Wednesday, Jul 07, 2010
0835 GMT [Zawya Dow Jones]--Rasmala initiatives coverage of the U.A.E. banking sector, says banks are undervalued and the sector has already priced in balance sheet risks and concerns over Dubai Inc. restructuring. "We believe current valuations reflect continued dire expectations for Dubai, with elevated provisioning for an indefinite period and with a fundamentally broken business model. We do not agree with this outlook," Rasmala says. Adds "returns for the sector are set to recover strongly once provisioning settles down" though growth looks elusive. Initiates coverage of Abu Dhabi Commercial Bank with a buy rating, AED1.81 target price; Abu Dhabi Islamic Bank with a hold stance, AED2.67 target price. Starts Dubai Islamic Bank at hold, AED1.97 target; initiates Emirates NBD at buy, AED3.26 target price, First Gulf Bank at hold, AED16.27 target. Starts National Bank of Abu Dhabi at buy, AED12.86 target price. (nour.malas@dowjones.com )
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(END) Dow Jones Newswires
07-07-10 0841GMT
