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NCB, Riyad Bank in merger talks; Rwanda ups capital requirements for banks

GULF COOPERATION COUNCIL

* National Commercial Bank said it is in initial merger discussions with Saudi Arabian peer Riyad Bank. The potential deal will pave the way for the creation of a new lender with $182 billion in assets, becoming the third-largest bank in the Gulf, Bloomberg News noted.

* The proposed three-way merger between United Arab Emirates-based Abu Dhabi Commercial Bank PJSC, Union National Bank PJSC and Al Hilal Bank PJSC could result in roughly 1,000 job cuts, insiders told Bloomberg News. Talks are reportedly at an advanced stage, and the lenders are conducting due diligence and are sorting out matters such as valuation.

* The government of Sharjah in the UAE will pump up to 1.9 billion dirhams in Invest Bank PSC under a two-stage process. Invest Bank said the government has committed to acquire 1,592,857,14 new shares in the lender, representing 50.07% of its total issued capital, and will also subscribe in full to the shares offered to it as part of a rights issue to be undertaken by the lender in 2019 as well as any new shares offered to other shareholders.

* Abdulaziz Bin Hassan, CEO of Credit Suisse Group AG's Saudi Arabian business, is said to have resigned. He is likely to leave in 2019, insiders told Arabian Business.

* Al Fujairah National Insurance Co. CEO Antoine Maalouli said the company is expanding locally across the UAE, Al Bayan reported. He also said that insurance sector's growth is in the UAE is promising over the next few years.

* Abu Dhabi Islamic Bank PJSC is awaiting regulatory approval to appoint Mazin Manaa CEO.

* UAE-based Ajman Bank PJSC will propose to carry out a sukuk issuance program totaling $1.5 billion, Reuters wrote.

* The UAE Commodities and Securities Authority has suggested that local stock brokers merge to create strong broker firms amid the current market situation, Al Bayan reported. The proposal comes as three companies suspended their operations.

* Barwa Bank QSC's shareholders approved the proposed tie-up between the lender and International Bank of Qatar QSC, The Peninsula wrote. Shareholders also approved a plan to increase Barwa Bank's authorized and paid-up capital to approximately 5.23 billion riyals from 4 billion riyals and 3 billion riyals, respectively.

* Commercial Bank of Kuwait KPSC said it has received regulatory nod to appoint Sahar Abdulaziz al-Rumaih deputy CEO of corporate banking and international banking services divisions.

* Oman International Development & Investment Co. SAOG said it has increased its stake in National Finance Co. SAOG to 34.6%.

* Oman-based Bank Sohar SAOG has rebranded as Sohar International, according to Trade Arabia.

REST OF MIDDLE EAST AND NORTH AFRICA

* Israel Prime Minister Benjamin Netanyahu's coalition decided to dissolve the parliament and called snap elections likely to take place April 9, 2019, amid multiple corruption allegations against Netanyahu. The elections were originally scheduled to be held in November 2019, though no coalition in the last three decades has served its full term in Israel, Bloomberg News noted.

* New Bank of Israel Governor Amir Yaron said normalizing monetary policy is the main challenge facing the central bank, Reuters wrote. His comment comes after policymakers on Nov. 26 voted to raise the interest rate by 0.15 percentage point to 0.25%, the first rate hike since May 2011.

* Algeria, Ghana, Libya, Morocco and Togo joined the Asian Infrastructure Investment Bank, a multilateral bank founded by China in 2015, Agence Ecofin said. China holds 30% of the institution's capital and 26% of its voting rights.

EAST AND WEST AFRICA

* The National Bank of Rwanda raised the paid-up capital requirement for commercial banks to 20 billion Rwandan francs, up from 5 billion francs currently, and gave lenders up to five years to comply with the new rules, Bloomberg News reported, citing central bank Governor John Rwangombwa. The regulator also raised the minimum capital requirements for insurers, to 3 billion francs for general insurers and to 2 billion francs for life insurance firms, and gave them transition periods of three years and two years, respectively, The New Times wrote. Rwangombwa said the central bank will transition to a price-based monetary policy framework from the current monetary-targeting regime to better accommodate the country's needs.

* Portugal's Caixa Geral de Depósitos SA plans to sell its 59% stake in Cape Verde-based lender Banco Comercial do Atlântico SA while maintaining its 71% stake in Banco Interatlântico, CEO Paulo Macedo was quoted as saying in Praia, the official Lusa news agency and Expresso Das Ilhas reported. He told reporters that the divestment process had been launched a year ago as part of a wider reorganization of the bank's international operations.

* Fitch Ratings lowered Diamond Bank PLC's long-term issuer default rating to CC from CCC and its viability rating to "cc" from "ccc," among other downgrades, and placed the ratings on Rating Watch Evolving. The agency also placed Nigerian peer Access Bank PLC's ratings, including its B long-term issuer default rating and "b" viability rating, on Rating Watch Negative. The ratings actions follow the lenders' agreement to merge.

* South African telecommunications firm MTN Group made a $53 million payment to resolve a dispute with the Central Bank of Nigeria over the company's alleged illegal transfer of roughly $8.1 billion in funds, Reuters wrote.

* A.M. Best affirmed the financial strength rating of A (Excellent) and the long-term issuer credit rating of "a" of African Reinsurance Corp. The outlook of these credit ratings is stable.

CENTRAL AND SOUTHERN AFRICA

* Namibian Finance Minister Calle Schlettwein told Bloomberg News that the government is considering revising the country's 25-year-old peg to the South African rand or building a new path for the Namibian dollar, in a bid to address the economic impact stemming from the rand's volatility. The rand has weakened more than 14% against the dollar this year — making it the fifth-worst performing emerging-market currency — amid trade tensions between the U.S. and China, a major trading partner of South Africa, the report noted.

* The Democratic Republic of the Congo's electoral commission said the country's presidential election, due to take place Dec. 30, will be postponed until March next year in three cities, citing insecurity and an Ebola outbreak, BBC News reported. The decision to postpone elections in the cities of Beni, Butembo and Yumbi, which are known as opposition strongholds, could stir up political tensions ahead of the ballot, Reuters noted.

* Angola's central bank has extended for 90 days its intervention Banco Angolano de Negócios e Comércio SA to give the troubled lender more time to bolster its solvency ratios, state news agency Angop reported. The monetary authority extended the term of the provisional administrators Mário Eglicénio Ferreira Baptista do Nascimento and João Fernando Quiuma, but said José Aires Vaz do Rosário would end his term as an administrator at the bank, which is controlled by Kundi Paihama, a former defense minister.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: Mizuho to launch cryptocurrency in 2019; Allahabad Bank to raise 8B rupees

Latin America: Grupo Wiese agrees to sell Sura AM stake; Colombia maintains key rate

Global Insurance: Indonesia tsunami death toll reaches 430; Stackhouse in talks with suitors

Sheryl Obejera, Henni Abdelghani, Padraig 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.