborated to promote the use of Islamic financing instruments to meet the funding Muscat time (5:00am GMT) requirements of the Sustainable Development Goals. The huge funding needed to meet the 2030 Agenda for Sustainable Development far surpasses the resources available to individual governments and multilateral agencies, thereby making it imperative to join forces and to diversity sources of mobilizing financing for development projects. With its underlying principles that emphasize risk sharing and responsible financing, Islamic

This report has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. While all care has been taken to ensure that the facts stated herein are accurate and the estimates, opinions and expectations contained herein are fair and reasonable, neither United Securities LLC, nor any of its employees shall be, in any way, responsible for the contents. This shall not be construed as an offer to buy or sell the investments referred to in this report.

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MENA Morning Note Tuesday, October 02, 2018

finance has been tipped as a viable mechanism for mobilizing resources in this regard. In joining hands to advocate leveraging the potentials of Islamic finance for the SDGs, IRTI together with UNDP and SC today hosted a high-level forum entitled “Achieving the SDGs: Unleashing the Potential of Islamic Finance through Innovative Investors and Instruments”, on the sidelines of the 73rd United Nations General Assembly at the UN Headquarters in New York. (Zawya)

Oman Efforts to address credit downgrades, support the growing Islamic finance segment and tackle the challenge of delayed payments were among the topics explored by Tahir Salim Al Amri, the Executive President of the Central Bank of Oman, at a meeting he had recently with a team from Oxford Business Group. On March 16, rating’s agency Moody downgraded the long-term issuer and senior unsecured bond ratings of Oman’s government to Baa3 from Baa2, while retaining a negative outlook for the sultanate. It cited an expectation that Oman's fiscal and external metrics would continue to weaken as the primary reason for the downgrade, adding that slow growth in the coming years would weaken economic resiliency. Al Amri told OBG’s team that the fiscal reforms introduced, including reductions in subsidies, a rationalisation of expenditure and measures aimed at increasing non-oil revenues, were moving forward. Other topics explored by Al Amri include Oman’s fast-developing Islamic finance segment, which has moved from recording losses in its early days to robust year-on-year (y-o-y) growth of 31.8%, or OR700m ($1.8bn) in financing to OMR2.9bn ($7.5bn) at the end of September 2017, up from OMR2.2bn ($5.7bn) y-o-y. The segment’s total assets were also up in the same period, increasing by 23.8% to reach OR3.8bn ($9.8bn) from OR3.08bn ($8bn). Al Amri told OBG that the introduction of a range of Islamic liability products and better understanding of the structure of their returns had combined to significantly increase inflows. He acknowledged, however, that managing liquidity in the segment remained a challenge. (Zawya)

An agreement was signed to set up a Tawasul Charitable Organisation in the Special Economic Zone Authority in Duqm. Tawasul aims to provide financial support and fund projects for the benefit of local communities in the Special Economic Zone in Duqm in particular and the Al Wusta Governorate. It also aims to promote sustainable economic and social development according to the areas of work defined in its Articles of Association. These include entrepreneurship, training, education for work, health, environment, and supporting associations and sports clubs. The agreement of "Tawasul Charitable Organisation” was signed by officials of eight companies: Duqm Refinery and Petrochemical Industries Company, Oman Development Company for the Economic Zone of Duqm, , Oman Petroleum Development Company, Port of Duqm Company, Oman Dry Dock Company, Oman Airports, Sebacic Oman Company, and Nahdat Al Duqm Holding Group. (Times of Oman)

The Oman Chamber of Commerce and Industry is organising a visit to Kuwait by a delegation headed by Qais bin Mohammed Al Yousuf, Chairman of the OCCI, and a number of business owners and representatives of companies and institutions in the private sector. This delegation visit comes within the framework of the joint cooperation between the OCCI and the Chamber of Commerce and Industry of Kuwait, which seeks to open new investment and commercial ties, as well as to learn about the opportunities and possibilities of investment in both the countries and also to identify the Sultanate's investment opportunities and commercial attractions and sectors targeted by Oman Vision 2040. Also on the sidelines of the visit, the Omani-Kuwaiti Economic Forum will be held, which will include bilateral meetings between businessmen from both sides. The delegation includes more than 30 Omani companies working in various fields including oil and gas, tourism, real estate development, investment and logistics, food and traditional national industries. (Times of Oman)

UAE The International Monetary Fund lifted its forecasts for economic growth in the United Arab Emirates because of expectations that oil production and state spending will rise. The Arab world’s second biggest economy is now likely to expand 2.9 percent this year and 3.7 percent next year, Natalia Tamirisa, IMF mission chief to the country, said late on Sunday. Gross domestic product grew 0.8 percent in 2017. In April, the IMF had predicted GDP would expand 2.0 percent this year and 3.0 percent next year. A deal among global producers to cut oil output was eased in mid-2018, letting the UAE start raising output. Meanwhile, rebounding oil prices have given the government more money to spend; on Sunday, the UAE cabinet approved a 17.3 percent rise in the UAE federal budget for 2019 compared to this year. This may compensate for sluggish growth in the private sector, which faces rising interest rates as U.S. monetary policy tightens and has also been hit by slumping property prices. (Reuters)

Saudi Arabia The Saudi Ministry of Finance’s planned “centralized” procurement unit will help coordinate purchases of commonly-used goods and services across government bodies, thus ensuring higher efficiency and more competitive prices. The establishment of a centralized procurement unit falls under the ministry’s drive to regulate the governmental procurement procedure, with aim to ensure equal opportunities and transparency, while supporting local content. (Argaam)

Tadawul approved a request from the Ministry of Finance to list debt instruments reissuance worth SAR 4.78 billion tomorrow, Oct. 2. The Saudi exchange will raise the issuance dated July 5, 2018 by SAR 2.74 billion to SAR 7.1 billion. The value of the issuance dated July 7, 2018 will be increased by SAR 1.54 billion to SAR 3 billion, while the issuance dated July 10, 2018 will be boosted by SAR 495 million to SAR 2.15 billion. The request was submitted by the Ministry of Finance as per the Listing Rules approved by the Capital Market Authority. (Argaam)

Saudi King Salman bin Abdulaziz Al Saud has ordered that a donation of $200 million should be allocated to the Central Bank of Yemen to support the country's economy against the backdrop of the Yemeni national Currency collapse provoked by ongoing military action. According to the Saudi Press Agency, the new contribution would complement $3 billion earlier deposited in the Yemeni Central Bank. The Saudi authorities expect the donation to alleviate the economic burden of the Yemeni people. The exchange rate of Yemen's rial to the US dollar has recently halved compared to prewar figure, which resulted in a sharp increase in prices of goods and services. At present the official rate of exchange is over 250 Yemeni rials to one US dollar. (Urdupoint)

Saudi Arabia’s banking sector earnings are likely to continue to improve in Q3, 2018 along with a moderate growth in the asset yields. However, the brokerage firm expects the loan book growth to be weak in Q3 as it believes loan growth needs an impetus from large government projects before

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MENA Morning Note Tuesday, October 02, 2018

private capex could pick up. Overall, however, the report expects like-for-like sales declining across consumer companies. Conversely, it continued, nationalization in automotive, apparel, home appliances and furniture from mid-September could help gain market share for the market leaders in their respective segments. For the retail sector, Al Rajhi Capital expects bottom-line to decline around 14 percent YoY in Q3 2018, while for the cement sector sales volumes and prices are expected to be flat compared to the previous quarter. (Argaam)

Qatar Qatar has started proceedings against Saudi Arabia at the World Trade Organization, accusing it of intellectual property rights violations. Part of Qatar’s concerns involve the blocking of Qatari-owned broadcaster beIN in Saudi Arabia, the ministry said on its website, and accused Riyadh of refusing to take effective action against the piracy of beIN content in the kingdom. Saudi officials were not immediately available to comment. They have previously said that the country is taking action to combat piracy and is committed to protecting intellectual property rights. Global sports network beIN Sports is blocked in Saudi Arabia under a boycott the kingdom imposed on Qatar over a year ago. Riyadh and Arab allies severed diplomatic and trade ties with Qatar in June 2017 over its alleged support of terrorism. Doha denies the accusations and relations remain hostile. Qatar said it submitted a request at the WTO for formal consultations to address its allegations against Saudi Arabia, which include the pirating of beIN content by beoutQ. A WTO official confirmed the request had been submitted. It is unclear who owns beoutQ or where it is based, though the broadcaster is widely available in Saudi Arabia. Following accusations of piracy of beIN content in Saudi Arabia, a Saudi official said in June the kingdom had confiscated about 12,000 pirating devices from the market. (Reuters)

Kuwait Kuwait’s central bank decided to keep its key discount rate unchanged at 3.0 percent. The decision followed the announcement of a 25 basis point interest rate hike by the U.S. Federal Reserve. In contrast to the other rich Gulf Arab oil exporting states, which peg their currencies to the U.S. dollar and have little room for an independent monetary policy, Kuwait manages its dinar against an undisclosed basket of currencies in which the dollar plays a major role. This gives it more room to diverge from U.S. policy if it believes domestic economic conditions warrant that. Three months ago, when the Fed last raised rates, the Kuwait central bank also kept its key rate unchanged. In a statement on Wednesday, central bank governor Mohammad al-Hashel said that instead of raising its discount rate, the bank would use other policy tools to manage the money market, such as issues of bonds and Islamic instruments, acceptance of term deposits from local banks, and direct interventions. He noted that domestic banking credit was expanding only modestly because of tepid growth in the non-oil areas of the economy. (Reuters)

CORPORATE NEWS

Oman Bank Sohar would like to announce the appointment of Mr. Khalil Salim Sulaiman Al Hedaifi in the positon of the general manager- Chief REtial Banking Officer as of today, the 1st of October 2018. (MSM)

State-run Oman Oil Co is set to raise an $850 million revolving credit facility. The unsecured loan will be provided by a consortium of more than 10 banks and will be finalised over the next few weeks. The $850 million facility will refinance an $850 million revolving loan due in 2019, said the sources. Oman Oil did not immediately respond to a request for comment. Oman Oil completed in July last year a $2 billion financing which included a $1.15 billion revolving credit facility with a five-year maturity and the amendment of the terms of the $850 million revolving loan maturing in 2019. The $850 million loan was part of a dual-tranche $1.85 billion financing the company raised in 2014. The financing last year was provided by a group of banks including Credit Agricole, Deutsche Bank, First Abu Dhabi Bank, HSBC, Natixis, Societe Generale, Standard Chartered and Sumitomo Mitsui Banking Corp. The new $850 million transaction is self-arranged, said the sources, meaning that the borrower is coordinating the fundraising by putting together a group of banks. (Reuters)

Ahlain supermarkets at Oman Oil service stations in the country will soon be fully run by the company themselves. Ahlain supermarkets are currently present across 108 locations in the Sultanate, and are currently run in partnership with Khimji and Enhance, but David Kalife, CEO of Oman Oil Marketing Company, said that the company is working on a plan to ensure that all their supermarkets will be run by them, as the plan will be gradually rolled out in 2019. The move is part of Oomco’s roadmap to achieve growth, with significant emphasis placed on the non-fuel sectors, so as to diversify the company’s offerings and provide value to customers and stakeholders alike. Oman Oil Marketing’s plan to improve the offerings in the food and services sector has also seen it enter into a long-term partnership with Café Amazon, a Thai provider that is well known in its country of origin, and has already begun operations in Oman Oil stations in the Sultanate. (Times of Oman)

Nama Group has announced the commencement of the live operation of their centrally implemented Automatic Meter Reading project designed for high value customers in the electricity sector in Oman. The project was carried out by a professional team of Omani experts from the electricity distribution companies in Nama Group in partnership with CESI Middle East FZE, a subsidiary of CESI and WIPRO Limited as the system integrator. The AMR system is a central standard smart metering system that will enable electricity companies to obtain accurate, hourly meter readings from high value customers and collect their consumption in an automated manner. CESI has been supporting the project since its inception in 2015, and the company’s role has been to manage the project activities to ensure the efficient coordination and delivery of several contractors, service providers and manufacturers involved in the project’s extensive implementation. (Oman Observer)

SalamAir celebrated a total lift of one million-passengers since launching its operations in 2016. The airline enjoyed a steady rise in passenger footfall powered by its expanding route network, competitive price offers, as well as a customer-centric loyalty programme to meet the increased demand for affordable travel options around the region. Marking this milestone, SalamAir celebrated its one millionth passenger at its check-in counter at Muscat International Airport. (Oman Observer)

UAE Dubai Investments PJSC announces its real estate projects portfolio which will be showcased at Cityscape Global 2018, stand SAH10A in Trade

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MENA Morning Note Tuesday, October 02, 2018

Centre Arena at Dubai World Trade Centre from 2nd – 4th October, 2018. Dubai Investments will showcase Mirdif Hills, a mixed-use, residential, commercial, and retail development by DIRC and the only freehold development currently in Mirdif. The project is spread across 1 million sq. ft of land and 4 million sq. ft of built up area that features a four-star hotel managed by Millennium Hotels & Resorts with 116 rooms, 128 serviced apartments, retail units, a 230-bed hospital, and around 1,500 apartments comprising a mix of studio, one-, two-, and three-bedroom apartments and 3 & 4 duplexes. Construction on the project is progressing as scheduled with 50% already completed. Interested buyers will benefit from a 50% DLD fee reduction. The Company’s units are on offer for buying and leasing and the Company is granting tenants a free month when they rent for 12 months and a 100% waiver off DLD fees once they purchase any unit at Green Community West 3, DIP. Moreover, visitors to the company’s stand would benefit from a 30% discount on furniture and accessories from Interiors LLC, a 30% discount on selected carpets from Iwan Maktabi at The Dubai Mall, and a 15% discount on Teka kitchen appliances at Al Garhood showroom. During the exhibition, Dubai Investments showcases 11 projects forsale and leasing. These developments include The Market Expansion which is located within Green Community in DIP and the AED 900- million DI Tower, a mixed-use tower on Sheikh Zayed Road, which is slated for a 2020 completion date and will feature over 70 floors that also include furnished apartments. The remaining projects will comprise of Al Kawthar building in Sharjah, Al Nahda 1, Al Nahda 2, and Al Nahda 3 Towers, Ritaj - a residential community in Dubai Investments Park, Al Mozna building in Qusais, a tower in Meydan and another in Al Barsha First, Al Hamriya Hotel, and Violet Tower in JVC. (DFM)

Union Properties will be launching its mixed-use urban lifestyle destination, Avenue District, at the Cityscape Global 2018 expo which opens in Dubai tomorrow. Being developed as part of Dubai Motor City Phase Two, the Dh2.8-billion Avenue District will feature an eclectic mix of elegantly designed residential units, and the flagship One Avenue Mall. The flagship project, spanning over two million sq ft, is another significant milestone in Union Properties' commitment to delivering best-in-class community living experiences. Union Properties said the first residential community within the Avenue District, 313 Avenue, will comprise 67 studios, 156 one- and 166 two-bedroom apartments. The contemporary low- rise community, offers the finest in leisure, dining, entertainment and sport facilities to residents in the area. Updates on aed 3.2 billion project from adnoc lng to unit target engineering consortium with tecnicas reunidas. Arabtec holding says unit target engineering’s share of contract value is expected to be between 40 percent and 50 percent. Avenue District will also be home to the ultra-modern 100,000 sq ft BMW and Mini showroom. The first automotive dealership to open in the area will boast a minimalist and modern design with glass panels allowing a full view of the workshop area. The facility will use special materials to reduce energy consumption and emissions, as well as incorporate recycling methods for water, oil and batteries to achieve full compliance with Dubai Municipality sustainability regulations. Located within the Phase 2 expansion of Dubai Motor City, Avenue District will be bisected by Sheikh Mohammed Bin Zayed Road (E311) and Al Qudra Road that feeds onto Sheikh Zayed Road (E11) via Umm Suqeim Street, allowing ease of access to Dubai International Airport and Dubai Expo 2020. (Zawya)

Abu Dhabi’s state investor International Petroleum Investment Company is to reorganise about $6 billion of debt following its merger with state investment fund Mubadala Development Company last year. IPIC has asked bondholders to agree to Mubadala Investment Company - the merged entity - becoming guarantor and MDC the issuer of over $6 billion of IPIC's existing debt. "The end result will be a more efficient single, rated entity within the group responsible for our capital market funding activities”. The planned reorganisation of the bonds means IPIC and MDC's debt will sit under only one public investment vehicle, MDC. The request to bondholders covers holders of $1.5 billion IPIC bonds due in 2020, 1.25 billion euro ($1.45 billion) bonds due in 2021, $1.5 billion due in 2022, 850 million euro due in 2023, 550 million pounds ($716.82 million) maturing in 2026 and $750 million due in 2041, according to IPIC's announcement. BNP Paribas, Citi, Deutsche Bank, First Abu Dhabi Bank, and Merrill Lynch International have been appointed to work on the proposed transaction. S&P Global Ratings said the debt transfer to MDC did not change its view on the credit worthiness of the company or its rating. MDC is rated AA by the agency. "The transfer of strategic assets to MDC from IPIC will broaden MDC's asset base and support its mandate to develop and diversify Abu Dhabi's economy," S&P said. (Zawya)

Gulf Energy Maritime is working with Perella Weinberg Partners to try to restructure its roughly $350 million in debt as it seeks to stave off a default. The Dubai-based product and chemical tanker company, which counts Emirates National Oil Company, Mubadala Investment Co and Oman Oil Co as its three main shareholders, has been asking its creditor banks to amend and extend its debt. GEM, which has struggled with depressed demand in the tanker market, is currently in technical default as the estimated $270 million value of its assets, in the form of its fleet, has dipped below that of its debt. The firm is now seeking to reach a breakthrough in negotiations with creditors to help avoid the possibility of an actual default, which could happen as early as this month. Formed in 2004, GEM has a fleet of 19 trading ships, according to its website. GEM and Perella Weinberg Partners did not immediately respond to requests for comment. One of the challenges facing GEM is that some of its creditors are asking for guarantees on their debt or they will seek to take over the assets. Another complication is that one of the lenders, Standard Chartered, is potentially in a better position than the others as its exposure is collateralised, meaning it is protected in case of a default. As a result, it did not share the same thinking as other creditors on how to resolve the negotiations, the two sources said. (Zawya)

Italian fashion house Roberto Cavalli has signed a partnership agreement with DAMAC Properties under which it will provide the interior design for at least five luxury hotels, starting with a first one to be built in Dubai by 2023. The agreement, which follows a separate collaboration with DAMAC on Cavalli-branded villas, is part of the company's bid to expand the luxury and fashion brand into lifestyle categories and find new sources of revenue for the Florentine label famous for its animal prints. Company officials declined to give financial details of the deal. Roberto Cavalli is on track to break even this year and return to a net profit in 2019, Chief Executive Gian Giacomo Ferraris said at an event to announce the hotel project on Monday. He declined to comment on market speculation that Italian private equity group Clessidra, which bought 90 percent of Roberto Cavalli in 2015, might be looking to sell, other than saying that management was focused on executing a strategy agreed with the shareholder. (Zawya)

Imkan on Monday announced an integrated second-home destination AlJurf along Sahel Al Emarat - the Riviera situated in Ghantoot between Abu Dhabi and Dubai. Construction on the 370-hectare project boasting 3.4 kilometers of azure beachfront will begin in 2019. Once complete, the destination will comprise of three distinct districts, AlJurf Gardens, Jiwar Al Qasr and Marsa AlJurf, each with its own architectural characteristics and a range of facilities and amenities. The destination will feature two marinas, private berths, a town-center, hotels, retail, a wellness resort and clinic component, serviced residences and villas. AlJurf will also provide residents with access to public and private beaches, beach clubs and restaurants, community centers, parks, mosques, clinics and a private school. Walid El Hindi, CEO of Imkan, said the first phase of AlJurf Gardens is scheduled for completion in 2021, it will comprise of 293 villas and plots set in a uniquely green environment featuring private coastal ranches and

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MENA Morning Note Tuesday, October 02, 2018

chalets reminiscent of Rivieras similar to the Hamptons in New York. A heritage village (Jiwar Al Qasr) and marina district (Marsa AlJurf) will complement the precinct. (Zawya)

Dubai developer Deyaar has appointed Condor Building Contracting as the main contractor for its newly launched residential project Bella Rose, it announced on Saturday. As part of the 26-month contract, Condor Building Contracting has already begun construction works to deliver the 18- storey development in Dubai Science Park by December 2020. The value of the contract was not disclosed. Bella Rose will offer studios, one- and two-bedroom apartments, with prices starting at Dhs449,777. Deyaar will also offer buyers a six-year monthly payment plan starting from Dhs3,750 per month. The residential tower features an infinity pool, gym, parking for residents and visitors, and 24-hour security, as well as retail stores on the ground level and landscaped gardens. Deyaar did not announce the total cost of the project. The company, which reported a 2.6 per cent decline in net profit to Dhs65.m in the first half of the year, was linked to a potential merger with Union Properties last week. The two firms were previously said to be close to combining in 2009 before the plans were halted by the financial crisis. However, Union denied it was considering a merger on Monday. (Gulf business)

Saudi Arabia Al Rajhi REIT Fund has signed on Monday a SAR 500 million shariah-compliant financing facility agreement with Al Rajhi Bank. The amount, which is covered by a promissory note and a property mortgage, will be withdrawn until June 30, 2019. The Loan will be used to fund the acquisition of various income generating real estate assets by the REIT in line with its strategy. During the tenure of the facility, interest will be serviced on a quarterly basis in arrears with a bullet principal repayment at the end of the contractual period after seven years. (Argaam)

Saudi Arabia's top dairy producer Almarai Co.'s board of directors have approved the establishment of a risk committee to strengthen its governance. Bader bin Abdullah Al Issa, a non-executive member of the board, has been named the chairman of the risk committee. He will be assisted in his task by Vanessa Eastham Fisk and Jason Day. The designation of the risk committee is effective from the date of the board resolution. (Argaam)

Flynas expects to increase its fleet to 80 aircraft over the coming years, from 30 currently. Flynas, which operates direct flights to 22 international airports, has added more aircraft and opened new routes over the past two years in response to growing demand. The Saudi aviation sector saw an average growth of 8 percent over the past five years, compared to the global average of 4 percent. The Kingdom is expected to maintain this growth over the next five years as well, especially with the country’s economic reforms, and plans to boost religious tourism. Saudi Arabia, which is the region’s largest aviation market, aims to increase Hajj and Umrah visitors to 15 million by 2020 from the current 8 million visitors. Accordingly, Flynas has leased two wide-body aircraft in order to meet demand from religious tourism. In terms of favored destinations for Saudi travelers, Egypt, UAE, Turkey and the Gulf countries retain the top spots, followed by Pakistan and India. Commenting on the carrier’s growth plans, he noted that Flynas is seeking to increase its market share as a national carrier, against other dominant international airlines. The airline has entered new markets this year, such as Algeria, Nigeria and Pakistan. Flynas has also signed an agreement to acquire 120 Airbus A320 aeroplanes with a capacity of 174 passengers each, in order to compete in a fierce market that has a state-backed airline. (Argaam)

Al Jouf Cement Co. on Sept. 30 shipped its first export cargo to Yemen, sending out 9,000 tons of cement after completing the required procedures. (Argaam)

Saudi Research and Marketing Group launched “Almall”, a new e-commerce app that serves as a platform for both top international and local brands to sell their products. (Argaam)

Alinma-Al Akaria Fund for Real Estate Development will develop a 10,000 square meter mixed-use project to serve the business sector. (Argaam)

An official at Saudi Arabia's Public Investment Fund said on Monday that a Wall Street Journal report that it had shelved a $200 billion plan with SoftBank Group Corp to build the world's biggest solar-power-generation project was "incorrect." PIF "continues to work with the SoftBank Vision Fund and other institutions on a number of large-scale, multi-billion-dollar solar projects which will be announced at the appropriate time." (Zawya)

State oil giant Saudi Aramco will bring new crude output capacity of some 550,000 barrels per day (bpd) online in the fourth quarter from two fields, Khurais and Manifa, giving it the ability to boost production if there is demand. The expansion of crude output capacity from Khurais field, which produces light sour crude, will add around 250,000-300,000 barrels per day boosting the field potential to 1.5 million bpd. The resumption of production from the giant Manifa field, which pumps heavy sour oil, after resolving some maintenance issues will add another 300,000 bpd to Aramco's crude output capacity. (Zawya)

Kuwait GFH Financial Group would like to inform its shareholders and the markets that it has signed to acquire circa US$200 million of Villamar Sukuk Company Limited, Sharia Compliant Sukuk Certificates, from Al Rajhi Bank. It is to be noted that the Sukuk were issued in 2008 to finance the iconic Villamar project in the Kingdom of Bahrain . The acquisition is expected to reflect positively on GFH’s financials during the second half of 2018, due to the agreed discount for this transaction. (Boursa Kuwait)

Mr. Mahmoud Mohamed Ezzat Moursi has been appointed as Group Chief Legal Counsel for Burgan Bank starting from 1St October 2018. (Boursa Kuwait)

KIB recently appointed Raed Jawad Bukhamseen as Vice Chairman and Chief Executive Officer of the Bank, after obtaining the necessary approvals from the Central Bank of Kuwait. A longtime member of the KIB leadership team, Bukhamseen has served as Vice Chairman of the Bank since 2015 and has also been a member of the Bank’s Board of Directors since 2010. (Zawya)

United Securities LLC, P.O. Box 2566, Postal Code – 112, Ruwi, Sultanate of Oman Tel: +968 24763300, Fax: +968 24788671, Website: http://www.usoman.com, Email: [email protected]

MENA Morning Note Tuesday, October 02, 2018

Aston Martin has cut the upper end of its initial public offering price range to 20 pounds per share, giving it a potential market value of up to 4.6 billion pounds, following mixed feedback from investors. Aston Martin had initially set a range of 17.50 pounds to 22.50 pounds per share, but said on it Monday it had narrowed this to 18.50 pounds to 20 pounds and that it had enough bid interest to cover all the shares being sold at this level. Aston Martin, famed for making the sports car driven by fictional secret agent James Bond, said it expected to close the IPO books at midday London time on Tuesday. Bankers say that IPOs generally need twice as many bids as shares on offer to be successful. Several multi-billion European IPOs got off to a cautious start last week when crowd-lending platform Funding Circle traded down on its debut while Swiss packaging company SIG Combibloc booked gains. On Monday, German brake systems maker Knorr-Bremse also said it had attracted bids for all shares on offer in its initial public offering planned for later this month. Based on around 57 million shares being sold, a free float of 25 percent, the listing would give the company a market capitalization of up to around 4.6 billion pounds. Depending on where it prices within the range, Aston Martin may just make it into the FTSE 100 after its flotation and will be the first car maker in the blue-chip index since Jaguar. The company is selling around 25 percent of its stock in the first IPO by a British carmaker for decades. The flotation follows a sale of shares by its main owners, Kuwaiti and Italian private equity groups. (Reuters)

Qatar Ooredoo announces its intent to disclose the 3rd quarter financial statements for the period ending September 30 2018 on Monday 29 October 2018. (Qatar Stock Exchange)

Qatar Airways said on Monday it was upgrading five of its Airbus A350 jets on order to the largest model, in a boost for the European planemaker’s largest twin-engined jet. The Gulf airline was the launch customer for both A350 models and said in February it could switch some of its existing order of A350-900s to the bigger A350-1000. State-owned Qatar Airways has upgraded the order amid a political dispute in the Arab region that has forced the airline to increase operational costs by flying longer routes. The upgraded order will come as a relief to Airbus, which is betting on the A350-1000 to contain any market pressure from rival Boeing which is developing its new model 777 twin-engined jet. The A350-1000 is designed to seat 366 people and competes head-to-head with Boeing’s profitable 777. Airbus says the lightweight A350-1000 is 25 percent more efficient than the most popular current version of the 777, the 777-300ER. (Reuters)

Bahrain Al Baraka Banking Group has launched a digital banking service in Germany with plans to offer its interest-free financial services across Europe. The lender, which has operations in the Middle East, Asia and Africa, launched its branch-free "insha" service through its Turkish subsidiary Albaraka Turk. The digital banking service would be the main strategy for penetrating the European market, including an estimated 20 million Muslims living in the continent. The digital bank will initially offer basics such as bank account management, online payments and money transfers, with plans to include a wider range of Islamic banking services at a later stage. Islamic finance follows religious principles, such as a ban on interest and speculation, with the industry's core centres in the Middle East and Southeast Asia. Turkish lender Kuveyt Turk launched Germany's first full- fledged Islamic bank in 2015, but Islamic finance has been slow to gain a foothold in mainland Europe due to a fragmented market and lack of industry-specific regulations. Britain remains Europe's main Islamic finance hub, with Luxembourg and Ireland also hosting Islamic bonds and Islamic investment funds respectively. (Zawya)

United Securities LLC, P.O. Box 2566, Postal Code – 112, Ruwi, Sultanate of Oman Tel: +968 24763300, Fax: +968 24788671, Website: http://www.usoman.com, Email: [email protected]