In this latest issue you will find reports on the impact of the global downturn on Arab Financial markets. There is also coverage of the progress of the establishment of the Gulf Mega Bank which is in its final stage.

For the most recent updates on our activities please access our website: http://www.arabfinancialforum.org/. Please let us know if you have any particular news items that you would like to have printed in the next newsletter. I hope you enjoy this newsletter.

All the best,

Maya Rusinowicz

Editor - projects@meconsult.co.uk

Arab Financial Forum

http://www.arabfinancialforum.org

Upcoming Events:

Launch event of AFF study on Sovereign Wealth Funds - London

The event will be kindly hosted at the Bahrain Embassy by HE Sheikh Khalifa Bin Ali Al Khalifa on 6th May 2009 at 4pm. Please contact AFF Secretariat for more information.

European Forum on Islamic Finance - Milan

ASSAIF, an Italian company which specialises in Islamic Finance would like to invite all AFF subscribers to a Forum on Islamic Finance, which will be held in Milan on 12th and 13th May. To download the programme of the Forum, please visit www.assaif.org or email taneena@financial-events.ch

Articles:

Islamic Banks take share of the pain.

Islamic prohibitions against fixed interest and most complicated financial instruments have helped Islamic banks avoid the avalanche of derivative debt losses that have wreaked havoc across the world financial system.

Devout Muslim investors have also fared better when buying global equities that do not violate Islamic principles. Sharia screening has shielded them from exposure to over-leveraged corporates, conventional banks, gaming companies and sellers of alcohol such as hotel groups, all of which have suffered from precipitous drops in value.

(29 April 2009) Read more�

Gulf must learn lessons from crisis

At the recent G20 summit, leaders of the world�s leading economies committed themselves to a wide-ranging and specific set of actions aimed at shortening the global economic crisis and strengthening international financial regulation.

We have yet to see an equivalent Arab response to the crisis; still less, a set of recommendations for what Arab financial markets can learn from the turmoil in the West.

(29 April 2009) Read more�

Ahli Bank Q1 net income climbs 15%

Oman’s Ahli Bank reported a net profit of RO1.41 million for the first quarter of this year, which is ’marginally lower’ than its profit in the corresponding period of 2008. The bank’s net operating income for the first quarter grew by 15% to RO3.42 million as compared to RO2.97 million for the corresponding period last year, while customer deposit grew by 80% to RO322 million. The bank’s operating expenses have increased by 44% to RO1.76 million.

(28 April 2009) Read more�

Qatar pledges $150 billion aid for firms

Qatar has set aside about $150 billion for various projects over the next four years and stands ready to inject funds into local companies hit by the global economic meltdown. The Qatar Investment Authority had previously stepped in to support troubled banks by buying between 10 and 20 per cent stakes of the institutions.

(27 April 2009) Read more�

National Bank of Oman and NBCI team up to share credit data

Kuwaiti News Agency KUNA reports that the law to achieve financial stability in the country is a precautionary measure to deal with the international economic meltdown. The entire law reflects an objective assessment of the nature of challenges confronting the local financial and banking sector in particular and the national economy in general.

(27 April 2009) Read more�

Several foreign banks willing to open branched in Iran

Several foreign banks have applied for opening branches in Iran. Addressing a local seminar, the Vice President Davoudi said that the move of the capitalist governments, which once claimed to resolve all world economic problems, derives from being trapped in deep economic crisis.

(26 April 2009) Read more�

Mega-Bank on the way

Gulf Investors are launching a new $10 billion Islamic bank and plan a $3 billion initial public offering in the fourth quarter (Q4) to tap interest in Sharia-compliant institutions. The new bank was in the �final stages� of establishing its founding shareholders and would be formed by the end of this year.

(25 April 2009) Read more�

Profit Blow for NBK

National Bank of Kuwait has posted a 22.6 per cent decline in first-quarter net profits, after booking provisions to weather the global financial crisis. The country�s biggest bank by assets posted net profits of $216.9 million in the first quarter, NBK said in a statement on the bourse website. This compares with $280 million in Q1 of last year.

(25 April 2009) Read more�

Dividend boost for investors unlikely to last

In addition to enjoying a recent rally in most regional markets, Gulf investors are receiving another welcome boost: dividend payments for 2008.

The steep rise in the dividend yield last year is a product of both precipitous share price declines and bumper earnings for the first three quarters of the year. Analysts and money managers warn that shareholders will have to pare down drastically their dividend expectations for this year

(22 April 2009) Read more�

Dubai raises $635 million to refinance debt

The Dubai government raised a $635m Islamic loan to help retire $1bn in civil aviation authority debt maturing later this month.

The loan should help assuage international investor concerns about the Gulf commercial hub�s ability to attract bank funding as it looks to refinance around $15bn this year, part of the emirate�s $75bn-$80bn debt pile.

(5 April 2009) Read more�

Saudi Arabia will play part in recovery

As the world�s leaders meet in London to seek ideas and funds in order to prevent a systemic collapse of the global economy, many eyes have turned to Saudi Arabia as an obvious source of cash.

The kingdom�s contribution to rescuing the global financial system has been far from negligible. It is investing more than $70bn to bring its oil production capacity to 12.5m barrels a day by the end of this year.

(1 April 2009) Read more�

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