JPMorgan to add bankers in Saudi Arabia to reflect market growth

View shows the King Abdullah Financial District, north of Riyadh, Saudi Arabia, March 1, 2017. (REUTERS)
Updated 11 May 2017

JPMorgan to add bankers in Saudi Arabia to reflect market growth

DUBAI: JPMorgan will increase the number of bankers it has in Saudi Arabia to around 80 by the end of the year to capitalize on the increase in equity market activity and mergers and acquisitions in the kingdom, a senior executive said.
Saudi Arabia has unveiled about $200 billion of privatization of state-owned companies over the next few years, selling stakes in everything from hospitals to airports. The kingdom is also listing oil company Saudi Aramco, which it expects will raise another $100 billion.
“We’re invested in investment banking and our equities brokerage capabilities as we expect more activity in the equity market with all the changes that are going on,” Sjoerd Leenart, head of JPMorgan’s Middle East and North Africa (MENA) region, told Reuters on Thursday.
“We have about 70 people now and will go to around 80 at year end.”
Leenart said the bank can also also draw on expertise from outside the region.
“There’s a very important balance to maintain between having expertise on the ground and drawing on industry expertise sitting in the US or UK,” he said.
JPMorgan, which sources have told Reuters has been appointed as a financial adviser to help in the listing of Aramco, has been in kingdom for more than 80 years.
JPMorgan has declined to comment on its advisory role.
“From 2018 onwards, we expect a busy agenda in terms of IPO listings and trade sales to strategic and financial buyers,” Leenart said.
The bank has had an active year so far in 2017, advising on M&A transactions and the sale of the sovereign’s $9 billion sukuk.
Credit Agricole picked it to advise it on a potential sale of the French bank’s 31 percent stake in Banque Saudi Fransi, valued at nearly $2.4 billion, sources told Reuters on March 8.
JPMorgan is also advising Riyadh-based ACWA Power on a move by Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), to buy a stake, sources close to the matter told Reuters in November.
Leenart said the firm is also investing in its Saudi custody business, but did not give specific details.


New emissions blow for VW as German court backs damages claims

Updated 26 May 2020

New emissions blow for VW as German court backs damages claims

  • Scandal has already cost firm more than €30 billion; ruling serves as template for about 60,000 cases

KARLSRUHE, Germany: Volkswagen must pay compensation to owners of vehicles with rigged diesel engines in Germany, a court ruled on Monday, dealing a fresh blow to the automaker almost 5 years after its emissions scandal erupted.

The ruling by Germany’s highest court for civil disputes, which will allow owners to return vehicles for a partial refund of the purchase price, serves as a template for about 60,000 lawsuits that are still pending with lower German courts.

Volkswagen admitted in September 2015 to cheating in emissions tests on diesel engines, a scandal which has already cost it more than €30 billion ($33 billion) in regulatory fines and vehicle refits, mostly in the US.

US authorities banned the affected cars after the cheat software was discovered, triggering claims for compensation.

But in Europe vehicles remained on the roads, leading Volkswagen to argue compensation claims there were without merit. European authorities instead forced the company to update its engine control software and fined it for fraud and administrative lapses.

Volkswagen said on Monday it would work urgently with motorists on an agreement that would see them hold on to the vehicles for a one-off compensation payment.

It did not give an estimate of how much the ruling by the German federal court, the Bundesgerichtshof (BGH), might cost it.

Volkswagen shares were 0.5 percent lower. The BGH’s presiding judge had signaled earlier this month he saw grounds for compensation.

Costs mount

“The verdict by the BGH draws a final line. It creates clarity on the BGH’s views on the underlying questions in the diesel proceedings for most of the 60,000 cases still pending,” Volkswagen said.

A lower court in the city of Koblenz had previously ruled the owner of a VW Sharan minivan had suffered pre-meditated damage, entitling him to reimbursement minus a discount for the mileage the motorist had already
benefited from.

The court at the time said he should be awarded €25,600 for the used-car purchase he made for €31,500 in 2014.

“We have in principle confirmed the verdict from the Koblenz upper regional court,” said BGH presiding federal judge Stephan Seiters.

Volkswagen had petitioned for the ruling to be quashed altogether by the higher court, while the plaintiff had appealed to have the deduction removed.

A Volkswagen spokesman said that outside Germany, more than 100,000 claims for damages were still pending, of which 90,000 cases were in Britain.

The carmaker also said it had paid out a total of €750 million to more than 200,000 separate claimants in Germany who had opted against individual claims and instead joined a class action lawsuit brought by a German consumer group.

The carmaker said last month it would set aside a total of 830 million for that deal.

In a separate court, Volkswagen agreed last week to pay €9 million to end proceedings against its chairman and chief executive, who were accused of withholding market-moving information before the emissions scandal came to light.