Page 16 - MEOG Week 22

MEOG
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MEOG
P o L I C y
EPDK warns of price ceiling for Turkey’s fuel retailers
Turkey’s EPDK energy regulator said on June 2 that fuel prices in the country were too high and that it would have to step in if companies did not lower them.
In a statement, EPDK chairman Mustafa Yilmaz said that volatility in fuel prices amid the coronavirus (COVID-19) pandemic had a negative impact on consumers. The regulator would need to impose a price ceiling if price margins were not lowered.
Yilmaz said that the EPDK had called on companies to take the required steps.
The collapse in oil prices that came with the arrival of the pandemic and its negative impact on energy demand from locked down industry and consumers is a boon for Turkey in that the country is almost entirely dependent on imports to meet its energy demand, but consumers, struggling amid the fragile Turkish economy following last year’s recession, will want to see that translate to gains in their pocket.
The Erdogan administration is going all out to achieve a consumer-spending-driven bounceback from the recession and the damage wrought by the pandemic effects. bne
LiquidityindicatorsinSaudi
banking system improve in
April
Liquidity indicators in the Saudi banking system improved in April, with the aggregate liquidity ratio at commercial banks rising
to 10.31 from 10.10 in March, according to figures released by the monthly statistical
bulletin of the Saudi Arabian Monetary Authority (SAMA).
The surge in liquidity in April happened as households and corporates turned to hoarding cash in the form of short-term demand deposits amid the economic shock of the coronavirus (COVID-19) outbreak.
The liquidity ratio, which accounts for bank reserves over total deposits, rose mainly due to a strong 3% month-on-month growth in bank reserves held with SAMA
to SAR188bn ($50.8bn), outpacing the 1% m/m expansion in total deposits to SAR1.829 trillion in April.
Meanwhile, a 0.8% m/m expansion in credit extended by Saudi banks to households and corporate clients for consumption and investment purposes (Claims on Private Sector) to SAR1.647 trillion in April caused the ratio of bank claims on the private sector to total deposits at commercial banks to decline to 90.07 in April from 90.23 in March. bne
Emirate of Sharjah starts
marketing 7-year dollar
sukuk
Sharjah, the third-largest emirate of the United Arab Emirates, began marketing seven-year sukuk, or Islamic bonds, denominatedinUSdollarsonTuesday, according to a document from one of the banks arranging the deal.
It comes as several governments in the Gulf seek to bolster their finances to face the economic fallout from the coronavirus pandemic and a historic slide in oil prices.
Sharjah gave an initial price guidance of around 275 basis points over midswaps for the sukuk, which are Islamic sharia-compliant bonds, according to the document seen by Reuters.
Two sources close to the deal, which is expected to close later on Tuesday, said the issuance would likely be between $750 million and $1 billion.
Sharjah, rated Baa2 by Moody’s ratings agency and BBB by S&P, is a relatively frequent issuer of US dollar Islamic bonds.
hSBC was hired as global coordinator for the transaction, according to the document.
Other banks on the deal are Bank ABC, Dubai Islamic Bank, Gulf International Bank, Mashreqbank and Sharjah Islamic Bank, the document also showed.
In May, the emirate raised 2 billion dirhams ($544.54 million) in privately placed one-year sukuk to support its economy during the coronavirus pandemic, according to a statement by Bank of Sharjah, which arranged that deal.
S&P Global Ratings in April revised its outlook on the emirate to negative from stable due to lower oil prices and the impact of the new coronavirus.
“Although we expect GDP growth to recover in 2021, lower-for-longer oil prices and a protracted lockdown period could pressure the emirate’s fiscal position,” the agency has said.
reUters
o I L
Middle East oil is still a
favourite for India’s top
refiner
India’s biggest refiner is sticking to Middle Eastern oil as suppliers offer deep discounts, suggesting rival producers may have a harder time making inroads in the world’s third- largest crude importer.
Gulf producers such as Iraq and Saudi
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Week 22 03•May•2020