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Downturn in African insurance; S&P grim on GCC

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Downturn in African insurance; S&P grim on GCC

Downturnin African insurance: Lower commodity prices andpolitical uncertainty may end two decades of uninterrupted growth forsub-Saharan Africa's insurance industry, according to A.M. Best, Agence Ecofin reports, noting that according to Swiss Re, the Africaninsurance market contracted 8.5% in 2015.

* The African Union's commissioner for trade andindustry, Fatima Acyl, said Africa's Continental Free Trade Area will come intoeffect next year, Financial Afrik says.

* CreditSuisse Group AG named Cathal Deasy of M&A for Europe, the MiddleEast and Africa, effective October, Bloomberg News reports. Deasy, who mostrecently served as head of natural resources M&A for , will be based in theSwiss bank's London office.

MIDDLE EAST AND NORTH AFRICA

S&P grim on GCC:S&P Global Ratings on Wednesday published its Middle East and North AfricaSovereign Rating Trends Mid-Year 2016 report, saying overall sovereigncreditworthiness in the MENA region has continued to deteriorate, resulting inratings downgrades on Saudi Arabia, Oman and Bahrain over the first half, basedmainly on the fiscal and external effects of lower oil prices. S&P warnedthat Gulf Cooperation Council member countries continue to face unprecedentedfiscal financing needs, expected to exceed $100 billion in 2016 alone.

* The Central Bank of the UAE's credit sentiment survey revealedthat growth in demand for business credit softened in the second quarter,particularly in Dubai. The central bank's survey also showed further tighteningin credit standards, suggesting a higher degree of risk aversion in extendingloans, especially to small and medium-sized enterprises.

* Moody's said Iraq's deal with the IMF will lower thecountry's fiscal and balance-of-payments challenges, CPI Financial reports.The rating agency said the agreement is credit positive for Iraq because itwill improve liquidity at a time when the country's economy is suffering. TheIMF executive board approved a $5.34 billion standby arrangement with Iraqwhich will be disbursed in 13 tranches over a three-year period through June2019.

* Investors expect weaker profits from Abu Dhabi lenders inthe second quarter due to the drop in oil prices, Reuters says.However, banking stocks in the Gulf region mostly rallied on Wednesdayfollowing earnings reports by Saudi Arabian and Qatari banks that fared betterthan analyst expectations.

* Abu DhabiIslamic Bank PJSC yesterday reportedsecond-quarter group net profit of 507.5 million UAE dirhams, compared to 502.6million dirhams in the year-ago period. For the first half, group net profitrose 3.8% on a yearly basis to 989.5 million dirhams.

* QatarInsurance Co. SAQ unit Qatar Reinsurance Co. Ltd. promoted head of operationsSteve Tidd to COO.Qatar Re also named Andrew Smith chief risk officer and Adam Young head ofcompliance.

* Saudi Arabia tapped Bank of China Ltd., BNP Paribas SA,Deutsche Bank AG, Goldman Sachs Group Inc., Mitsubishi UFJ Financial Group Inc.and Morgan Stanley to arrange its first international bond sale targeted atplugging a budget hole caused by the slump in oil prices, insiders tellBloomberg News.

* Loans to customers of Egyptian banks increased by13.2 billion pounds in April, according to data from the central bank, Daily News Egypt reports. In April, 74.8% of loans granted by banks went tothe private sector.

* Adnan Mazarei, deputy director of the IMF's MiddleEast and Central Asia department, said Algeria does not need financial supportfrom the fund, El Watan reports. Mazarei predicted that the average price of oilwould hover around $50 per barrel until 2017.

* Groupe de laBanque africaine de développement, or the African Development Bank,will lend Morocco $157 million to help boost the country's financial sector,Morocco World News reports,citing a statementfrom the bank.

EAST AND WEST AFRICA

Fitch cuts Kenya:Fitch Ratings yesterday downgraded Kenya's long-term local-currency issuerdefault rating to B+ from BB-, with a negative outlook. The rating agency said thedowngrade was influenced by the trend of increasing CapEx and delayed fiscalconsolidation.

* Meanwhile, Akin Majekodunmi, vice president and seniorsub-Saharan Africa banking analyst at Moody's Financial Institutions Group,warned that Kenya's central bank lacks the capacity to deal with a potentialcrisis in the banking sector, BusinessDaily Africa writes.Majekodunmi urged the central bank to boost its capacity to supervise lendersand deal with potential bank failures.

* Côte d'Ivoire saw a 25% year-over-year increasein investment in the first half to 219 billion CFA francs, Agence Ecofin reports.

* At 266 billion Mauritian rupees, public debt hassurpassed 65% of the country's GDP, L'Express says, noting that this is unusual for Mauritius which hashistorically maintained low levels of public debt.

CENTRAL AND SOUTHERN AFRICA

2 Zambian lenders urged tomerge: Zambian Finance Minister Alexander Chikwanda urged andZambia National Commercial BankPlc to merge, Zambia DailyMail writes.

* FirstRandLtd. unit FirstNational Bank Zambia Ltd. appointed Leonard Haynes CEO, Reuters reports.Haynes, who was formerly CEO of First National Bank of Namibia Ltd., will succeed JohanMaree, who will move to another role within FirstRand.

* African BankInvestments Ltd. repurchased $325 million in bonds in a tenderoffer in respect of notes issued under its $6 billion euro medium-term noteprogram and in open market repurchases concluded before the launch of thetender offer.

* Authorities uncovered a 12-year-old embezzlingnetwork at GroupeBPCE unit BanqueInternationale du Cameroun Pour l'Epargne et le Crédit, AgenceEcofin reports. More than €75 million was siphoned off throughovercharges and fictitious invoices, according to the authorities. Thegovernment of Cameroon holds 17.5% of the bank's shares.

* Novo Jornal reportsthat commercial banks in Angola are involved in foreign-currency trading on theblack market.

* La Régionale d'Epargne et de Crédit microfinancebank, which has 34 branches in Cameroon, recently opened its first Gabon branchin Libreville, Financial Afrik reports.

IN OTHER PARTS OF THE WORLD

Asia-Pacific:FDIC may have covered up hackingattempts; Moody's keeps Taiwan's rating

Europe:Banks reassured over capitalbuffers; LSE-Deutsche Börse merger protest; Spanish banks get relief

LatinAmerica: BNDES reviewsinfrastructure financing plans; Fitch downgrades Bolivia

NorthAmerica: JPMorgan releasesearnings; Dimon gets flak in UK for Brexit pessimism

NorthAmerica Insurance: Analysts warnof Q2 cat losses impact; Florida to hold hearings on large rate hikerequests

S&P Global Ratingsand S&P Global Market Intelligence are owned by S&P Global Inc.

Xana Kakoty, Sarah Raslan, PádraigBelton and Mariana Aldano contributed to this report.

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