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Kuwait Financial Centre “Markaz” GCC Daily Fixed Income Report – 27 March 2012 News Update Select GCC Bond and Sukuk Prices (26 March 2012) Kuwait's IIG Says Close To Rescheduling Debt, Including $200 Mn Type Name Maturity Size (Mn) Rating Bid Price Sukuk- Kuwait's International Investment Group (IIG) said yesterday it Bond State of Qatar 9-Apr-14 2,000 AA/Aa2 107.248 expects to an agreement soon with creditors to reschedule its debt, which Bond State of Qatar 9-Apr-19 1,000 AA/Aa2 118.940 Bond Emirate of Abu Dhabi 8-Apr-14 1,500 AA/Aa2 108.630 mainly consists of sukuk maturing this year. These mudarabah sukuk, Bond Emirate of Abu Dhabi 8-Apr-19 1,500 AA/Aa2 121.750 which represent 75% of IIG's overall financial obligations, had a nominal Bond Mubadala Development Co. 6-May-14 1,250 Aa3/Aa2 107.581 value of $200mn at the issue date, the Islamic investment bank said. IIG Bond Mubadala Development Co. 6-May-19 500 Aa3/Aa2 121.242 and the majority of the sukuk holders signed earlier this month a term Bond Qatar Telecom 10-Jun-14 900 A/A2 109.342 sheet whereby the two parties have agreed in principle on the basic Bond Qatar Telecom 10-Jun-19 600 A/A2 122.799 elements of the restructuring plan. IIG was one of nine companies that Sukuk Aldar Properties 27-May-14 1,500 BB-/B1 109.727 Kuwait's Capital Markets Authority de-listed last month from the local Sukuk DP World Ltd 2-Jul-17 1,500 BBB-/Baa3 105.071 bourse. The company's shares are still listed on the Bahrain and Dubai HSBC/NASDAQ Dubai GCC Sukuk & Bonds US Dollar Index bourses. Total Clean DP World To Use Cash To Repay $3 Bn Credit Facility 6 Months Early- DP World said it will repay a $3bn credit facility six months early with existing cash, while the government-controlled firm has no pressing need to draw on a new, soon-to-be completed, five-year loan worth $1bn as it continues its focus on fast growing emerging markets. The loan repayment will reduce DP World's total debt to about $4.7bn, chairman Sultan Bin Sulayem said. DP World said it will cancel $2bn of its existing revolving credit facility and retain an as yet untouched $1bn facility. Saudi Borrowing Costs Rise To 10-Month High As Lending Picks Up- Saudi Arabia’s one-year and six-month treasury bill yields rose to 10month highs after loan growth reached the fastest pace in almost three years, lifting borrowing costs in Saudi. The Gulf nation paid 0.58% on oneyear notes at its weekly auction today, up 4bps from last week’s sale. The yield, which has risen in the last four auctions, is up 6bps this month to the highest level since May. The yield on six-month notes gained 2bps to 0.456%, also the highest in 10 months. Borrowing costs are rising in Saudi as it pursues plans to spend more than $500bn to develop infrastructure, build homes and create jobs. Claims on the private sector grew 12.1% in February, the fastest pace since March 2009. Treasury-bill sales rose 3.8% in February to SAR130.8bn ($35bn), the first monthly increase since May. GCC Banks Rush To Sell Bonds Amid Low-Rate `Window'- Gulf banks are rushing to tap foreign bond markets for long-term money, taking advantage of interest rates near 20-year lows during what is the best-ever quarter for regional bond sales. Six banks from the UAE and Qatar raised $4.8bn from 13 bond issues in the first three months of 2012. Another lender is holding meetings with investors for a possible sale. Emirates NBD, the UAE’s biggest bank by assets, sold a $1bn five-year note March 21 while Doha Bank, Qatar’s fifth-biggest bank, raised $500mn March 7. Bond sales in the world’s biggest oil-exporting region have almost doubled to $12bn so far in the first quarter, the most for the three-month period since at least 1999.

Sukuk

22-March-12 31-December-11 Conventional 22-March-12 30-December-11

Return 136.28 133.00 145.47 141.59

Duration Yield

Spread

Life

3.48 3.59

3.95 4.31

279.76 312.20

Price 3.86 97.04 3.99 95.79

5.33 5.26

4.67 5.07

279.01 322.59

7.40 7.31

Ask Price 107.764 119.565 109.000 122.250 108.119 122.134 109.946 123.517 110.302 105.592

Bid Yield 1.502% 3.487% 1.169% 3.259% 2.042% 4.140% 2.119% 4.172% 5.877% 5.135%

Ask Yield 1.255% 3.396% 0.993% 3.188% 1.792% 4.011% 1.852% 4.070% 5.608% 5.024%

Coupon Total Market Cap

100.10 98.53

5.02 5.06

157.60 142.39

5.51 5.63

911.28 808.83

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

1-Month 27/03/12 31/12/11 0.5675 0.5188 0.5625 0.5625 0.8417 0.8500 0.8100 0.4300 0.9750 0.9750 0.2413 0.2953 0.3601 0.9643

U.S. Treasuries (26 March 2012) 3-Month 2-Year 3-Year 5-Year 10-Year 30-Year

Coupon 0.000 0.250 0.375 0.875 2.000 3.125

Equity Market Snapshot Abu Dhabi SE Bahrain SE Dubai SE Kuwait SE Muscat SE Qatar SE Saudi SE

Last Close 2,587.67 1,155.61 1,669.18 6,221.50 5,916.14 8,705.15 7,758.66

Price 0.080 99.820 99.539 99.000 97.766 95.844

1 Day Change -0.4% -0.1% -0.8% -0.2% -1.5% 0.2% 0.3%

3-Month 27/03/12 31/12/11 0.8738 0.7800 0.8125 0.8125 1.2667 1.2583 1.0000 1.1000 1.5363 1.5200 0.4727 0.5810 0.7013 1.2921 Price Change -0.003 0.004 -0.004 -0.020 -0.039 -0.109 YTD Change 7.3% 0.9% 22.3% 6.8% 2.3% -0.6% 21.3%

27/03/12 1.0863 1.3125 1.9500 2.3300 1.9863 1.0515 1.4075

1-Year

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

Current Yield (%) Yield Change (%) 0.084 0.000 0.346 0.039 0.535 0.781 1.085 0.467 2.254 0.242 3.348 0.231

Crude Oil Brent WTI OPEC

Price 125.41 106.77 122.77

1 Day ∆ -0.19% -0.24% 0.80%

Gold Spot $/OZ

Price 1,688.46

1 Day ∆ -0.08%

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

0.2782 (0.0003)

SAR

3.7503

0.0001

BHD

0.3770

0.0000

QAR

3.6407 (0.0006)

OMR

0.3850 (0.0001)

AED

3.6731

0.0001

EUR/USD 1.3353

0.0025

JPY

0.0600

82.8700

USD 5-Year CDS Abu Dhabi Dubai

YTD Change

116.340

-8.8%

335.000

-24.7%

Bahrain 358.460

-6.5%

Qatar

117.220

-8.0%

Saudi

118.500

-7.8%

Egypt

553.855

-13.4%

Lebanon 445.575

-5.5%

Turkey

219.690

-24.6%

China

106.280

-27.8%

France

170.895

-2.3%

Germany 72.400

-29.1%

Japan

92.835

-35.2%

UK

62.245

-36.2%

US

30.085

-38.6%

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.


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