Jan 07 2011 |
more articles from
|
Economic policy: ABC enters Libyan market after increase in CBL stake
In early December, the Central Bank of Libya ( CBL ) bought an additional 17.72% stake in the Bahrain-based Arab Banking Corporation ( ABC ) for an undisclosed sum. The stake, purchased from the Abu Dhabi Investment Authority ( ADIA ), takes the CBL 's overall share in ABC up to 59.37%. The CBL started to build up its stake in ABC in March 2010, when it acquired ADIA 's rights in ABC 's US$1.1bn capital issue, which took its original holding up from 29.5% to 41.7%. The Kuwait Investment Authority is the bank's other principal shareholder, with 29.7%. ABC is Bahrain's second-largest offshore bank, with total assets of over US$26bn.
The acquisition was not wholly positive from a credit-rating perspective; two weeks later, Fitch Ratings downgraded the bank's short-term issuer default ratings (IDR) from F2 to F3, its long-term foreign-currency IDR from BBB+ to BBB, the rating on its senior unsecured debt from BBB+ to BBB and the rating on its subordinated debt from BBB to BBB-. The downgrade reflects Fitch's concerns that the CBL is not as robust a shareholder as ADIA , although Fitch maintained its outlook as stable, suggesting that it believes that there remains a "high likelihood" of support from its main shareholders, should the necessity arise.
Shortly after the CBL 's acquisition, ABC itself purchased a 49% stake in Libya's Mediterranean Bank for US$60m, boosting its presence in Libya, where it has had a representative office since 1988. Given its stake in ABC , the CBL is in the slightly anomalous situation of granting regulatory approval for the deal, which is expected before the end of the first quarter of 2011. The deal continues a policy of increasing foreign presence in the banking sector. BNP Paribas (France) and Arab Bank (Jordan) have stakes in local banks and a joint-venture banking licence was awarded to UniCredit (Italy) in August.
Zawya Comment Policy
-
Zawya encourages you to add a comment to this discussion. You agree that when you add content to this discussion your comments will not:
1.1 Contain any material which is libelous or defamatory of any person, is obscene, offensive, hateful or inflammatory or causes damage to the reputation of any person or organisation.
1.2 Promote sexually explicit material, violence, discrimination based on race, sex, religion, nationality, disability, sexual orientation or age or any illegal activity.
1.3 Be made in breach of any legal duty owed to a third party, such as a contractual duty or a duty of confidence.
1.4 Be threatening, abuse or invade another's privacy, or cause annoyance, inconvenience or needless anxiety.
1.5 Be used to impersonate any person, to misrepresent your identity or affiliation with any person, or be likely to deceive any person.
1.6 Give the impression that they represent Zawya.
1.7 Advocate, promote or assist any unlawful act such as (by way of example only) copyright infringement or computer misuse. - The content posted on www.zawya.com is created by members of the public. The views expressed are theirs and unless specifically stated are not those of Zawya. Zawya reserves the right to review all comments prior to posting and edit or delete any contribution, but Zawya is not responsible for and can not be held liable for any content posted by members of the public on www.zawya.com.
- Zawya is not responsible for the availability or content of any third party sites that are accessible through www.zawya.com. Any links to third party websites from www.zawya.com do not amount to any endorsement of that site by Zawya and any use of that site by you is at your own risk.
- By submitting your comment, you hereby give Zawya the right, but not the obligation, to post, air, edit, exhibit, telecast, webcast, re-use, publish, reproduce, use, license, print, distribute or otherwise use your comments worldwide, in perpetuity.
Copyright © 2012 Zawya Ltd. All rights reserved. |
provided by www.zawya.com |
Post Your Comment