APICORP sukuk program given expected AA rating by Fitch

APICORP sukuk program given expected AA rating by Fitch
APICORP helps Arab companies develop their energy sectors. (Reuters)
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Updated 24 September 2021

APICORP sukuk program given expected AA rating by Fitch

APICORP sukuk program given expected AA rating by Fitch
  • A default in APICORP's sukuk program would be considered a default in the parent, Fitch said

RIYADH: APICORP, the multilateral development bank set up by Arab oil producers, has received a rating of AA(EXP) by Fitch for its sukuk program.

APICORP Sukuk Ltd. (ASL) is incorporated in the Cayman Islands with the sole purpose of issuing Islamic debt. The final rating is contingent on Fitch receiving documents that support information already provided.

ASL is expected to receive the same AA rating as APICORP as a default in the sukuk program would be considered a default in the parent, Fitch said. APICORP’s rating is based on Fitch’s solvency and liquidity assessment and a “medium risk” business environment.

APICORP was established in 1975 by the 10 members of the Organization of Arab Petroleum Exporting Countries (OAPEC) with the aim of developing the Arab world’s energy sector through equity investment, debt financing, financial advisory and energy research services.


US regulators slap $41m fine on company behind Tether ‘token’

US regulators slap $41m fine on company behind Tether ‘token’
Updated 16 October 2021

US regulators slap $41m fine on company behind Tether ‘token’

US regulators slap $41m fine on company behind Tether ‘token’

NEW YORK:The company behind a digital token called Tether has agreed to pay $41 million to settle charges that it misled investors by claiming the token was fully backed at all times by US dollars and other fiat currencies.

The Commodity Futures Trading Commission said on Friday it charged Tether Holdings Limited with making untrue or misleading statements and omissions in relation to its claims. Specifically, the US regulator found that since launching the token in 2014, Tether Holdings represented that its was a “stablecoin” with its value pegged to fiat currency, including US dollars and euros.

A stablecoin is a digital currency backed by real-world assets such as national currencies or other commodities. Unlike Bitcoin and other cryptocurrencies, stablecoins are designed to not fluctuate wildly in value.

However, the CFTC determined that at least from June 1, 2016 through Feb. 25, 2019, Tether misrepresented to customers and the market that it maintained sufficient US dollar reserves to back every Tether token in circulation with the equivalent amount of “corresponding fiat currency.”

The agency also found that Tether failed to disclose that it included unsecured receivables and non-fiat assets in its reserves, and that the company falsely represented it would undergo regular audits to prove it was maintaining the fiat currency reserves it needed to back Tether tokens.

In a statement, Tether, which is headquartered Hong Kong and maintains an office in Santa Monica, California, said the CFTC’s findings pertained to certain disclosures about the company’s reserves that were “fully resolved” in February 2019, when the company updated its terms of service.

“As to the Tether reserves, there is no finding that Tether tokens were not fully backed at all times — simply that the reserves were not all in cash and all in a bank account titled in Tether’s name, at all times,” the company said, noting that it has “always maintained adequate reserves and has never failed to satisfy a redemption request.”

Separately, the CFTC also ordered Bitfinex to pay a $1.5 million civil penalty after finding that the cryptocurrency trading platform made illegal, off-exchange retail commodity transactions involving digital assets with US investors and operated as a futures commission merchant without registering to do so.


$590m in ransomware payments reported to US in 2021 as attacks surge

$590m in ransomware payments reported to US in 2021 as attacks surge
Updated 16 October 2021

$590m in ransomware payments reported to US in 2021 as attacks surge

$590m in ransomware payments reported to US in 2021 as attacks surge

WASHINGTON: New data out Friday showed $590 million in ransomware-related payments were reported to US authorities in the first half of 2021 alone, setting a pace to beat totals for the whole previous decade as cyber-extortion booms.

The figure is also 42 percent higher than the amount divulged by financial institutions for all of 2020, the US Treasury report said, and there are strong indicators the true cost could be in the billions.

“If current trends continue, (reports) filed in 2021 are projected to have a higher ransomware-related transaction value than ... filed in the previous 10 years combined,” said Treasury’s Financial Crimes Enforcement Network.

The heists involve breaking into a company or institution’s network to encrypt its data, then demanding a ransom, typically paid via cryptocurrency in exchange for the digital key to unlock it.

Washington has sought to crack down on a sharp rise in attacks, including issuing its first sanctions against an online exchange where illicit operators have allegedly swapped cryptocurrency for cash.

Recent assaults on a major US oil pipeline, a meatpacking company and the Microsoft Exchange email system drew attention to the vulnerability of US infrastructure to digital pirates who are extorting staggering sums.

Treasury said investigators found over 150 online wallets for cyptocurrency and by analyzing them uncovered roughly $5.2 billion in transactions potentially tied to ransomware payments.

Companies and institutions face intense pressure to pay up in order to get their data unlocked, but also to keep the attack from potentially angry clients and authorities who issue stern warnings not to give cash to criminals.

The report, based on the suspicious activity alerts that financial firms have to file, noted it was unclear if the jump represented increased awareness of the cybercrime.

“This trend potentially reflects the increasing overall prevalence of ransomware-related incidents as well as improved detection and reporting,” Treasury said.


Saudi Commerce Ministry issues 31 licenses for steel, cement export

Saudi Commerce Ministry issues 31 licenses for steel, cement export
Updated 16 October 2021

Saudi Commerce Ministry issues 31 licenses for steel, cement export

Saudi Commerce Ministry issues 31 licenses for steel, cement export

RIYADH: Saudi Arabia’s Commerce Ministry has issued 31 licenses to export steel and cement since the beginning of 2021, Al-Eqtisadiah reported on Saturday.

According to the report, 11 licenses were issued for cement export and 20 to export steel. 

The new licenses come as construction activity begins to recover following the postponement of many projects during the coronavirus (COVID-19) pandemic.


Bitcoin trades near record after topping $60,000 for first time in 6 months

Bitcoin trades near record after topping $60,000 for first time in 6 months
Updated 16 October 2021

Bitcoin trades near record after topping $60,000 for first time in 6 months

Bitcoin trades near record after topping $60,000 for first time in 6 months

Bitcoin topped $60,000 for the first time in six months on Friday, nearing its all-time high, as hopes grew that U.S. regulators would allow a futures-based exchange-traded fund (ETF), a move likely to open the path to wider investment in digital assets.

Cryptocurrency investors have been waiting for approval of the first U.S. ETF for bitcoin, with bets on such a move fuelling its recent rally.

The world's biggest cryptocurrency rose to $61,869.05, its highest since mid-April, at 10:30am Riyadh time. It has risen by more than half since Sept. 20 and is closing in on its record high of $64,895 hit in April.

The U.S. Securities and Exchange Commission (SEC) is set to allow the first American bitcoin futures ETF to begin trading next week, Bloomberg News reported on Thursday. Such a move would open a new path for investors to gain exposure to the emerging asset, according to traders and analysts.

"Crypto ETFs are inevitable. A product like this will eventually come to fruition since there is a demand for it," said Chris Kline, chief operating officer and co-founder of Bitcoin IRA.

"It seems clear that regulators will approve some version of a crypto ETF soon, most likely by Monday," Kline added. "As regulators become more familiar with the space, the SEC is starting to understand how these assets are stored, secured and reconciled so that it makes sense in traditional finance."

Bitcoin's moves on Friday were spurred by a Twitter post from the SEC's investor education office urging investors to weigh risks and benefits of investing in funds that hold bitcoin futures contracts, said Ben Caselin of Asia-based crypto exchange AAX.

Several fund managers, including the VanEck Bitcoin Trust, ProShares, Invesco, Valkyrie and Galaxy Digital Funds, have applied to launch bitcoin ETFs in the United States.

The Nasdaq on Friday approved the listing of the Valkyrie Bitcoin Strategy ETF.

After months of back-and-forth between the SEC and potential bitcoin futures ETF issuers, the regulator appears prepared to greenlight a handful of filings that will open the door to wider access to cryptocurrencies to retail and institutional investors alike.

Under the rule sets used by the ETF issuers, the SEC does not have to give explicit approval to the ETFs, which can be launched at the end of a 75-day period if the U.S. regulator has no objections.

The 75-day time period for the ProShares Bitcoin Strategy ETF ends on Monday, and the ETF can be launched on Tuesday.

The SEC declined to comment.

Crypto ETFs have launched this year in Canada and Europe, growing in popularity amid surging interest in digital assets.

Futures exchange operator Cboe Global Markets Inc applied for a rule change with the SEC that would allow it to list certain complex ETFs. The SEC approved that application on Oct. 1.

SEC Chair Gary Gensler has previously said the crypto market involves many tokens that may be unregistered securities and leaves prices open to manipulation and millions of investors vulnerable to risks.

Citing people familiar with the matter, the Bloomberg report said proposals by ProShares and Invesco, based on futures contracts, were filed under mutual fund rules that Gensler has said provide "significant investor protections".

"It's one of the final frontiers for mandate access," said Joseph Edwards, head of research at crypto broker Enigma Securities. "Plenty of Americans in particular have strings attached to how they deploy a lot of their wealth. It allows bitcoin to get in on the sorts of windfall that keep U.S. equities as consistently strong as they are."


After Alitalia’s demise, ITA airline launches with new look

After Alitalia’s demise, ITA airline launches with new look
Updated 15 October 2021

After Alitalia’s demise, ITA airline launches with new look

After Alitalia’s demise, ITA airline launches with new look
  • ITA, or Italy Air Transport, officially launched after bankrupt flag carrier Alitalia landed its final flights Thursday night
  • Protests and strikes accompanied the runup to Alitalia's formal demise because the much smaller ITA Airways

ROME: Italy’s new national airline, ITA Airways, flew its inaugural flights Friday and unveiled its brand and logo, recycling the red, white and green of its Alitalia origins. It tries to chart a new future while competing with low-cost airlines.
ITA, or Italy Air Transport, officially launched after bankrupt flag carrier Alitalia landed its final flights Thursday night, ending a 74-year business history that a series of financial crises had marred in recent years.
Protests and strikes accompanied the run-up to Alitalia’s formal demise because the much smaller ITA Airways is only hiring around a quarter of Alitalia’s more than 10,000 employees. Negotiations with unions are ongoing.
ITA paid 90 million euros (over $104 million) for the rights to the Alitalia brand and website, but the new airline is called ITA Airways and it has its own website and a new frequent flier program, called “Volare” (“Fly”).
“Discontinuity doesn’t mean denying the past, but evolving to keep up with the times,” ITA President Alfredo Altavilla said in a statement.
During a conference launching the airline, Altavilla insisted that the greatly reduced size of ITA — its slimmer fleet, workforce and destinations — make it a viable carrier that can compete with low-cost airlines while offering better service, connections and value.
“ITA Airways is being born right-sized, in the optimal dimensions both in terms of the size of its fleet and its destinations,” he said. “We don’t carry with us the negative inheritance of being too big that conflict with the economic reality.”
He bristled when asked about reported predictions by low-cost carriers of ITA Airways’ failure.
“They might be very, absolutely right that this is gonna be difficult for us, but I am really curious to see one day their PnL (Profits and Loss) and their balance sheet without all the subsidies that they are getting from the local institutions and the small airports here in Italy,” Altavilla said.
“I want a level playing field,” he added.
The first ITA flight was the 6:20 a.m. from Milan’s Linate airport to the Italian city of Bari, on the Adriatic Sea. In all, ITA is flying to 44 destinations and aims to increase that number to 74 in four years.
Among its routes, the company plans to operate flights to New York from Milan and Rome, and to Tokyo, Boston and Miami from Rome. European destinations from Rome and Milan’s Linate airport will also include Paris, London, Amsterdam, Brussels, Geneva and Frankfurt, Germany. Routes to South America and Los Angeles are planned.
ITA planes will be royal blue with Alitalia’s trademark “tricolore” on the tail, reflecting the red, white and green of the Italian flag. The Italian national sports team colors are blue, and company officials said Friday that the color scheme chosen for the new aircraft aims to make ITA “azzurri,” — the team nickname — too.
For now, the new blue Airbus aircraft exists only in advertisements, with Alitalia’s old white fleet actually in the skies.
Officials were coy about possible partnerships with other airlines. Previously, Alitalia was a member of the SkyTeam alliance, which included Delta, Air France and KLM, among other airlines.
ITA has 52 planes that it says will grow to 105 in the same period and is pointing to next-generation aircraft that use sustainable, alternative fuel sources.
The company launched with 2,800 employees — 70 percent of them from Alitalia — and said it expects to increase the size of its workforce to 5,750 by 2025.