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Kuwait Financial Centre “Markaz” GCC Daily Fixed Income Report – 31 January 2012 News Update Saudi Central Bank To Keep Key Rates Unchanged In FebruaryThe Saudi central bank has decided to keep its key interest rates unchanged in February, as inflation pressures remain under control. The Saudi Arabian Monetary Agency told the kingdom's banks that it will hold its overnight reverse repo rate at 0.25% next month, and the benchmark repurchase rate at 2%. Annual inflation in the kingdom edged up to 5.3% in December, from 5.2% in November, led by a 9.2% annual increase in rent prices, data from the Central Department of Statistics and Information showed earlier this month. DP World Sees 2011 Gross Profit In „Line With Expectations‟- DP World Ltd., the Dubai World-controlled ports operator, said it expects fullyear gross profit to be in “line with expectations” after a 10% rise in container volumes last year. The company handled 54.7 million twenty-foot equivalent container units at its ports last year compared with 49.6 million TEUs a year earlier, it said in a statement to Nasdaq Dubai today. Volumes at terminals the company consolidates for accounting purposes grew to 27.5 million TEUs. “Whilst uncertainty continues to affect the global economy, our business is still performing well,” said CEO Mohammed Sharaf. “We made good progress through the fourth quarter of 2011 and we will achieve 2011 full year EBITDA in line with expectations. Lower than expected net financing charges will benefit reported profit before tax.” Dana Gas Sukuk Yields Near Record On Payment Risk & 4Q Profit Rises To AED147 Mn- Dana Gas PJSC‟s Islamic bonds plunged, lifting yields close to a record, after the UAE fuel producer failed to disclose a plan for repaying the debt when it reported full-year earnings. The $1bn of 7.5% Shariah-compliant notes maturing in October fell a quarter of a cent to 68.17 on the dollar yesterday, pushing up the yield 79bps to 64.7%, the highest since Jan. 16. That day, the rate reached an all-time high of 71.8%. Dana Gas, which said yesterday 2011 profit more than tripled, didn‟t give investors details of how it plans to pay the sukuk. Dana Gas posted a fourth quarter net profit of AED147mn, up from AED59mn a year earlier, on the back of growing production, higher realized oil prices, and optimized cost management.

Select GCC Bond and Sukuk Prices (30 January 2012) Type Bond Bond Bond Bond Bond Bond Bond Bond Sukuk Sukuk

Name State of Qatar State of Qatar Emirate of Abu Dhabi Emirate of Abu Dhabi Mubadala Development Co. Mubadala Development Co. Qatar Telecom Qatar Telecom Aldar Properties DP World Ltd

Bid Price 106.886 117.986 108.250 120.250 107.571 119.762 108.702 122.056 109.876 103.075

Ask Price 107.436 118.625 109.000 121.250 108.157 120.663 109.387 122.928 110.666 103.981

Bid Yield 1.913% 3.677% 1.632% 3.531% 2.289% 4.412% 2.658% 4.338% 6.105% 5.583%

Ask Yield 1.667% 3.585% 1.300% 3.390% 2.034% 4.281% 2.372% 4.215% 5.758% 5.391%

HSBC/NASDAQ Dubai GCC Sukuk & Bonds US Dollar Index Sukuk 27-January-12 31-December-11 Conventional 27-January-12 30-December-11

Total Return 133.58 133.00 142.59 141.59

3.53 3.59

4.30 4.31

337.25 312.20

Clean Price 3.92 95.80 3.99 95.79

5.40 5.26

4.93 5.07

319.93 322.59

7.54 7.31

Duration Yield

Spread

Life

Coupon Total Market Cap

98.78 98.53

5.06 5.06

142.30 142.39

5.53 5.63

877.29 808.83

Interbank Rates (%) SAIBOR KIBOR BHIBOR QATAR AEIBOR LIBOR EURIBOR

1-Month 31/01/12 31/12/11 0.5225 0.5188 0.5625 0.5625 0.8583 0.8500 0.6300 0.4300 0.9813 0.9750 0.2678 0.2953 0.6607 0.9643

U.S. Treasuries (30 January 2012) 3-Month 2-Year 3-Year 5-Year 10-Year 30-Year

Coupon 0.000 0.250 0.250 0.875 2.000 3.125

Banque Audi: Dubai Likely To Manage 2012 Debt Rollover- Dubai is likely to manage its debt maturing this year as its trade and tourism benefit Equity Market Snapshot Last Close from the regional political upheavals, Banque Audi Sal said. Central Bank Of Bahrain Treasury Bills Are A Success- The Central Bank of Bahrain announced that this week's BHD35mn issues of government treasury bills have been oversubscribed by 229%. The bills, carrying a maturity of 91 days, are issued by the CBB, on behalf of the Bahrain government. The issue date of the bills is tomorrow and the maturity date is May 2. The weighted average rate of interest is 1.25% compared with 1.25%, for the previous issue on January 18.

Maturity Size (Mn) Rating 9-Apr-14 2,000 AA/Aa2 9-Apr-19 1,000 AA/Aa2 8-Apr-14 1,500 AA/Aa2 8-Apr-19 1,500 AA/Aa2 6-May-14 1,250 Aa3/Aa2 6-May-19 500 Aa3/Aa2 10-Jun-14 900 A/A2 10-Jun-19 600 A/A2 27-May-14 1,500 BB-/B1 2-Jul-17 1,500 BBB-/Baa3

Abu Dhabi SE Bahrain SE Dubai SE Kuwait SE Muscat SE Qatar SE Saudi SE

2,421.68 1,139.28 1,401.56 5,857.60 5,594.37 8,440.11 6,554.78

3-Month 31/01/12 31/12/11 0.8138 0.7800 0.8125 0.8125 1.2667 1.2583 1.0300 1.1000 1.5425 1.5200 0.5469 0.5810 1.0651 1.2921

Price 0.055 100.078 99.844 100.633 101.266 102.328

Price Change 0.003 0.004 0.004 -0.043 -0.117 -0.125

1 Day Change 0.0% -0.3% 0.3% 0.1% -0.1% 0.6% 0.1%

YTD Change 0.8% -0.7% 3.9% 0.9% -1.8% -3.3% 2.2%

31/01/12 1.0525 1.3125 1.9583 2.2400 1.9850 1.0975 1.7379

1-Year

31/12/11 1.0400 1.3125 1.9583 2.1500 1.9725 1.1281 1.9134

Current Yield (%) Yield Change (%) 0.058 9.525 0.213 -0.024 0.305 0.017 0.747 1.284 1.859 0.752 3.007 0.248

Crude Oil Brent WTI OPEC

Price 111.45 99.30 111.31

1 Day ∆ 0.63% 0.53% 0.04%

Gold Spot $/OZ

Price 1,735.85

1 Day ∆ 0.35%

GCC Sovereign Ratings Moody‟s S&P Abu Aa2 AA Dhabi

Fitch

Bahrain Baa1 BBB

BBB

Kuwait Aa2

AA

AA NR

AA

Oman

A1

A

Qatar

Aa2

AA

NR

KSA

Aa3 AA-

AA-

UAE

Aa2

NR

NR

GCC Currencies Currency

USD 1-Day ∆

KWD

0.2774 (0.0003)

SAR

3.7503

0.0001

BHD

0.3770

0.0000

QAR

3.6413 (0.0001)

OMR

0.3850 (0.0002)

AED

3.6730

0.0000

EUR/USD 1.3195

0.0066

JPY

76.1900 (0.1300)

USD 5-Year CDS Abu Dhabi Dubai

YTD Change

139.595

9.5%

436.010

-2.0%

Bahrain 430.000

12.2%

Qatar

139.765

9.7%

Saudi

139.660

8.6%

Egypt

570.985

-10.7%

Lebanon 480.000

1.8%

Turkey

280.050

-3.9%

China

139.895

-4.9%

France

176.980

-19.5%

Germany 91.310

-10.6%

Japan

136.085

-5.0%

UK

81.430

-16.5%

US

45.030

-8.0%

This report has been prepared and issued by Kuwait Financial Centre S.A.K (Markaz) , which is regulated by the Capital Markets Authority and the Central Bank of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of this report is strictly prohibited. This report cannot be quoted without the prior written consent of Markaz. Any user after obtaining Markaz permission to use this report must clearly mention the source as “Markaz “ .This Report is intended to be circulated for general information only and should not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy in any jurisdiction. The information and statistical data herein have been obtained from sources we believe to be reliable but in no way are warranted by us as to its accuracy or completeness. Markaz has no obligation to update, modify or amend this report.For further information, please contact „Markaz‟ at P.O. Box 23444, Safat 13095, Kuwait. Tel: 00965 1804 800 Fax: 00965 2245 0647 Email: research@markaz.com

A number of sources which include Bloomberg, Zawya, and daily newspapers were utilized in the creation of this report.


GCC Daily Fixed Income Update 31012012