Saturday, May 22, 2010

Dubai World, Nakheel update

The Dubai World agreement in principle is described in a Gulf News article that describes in broad terms the level of write-downs banks holding Dubai World debt will have to take. The article, however, does not address whether I was correct in calculating a 40% reduction in Dubai World debt although it does present the total debt being restructured as being $23.5 billion with total debt after the restructuring of $14.4 billion. Nakheel's restructuring, which appears to be separate from Dubai World's restructuring, has already been approved by 50 percent of creditors, is expected to be approved by at least the 65% of creditors required within 2 weeks.

Other News

  • The JAFZ sukuk is scheduled to make a distribution payment of $128 million on Thursday, May 27th.
  • Analysts at the International Islamci Finance Forum 2010 predict that Islamic banks will manage $4 trillion in assets by 2020. This is roughly four times the current size, although statistics about the size of the industry are often unreliable.
  • OIC countries, led by Malaysia, may launch a clean energy development bank to promote renewable energy projects in OIC-member countries.
  • Bank Negara Malaysia governor Zeti Akhtar Aziz says that the cental bank is developing financial instruments "that will facilitate cross-border transactions by financial institutions to improve liquidity in the Islamic banking system".
  • The Malaysia Airports Holding Bhd is planning MYR2.5 billion in sukuk and conventional bonds. The sukuk portion will be MYR1 billion.
  • An article provides additional commentary on the newly announced sukuk from Malaysia.

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