JEDDAH, 17 June 2007 — SABB Takaful shares jumped 497.50 percent on debut on Tadawul yesterday but that failed to halt the slide in Saudi stock market as the Tadawul All-Share Index (TASI) plunged to its lowest close in more than two years. The stock index tumbled below 7,000 points, closing at 212.71 points or 3.01 percent down at 6,861.80 yesterday. The index is down 13.51 percent so far this year.
The SR10 SABB Takaful shares opened at SR82 before reaching as high as SR96.25 and low of SR56 before settling at SR59.75.
SABB Takaful is a public joint stock company incorporated in Saudi Arabia with a start-up capital of SR100 million. It is 32.5 percent owned by SABB and 32.5 percent owned by subsidiaries of the HSBC Group. SABB Takaful’s 35 million initial public offering (IPO) of 35 percent of the firm attracted SR247.2 million worth of bids.
SABB Takaful will offer a comprehensive range of Shariah-compliant Takaful products for both personal and corporate customers. These will include savings and protection products to meet individual needs for financial planning and business solutions for business risks.
Shares of other insurance companies, however, performed very badly yesterday. The National Company for Cooperative Insurance (NCCI) shares dropped 4.49 percent to SR95.75, Malath Insurance by 10 percent to SR29.25 and the Mediterranean & Gulf Insurance & Reinsurance Co. by 9.35 percent to SR24.25.
Out of 89 stocks traded, only two were in positive territory. The other gainer yesterday was Yanbu Cement as its shares rose 1.15 percent to SR66.25.
Over SR4.39 billion worth of shares changed hands yesterday.
The banking index fell 3.56 percent yesterday as shares of major banks such as Al-Rajhi Bank dropped 4.95 percent to SR72 and Samba Financial Group by 4.39 percent to SR119.75.
Shares of Saudi Basic Industries Corp. (SABIC) declined 2.40 percent to SR111.75 yesterday.
Meanwhile, the Saudi stock market (Tadawul) conducted an experimental operation of the new Tadawul system on Thursday and Friday to make sure that banks, financial intermediaries and other licensed members are ready to shift to the new system, according to Abdullah Al-Suwailemi, acting director general of Tadawul. “The tests and experiments were completed as planned and the results were positive,” he said.
Suwailemi said the experimental operation was carried out without facing any technical problems by banks, intermediaries and data providers. “We’ll continue these tests for the next few weeks before shifting to the new system,” he said.
He said the new system is capable of handling more than two million deals daily. Tadawul signed an agreement in May last year with a specialized company to design and implement new generation stock exchange systems. Under the agreement, the company will provide technical support and maintenance to five years.
