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Kuwait Financial Centre “Markaz” MENA Daily Fixed Income Report –07 October 2012 News Update GCC Bond & Sukuk: Best and worst Performers Abu Dhabi's First Gulf Bank Says $650M Bond Sale Daily Best daily Performers Worst daily Performers Oversubscribed- Abu Dhabi-based First Gulf Bank 's recent $650 million, change five-year bond sale was more than four times subscribed as investors QTEL INTERNATIONAL FIN 2025 0.72% DANA GAS SUKUK LTD 2012 0.58% GE CAPITAL SUKUK LTD 2014 placed orders worth $2.7 billion, the company said Thursday. The bank DUBAI HOLDING COMM OP 2017 0.55% PYRUS LTD 2015 issued the debt under an existing medium-term note program on Monday. NAKILAT INC 2033 0.54% KINGDOM OF BAHRAIN 2020 The interest rate was fixed at 2.862%, or 210 basis points over midswaps, IPIC GMTN LTD 2041 BURGAN FINANCE NO.1 LTD 2020 0.43% IDB TRUST SERVICES LTD 2015 the bank said. Citigroup, Deutsche Bank, HSBC, National Bank of Abu Monthly Best monthly Performers Worst monthly Performers Dhabi and Standard Chartered acted as joint lead managers and change bookrunners in the transaction. Most of the bonds were sold to investors NAKILAT INC 2033 3.43% NATIONAL BK OF ABU DHABI 2042 2.43% CBB INTERNATIONAL SUKUK 2013 from the Middle East and North Africa, while 27% were from Europe and RAS LAFFAN LNG 3 2027 1.97% DUBAI GOVT INT'L BONDS 2015 13% from Asia, FGB said. Banks and fund managers bought most of the RAS LAFFAN LNG 3 2027 IPIC GMTN LTD 2041 1.49% TAMWEEL FUNDING LTD 2017 debt Gulf Keystone Placed $300m in Convertible 5-Year Bonds- Co. successfully placed $275m in 5- year convertible unsecured notes at coupon 6.25% p.a.; with over allotment of $25m exercisable up to COB on October 16. BNP Paribas is the sole bookrunner, lead manager. Turkish $1.5b sovereign sukuk shows global appetite for SukuksLiquidity House said its mandate for Turkish Treasury Islamic bond further strengthened its leadership as a leading provider of Islamic advisory services with a focus on global Sukuk structuring and placement. Liquidity House said that it had just completed a mandate for the Turkish government. The firm, it added, alongside Citigroup and HSBC, advised on the Turkish Treasury‟s recently concluded debut sovereign Sukuk issue, which had an order book almost five times of the issue size, ultimately raising $1.5 billion. Deutsche Bank’s Aram Says Gulf Arab Bond Sales to Remain Strong- Bond sales from the six-nation Gulf Cooperation Council will remain “strong” as companies in these countries seek a substitute for declining lending from European banks, the regional head of Deutsche Bank AG, said. The pipeline for bond sales in the GCC is “very, very strong and I think will remain” that way, Ashok Aram, chief executive officer for the Middle East and North Africa for the bank, said at a news conference in Dubai. The GCC region has “relied a lot on bank loans but bank loans are going to be more constrained” as European lenders reduce debt and seek to raise capital to comply with more stringent rules, he said. Lebanon’s Finance Ministry to offer $1.5 billion in EurobondsLebanon‟s Finance Ministry will tap the local market again to raise close to $1.5 billion in Eurobonds to finance the public debt amid indication that local lenders will snap up most of the new issue. Most Lebanese banks received letters from the Central Bank stating that the Finance Ministry intends to issue up to $1.5 billion in Eurobonds. The letter said that part of this issue will mature in 2028

ARAB REPUBLIC OF EGYPT 2020

1.26% YTD change 37.90% 32.30% 31.63% 28.34% 28.04%

Best YTD Performers NATIONAL BK OF ABU DHABI 2036 IPIC GMTN LTD 2041 ANKA A SUKUK LTD 2016 DUBAI HOLDING COMM OP 2017 MBPS FINANCE CO 2015

DUBAI GOVT INT'L BONDS 2013

Worst YTD Performers DANA GAS SUKUK LTD 2012 TAQA ABU DHABI NATL ENER 2012 DUBAI GOVT INT'L BONDS 2014 LEBANESE REPUBLIC 2015 TAQA ABU DHABI NATL ENER 2013

Daily change -0.35% -0.10% -0.08% -0.06% -0.06% Monthly change -0.25% -0.25% -0.20% -0.15% -0.13% YTD change -3.32% -2.77% -2.63% -2.06% -1.84%

Source: Bloomberg, Markaz Analysis

HSBC/NASDAQ Dubai Middle East US Dollar Sukuk /Bond Index Sukuk 05-Oct-12 31-Dec-11

Total Return 163.501 148.84

Duration Yield 5.051 4.99

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

3-Month 07/10/12 31/12/11 0.9620 0.5188 0.8125 0.5625 1.2383 0.8500 1.2285 0.4300 1.3025 0.9750 0.3540 0.2953 0.2200 0.9643 4.9940 3.8410 6.6097 11.2750

3.80 5.07

Spread 241.76 326.79

Clean Coupon Total Market Cap Price 6.42 105.031 5.39 1506.90 6.80 99.35 5.81 1157.44

Life

6-Month 07/10/12 31/12/11 1.0081 0.7800 1.0625 0.8125 1.5400 1.2583 1.3857 1.1000 1.4713 1.5200 0.6259 0.5810 0.4350 1.2921 5.4220 4.2380 7.1113 11.316

1-Year 07/10/12 31/12/11 1.1360 1.0400 1.3125 1.3125 1.9033 1.9583 1.7357 2.1500 1.6025 1.9725 0.9615 1.1281 0.6810 1.9134 5.9130 5.2000 7.4797 11.3743

U.S. Treasuries 07 October 2012 3-Month 2-Year 3-Year 5-Year 7-Year 10-Year 30-Year

Current Yield (%) 0.10 0.26 0.34 0.67 1.13 1.74 2.97

1-Day ∆ (%) -0.005 0.016 0.024 0.043 0.066 0.070 0.082

Currency KWD SAR BHD QAR OMR AED EGP JOD EUR/USD

USD 0.2806 3.7502 0.3770 3.6407 0.3841 3.6730 6.0917 0.7077 1.3045

1-Day ∆ (0.0003) (0.0001) 0.0000 (0.0003) (0.0009) 0.0001 (0.0016) (0.0003) 0.0027

1 Year (%) -1.087% 0.005% 0.003% 0.017% 0.013% 0.000% -2.118% 0.057% -2.27%

MENA Sovereign Ratings Moody’s S&P Fitch Abu Aa2 AA AA Dhabi Bahrain Baa1 BBB

BBB

Kuwait

Aa2 AA

AA

Oman

A1

NR

Qatar

Aa2 AA

NR

KSA

Aa3 AA-

AA-

UAE

Aa2 NR

NR

Egypt

B2

B

B+

Lebanon B1

B

B

Turkey

BB

BB+

Tunisia Baa3 BB

BBB-

Ba1

A

Morocco Ba1 BBB- BBBJordan

Ba2

BB

NR

China

Aa3 AA-

A+

UK

Aaa AAA

AAA

US

Aaa AA+

AAA

USD 5-Year YTD CDS Change Abu 107.080 -16.2% Dhabi Dubai 282.994 -34.9% Bahrain 260.000 -32.1% Qatar

107.020 -16.2%

Saudi

88.540 -31.1%

Egypt

424.995 -33.5%

Lebanon 444.480 Turkey Iran

-5.7%

150.595 -48.5% 36.130

-6.1%

Morocco 242.495 -9.3% China

83.095 -43.5%

France

102.955 -53.1%

Germany 50.145 -50.9% Japan

82.910 -42.1%

UK

49.535 -49.1%

US

47.500

-3.0%

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.

DFIU07102012  

DFIU07102012

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