Interpreting Middle East Economic News and Analyzing Market Trends

Category: Banks

Dubai World urged to sell more assets to pay creditors

Dubai World, the Dubai government’s prized possession, is not out of the woods yet.  The company which owns DP World, the global ports operator, renegotiated debts and set a new repayment schedule in 2011 after the company ran into liquidity issues.  The company has an upcoming payment of $4.5 billion, which is not due for another two years.  However, some of its creditors are getting nervous at the speed the company is moving at selling assets to be able to meet this payment on time.

 

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Cyprus Update: Capital controls still in place, economy sinking with no end in sight

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It’s been one month since Cyprus reached a deal with the EU, ECB and IMF (collectively known as the Troika).  The bail out was supposed to save the country from a collapse of its financial system and help build up the economy again.  Instead, the bailout/bail-in is a disaster and the country is nearly forgotten as the Troika moves on to prepare for the next bailout victim.

 

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HSBC mulls Iraq exit as management continues to flip-flop on its strategy

HSBC Bank, which took a hit on its earnings last year to settle allegations of money-laundering in the US, is still trying to stay focused after several poor decisions made over the past decade.  See our earlier posts here and here for details.  Management’s latest strategy move is trying to determine whether or not to stay in Iraq.

  

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Bailouts of bad debts do more harm than good

Kuwait’s dysfunctional parliament recently approved bailouts of bad consumer loans dating back as early as 2002.  The UAE and Saudi Arabia have both came up with similar solutions to bailout their citizens of their piles of bad debts, but is this good?  Who really benefits from bailouts and what is likely to happen down the road?  We’ve reported on this topic several times over the past few months, here, here, here and here.  Now it seems that a major ratings agency has come out against these bailouts due to their longer term effects on the economy.

 

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Mashreq Bank sues ING over $43 million derivatives loss

The fallout from derivative losses continues…

 

ING Groep NV, the largest Dutch financial-services company, was sued in the U.S. by Dubai’s Mashreq Bank PSC (MASQ) over a $43 million investment loss tied to derivative securities.

Mashreq said in a complaint filed yesterday in Manhattan federal court that it invested conservatively with ING in 2005 and that in 2007 ING wrongly revised the investments to include collateralized debt obligations and other risky instruments.

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