• Home
• /
• Business

Saudi Arabia seen growing to 5 per cent this year: IMF

JEDDAH - An International Monetary Fund (IMF) report on Tuesday showed that the 2008 economic growth outlook for Saudi Arabia remains 'favourable'.

According to the IMF, the Saudi Arabian economy is expected to grow 5 per cent in real terms in 2008, up from 3.5 per cent expansion recorded in 2007. Further, the report showed that oil output is forecast to rebound to 9.2 million barrels/day. In addition, the IMF sees further acceleration in non-oil growth.

The IMF report said that reflecting higher oil prices, a record current account surplus of $191 billion, which accounts 35 per cent of gross domestic product, is projected despite continued strong import growth.

It said that exacerbated by rising imported commodities and domestic supply constraints inflation is projected to peak from 4.1 per cent in the previous year to around 10.6 per cent in 2008. However, it is forecast to ease in subsequent years.

From our correspondent

Ithmaar posts record half year profit of $141.9m

By a staff reporter

BAHRAIN - Ithmaar Bank, a Bahrain-based investment bank with global reach, today announced a 115 per cent surge in its half year net profit to a record $141.9 million, up from $65.9 million for the same period last year. As Ithmaar Bank's subsidiaries and associates continued their upward trend, operating profits nearly doubled from $71.1 million for the first half of 2007 to $139 million for the period ended 30 June 2008. Return on equity (annualised) remained strong at 21 per cent. These results reflect the Bank's strongest mid-year financial performance since it went public in early 2006.

Income from investments contributed $139 million, income from financing contributed $91 million, while $28.8 million were collected in fees and commissions. Total assets showed significant growth of 14.4 per cent, totalling $4.7 billion at the end of June 2008, compared with $4.1 billion as of 31 December 2007.

QIA writes off value of Four Seasons Health Care equity stake

LONDON- Qatar Investment Authority(QIA) has written off the value of its equity holding in Four Seasons Health Care Ltd., a UK care-home provider, the Wall Street Journal reported, citing an unidentified person familiar with the situation. Four Seasons was bought by the sovereign wealth fund's former UK investment vehicle, Three Delta LLP, for £1.4 billion ($2.7 billion) in 2006, with £1.3 billion of debt and £100 million of equity, the Journal said.

QIA took control of Four Seasons, which was heading toward a covenant breach for an approaching repayment deadline next month, the newspaper said.

The Qatari fund has written off the stake in Four Seasons after extended discussions with its creditors, including Royal Bank of Scotland Group Plc, the newspaper said. No one at QIA, Four Seasons or RBS could be reached for comment, the Journal said.-

Bloomberg

Morgan Stanley rates CBQ 'overweight'

BANGALORE- Morgan Stanley started coverage of Commercial Bank of Qatar with an "overweight" rating, saying the current share price represented a good entry point. Commercial Bank, Qatar's third-largest bank by market value, has transformed itself into a pan-Gulf Cooperation Council bank alliance following its acquisition of stakes in National Bank of Oman and United Arab Bank, Morgan Stanley said.

By ignoring the bank's exposure to the GCC, the market is underestimating its potential profit growth, the investment bank said. "We see potential positive surprises from associates, which should have an impact on CBQ's net income," it said in a note.

Reuters

Kuwait Food second-quarter profit falls 28 per cent

DUBAI - Kuwait Food Co., a food processing and restaurant operator known as Americana, said second-quarter profit fell 28 per cent, without giving a reason. Net income dropped to 20.96 million dinars ($78 million), or 54 fils a share, from 29.2 million dinars, or 75 fils, a year earlier, the company said today in a regulatory filing to the Kuwait Stock Exchange.

Bloomberg