UAE bank to open branches in Saudi Arabia

FAB, the UAE’s largest lender, will open up to three branches in the Kingdom as part of its expansion strategy. (REUTERS)
Updated 22 March 2018
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UAE bank to open branches in Saudi Arabia

LONDON: First Abu Dhabi Bank (FAB), the UAE’s largest lender, is poised to establish a commercial banking business in the Kingdom after being granted a license by the Saudi Arabia Monetary Authority (SAMA).
FAB will be able to open up to three branches as part of its expansion strategy that recently saw Riyadh’s Capital Market Authority (CMA) give it permission to establish an investment banking subsidiary.
The Abu Dhabi bank joins Western financial institutions that have shown an interest in operating in KSA as the economy opens in line with the Vision 2030 modernization and reform program.
Citibank, for example, started up in Jeddah in April 2017 after a gap of 13 years, making it the first American bank to put down roots in the Kingdom in more than a decade. Citi won a license to take part in mergers and acquisitions, initial public offerings, privatizations, and other capital markets business.
Goldman Sachs, which has been operating in the Kingdom since 2009 as an agent and underwriter last June won CMA approval for a license to trade equities.
Commenting on the FAB license, Tahnoon Bin Zayed Al-Nahyan, chairman of FAB, said: “In light of the recent securities license approval secured earlier this year, FAB is moving forward with the next phase of our growth plan for the KSA market.
“By providing new opportunities for customers in the region to grow stronger, this new addition to the banking landscape will be another catalyst for the continued advancement of the KSA economic agenda, and will further reinforce the UAE and Saudi Arabia’s solid relationship.”
CEO Abdulhamid Saeed said: “These developments give us the platform to tap into the region’s largest economy with the full strength and capabilities of the FAB offering, and build on the strong potential of the KSA market. We are confident that our expansion into Saudi Arabia will enhance our regional presence and will provide an important contribution to our international network.”
Headquartered in Abu Dhabi’s Khalifa Business Park, FAB’s international network spans over 19 countries outside the UAE.
Based on audited financial information as at December-end 2017, FAB had total assets of $182 billion.
Recent reports by Bloomberg have suggested that Citi, Goldman Sachs, Morgan Stanley and HSBC have been appointed to advise on Saudi Arabia’s global borrowing program. This involves the refinancing and extension of the $10 billion loan from two years ago, and a new bond which could rival the record-breaking $17.5 billion issue of 2017.
The Saudi stock exchange opened itself to direct investment by foreign institutions in mid-2015 and last year eased restrictions on foreign ownership in its stock market to improve the investment environment.
International firms such as BlackRock, Citigroup, HSBC and Ashmore Group have since been among those to join the list of institutional investors that can directly trade the market.


Libya’s National Oil against paying ‘ransom’ to reopen El Sharara field

Updated 14 December 2018
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Libya’s National Oil against paying ‘ransom’ to reopen El Sharara field

  • Ransom payment would set dangerous precedent
  • NOC declared force majeure on exports on Monday

BENGHAZI: Libya’s state-owned National Oil Corp. (NOC) said it was against paying a ransom to an armed group that has halted crude production at the country’s largest oilfield.
“Any attempt to pay a ransom to the armed militia which shut down El Sharara (oilfield) would set a dangerous precedent that would threaten the recovery of the Libyan economy,” NOC Chairman Mustafa Sanalla said in a statement on the company’s website.
NOC on Monday declared force majeure on exports from the 315,000-barrels-per-day oilfield after it was seized at the weekend by a local militia group.
The nearby El-Feel oilfield, which uses the same power supply as El Sharara, was still producing normally, a spokesman for NOC said, without giving an output figure. The field usually pumps around 70,000 bpd.
Since 2013 Libya has faced a wave of blockages of oilfields and export terminals by armed groups and civilians trying to press the country’s weak state into concessions.
Officials have tended to end such action by paying off protesters who demand to be added to the public payroll.
At El Sharara, in southern Libya, a mix of state-paid guards, civilians and tribesmen have occupied the field, camping there since Saturday, protesters and oil workers said. The protesters work in shifts, with some going home at night.
NOC has evacuated some staff by plane, engineers at the oilfield said. A number of sub-stations away from the main field have been vacated and equipment removed.
The occupiers are divided, with members of the Petroleum Facilities Guard (PFG) indicating they would end the blockade in return for a quick cash payment, oil workers say. The PFG has demanded more men be added to the public payroll.
The tribesmen have asked for long-term development funds, which might take time.
Libya is run by two competing, weak governments. Armed groups, tribesmen and normal Libyans tend to vent their anger about high inflation and a lack of infrastructure on the NOC, which they see as a cash cow booking billions of dollars in oil and gas revenues annually.