* S&P Global Ratings said the killing of Iranian general Qassem Soleimani by the U.S. last week and its ongoing fallout has rapidly increased event risk in the Gulf region, but it continues to believe that any escalation of military action between the two countries will remain contained as a direct conflict would be economically, socially, and politically destabilizing for the entire region. Should a protracted and wider conflict materialize, the agency said it expects Abu Dhabi, Kuwait, Qatar and Saudi Arabia to be better cushioned by their large stocks of deployable government external assets, while on a flow basis, Bahrain and Qatar will be more vulnerable to outflows given their high external financing needs related to their banking sectors.
GULF COOPERATION COUNCIL
* Conventional spreads on five-year Saudi Arabian credit default swaps, or the cost of insuring against a potential debt default by the country, has surged by a sixth since a U.S. airstrike in Baghdad on Dec. 3 killed Qassem Soleimani, a general who headed Iran's Islamic Revolutionary Guard Corps' elite Quds Force, Reuters reported, citing IHS Markit.
* The Saudi Arabian Monetary Authority approved the renewal of Arabia Insurance Cooperative Co.'s insurance license for three years beginning Feb. 5, Argaam wrote, citing a bourse statement.
* Mohammad al-Hawari has resigned as a member of Dubai-based Takaful Emarat - Insurance (PSC)'s board, effective Jan. 6.
* KAMCO Investment Company K.S.C.P. has unveiled a new corporate identity following its recent merger with Global Investment House KSC (Closed). The combined entity has been named Kamco Invest, which will be the fifth largest asset manager in the Gulf region with AUM of roughly $13.7 billion, Arabian Business wrote.
* Hazem Abdalla Abdelhamid Elbakry, head of the assets management department at Al Madina for Finance and Investment Co. KSCP, has resigned from his post.
* Warba Capital Holding Co.elected a new board of directors, with Abdulatif al-Dabous and Ahmed Jassim al-Qamar as chairman and deputy chairman, respectively. The new board will serve for a period of three years.
* First Investment Co. KSCP received regulatory approval to buy, sell and dispose 10% of its treasury shares for a period of six months.
* Al Madina Insurance Co. SAOG appointed Hamed Saif al-Siyabi as head of compliance and Kashif Ijaz as head of internal audit.
REST OF MIDDLE EAST AND NORTH AFRICA
* Israel-based online trading platform Plus500 Ltd. expects revenue of about $354 million and EBITDA of roughly $190 million for the financial year ended Dec. 31, 2019, down from $720.4 million and $506.0 million, respectively, a year earlier. The projected decline in revenue comes after a series of regulatory measures on contract-for-difference bets, City A.M. reported.
* The Central Bank of Jordan said the local units of Lebanese lenders Bank Audi SAL and BLOM BANK SAL are financially sound and only "marginally impacted" by the economic crisis in Lebanon, adding that there are no material risks on the safety of depositors' funds in the banks, Reuters reported, citing state media.
* The Jordanian parliamentary committee on economy and investment passed a draft law on the regulation of insurance business, Middle East Insurance Review reported, citing Al Rai.
* The Insurance Federation of Egypt has established a risk management department that will support insurers' efforts to renew reinsurance agreements and seek high credit ratings from international rating agencies, Middle East Insurance Review wrote.
* Mohammed Omran, chairman of Egypt's Financial Supervisory Authority, has issued a decision to create the first committee, chaired by Tariq Fahmi, to oversee the election of the board of directors of Egyptian Union for Finance Leasing, Al Masry Al Youm reported.
* Algeria has appointed a new government and kept some officials in their posts, including Finance Minister Abderrahmane Raouia, Reuters reported.
* Banque Internationale Arabe de Tunisie SA completed the issuance of a 45-million-dinar subordinated bond, Il Boursa reported.
EAST AND WEST AFRICA
* The acquisition of struggling Kenyan lender Jamii Bora Bank Ltd. by Commercial Bank of Africa is now uncertain following the completion of the latter's merger with NIC Group PLC, Business Daily Africa reported, citing John Gachora, CEO of the combined entity, NCBA Group Plc. Commercial Bank of Africa offered to buy out Jamii Bora Bank prior to its merger with NIC Group.
* John Gachora, CEO of Kenyan bank NCBA Group, called on Kenya's central bank to boost minimum capital requirements for lenders by as much as tenfold to 10 billion shillings to force consolidation and reduce the country's 40 commercial banks to less than 15, Bloomberg News reported. Efforts by Kenya's National Treasury to increase capital requirements have been opposed by the central bank and lawmakers since 2015 over fears that the rules could pressure smaller lenders and slow lending, the news agency noted.
* Separately, Gachora said NCBA Group's
* Kenya's government intends to restructure debt stocks by refinancing or substituting commercial loans with cheaper alternatives from development financiers or friendly countries, Reuters reported, citing an opinion piece by acting Finance Minister Ukur Yatani on Daily Nation.
* Kenya Deposit Insurance Corp. CEO Mohamud Mohamud said the agency and the central bank will boost their supervision of lenders to address any problems and prevent them from failing, The Star reported.
* United Bank for Africa PLC named Chiugo Ndubuisi group executive director and group COO. The Nigerian lender also appointed Oliver Alawuba CEO of UBA Africa, replacing Victor Osadolor, who will retire from the group's board, and Abdoul-Aziz Dia executive director for treasury and international banking, while the board confirmed Chukwuma Nweke's appointment as group executive director for retail and payments.
* Nigeria's National Insurance Commission has extended the deadline for local insurers to meet higher minimum capital requirements by six months to the end of 2020 from the original deadline of June 30, Middle East Insurance Review reported, citing a circular from the commission.
* Nigeria's Securities and Exchange Commission will prioritize the development of an efficient trading market for derivatives in 2020, The Punch reported, citing the commission's acting director-general, Mary Uduk.
CENTRAL AND SOUTHERN AFRICA
* South Africa's Absa Group Ltd. named former central bank Deputy Governor Aaron Daniel Mminele CEO of the group and unit Absa Bank Ltd., effective Jan. 15. Mminele will replace René van Wyk, who has been interim CEO following the retirement of Maria Ramos in February 2019.
* Angola's state-owned Banco de Poupança e Crédito SA — one of two leading lenders ordered to recapitalize by the central bank — said it will start legal proceedings to recover nonperforming loans after recovering just 4.2% of its total credit portfolio in repayments last year, Jornal de Angola reported, citing a statement by the lender. The bank said it was also negotiating the transfer of about 80% of its bad loans to Recredit – Gestão de Activos SA, a company set up to manage the banking systems' troubled assets, adding that two recapitalization plans had so far proved insufficient and noting a steady rise in credit provisions equivalent to 92% of the credit portfolio that hampers new lending. It concluded that managers had "confirmed the need for an additional capital injection by shareholders."
* Angola began letting oil companies sell dollars directly to commercial banks, without intermediation from the central bank, which analysts said was likely to allow the market to establish more accurate exchange rates, according to Angop.
* Russian lender VTB Bank PJSC has filed suit against a state-owned Mozambican company to which its lent $535 million as part of a project that became embroiled in a $2 billion corruption scandal, Reuters reported, citing documents filed with the U.K.'s High Court. The documents name the defendants as the state of Mozambique and state-owned Mozambique Asset Management and say the case centers on "general commercial contracts and arrangement." In October 2019, the deputy head of the legal department at VTB Capital said the Mozambique Asset Management loan represented a "significant exposure" and that it expected the credit to be paid back.
* Following the approval of IMF programs for the Republic of Congo in July 2019 and Equatorial Guinea in December 2019, S&P Global Ratings said it expects other member states of the Economic and Monetary Union of Central Africa to negotiate two-year extensions to their IMF programs due to end in 2021.
* Fidelity Life Assurance of Zimbabwe Ltd said it is still in talks involving a potential restructuring of its capital structure through the issuance of shares via a rights offer.
IN OTHER PARTS OF THE WORLD
Asia-Pacific: AMTD eyes Singapore digital bank license; India revises urban coop bank rules
Europe: Commerzbank to raise Comdirect stake; Gibraltar bank levy; Danske fine estimate
Latin America: Caixa Seguridade's IPO, new elections in Bolivia
North America: Lawyer-less suit vs. Schwab/TD Ameritrade merger nixed; Dallas de novo rising
Global Insurance: Australia bushfire insurance losses; Molina deal; Coverys startup
Erin Tanchico, Henni Abdelghani, Sophie Davies, Pádraig Belton and Helen Popper contributed to this report.
The Daily Dose Middle East and Africa has an editorial deadline of 4 a.m. London time. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.
This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.