MENA Daily Fixed Income Report - 2 June

Transcription

1. MENA Daily Fixed Income Report – 2 June 2020 Kuwait Financial Centre “Markaz” News Updates Saudi Arabia to Inject $13.3 Billion Into Banking System – Saudi Arabia’s central bank will pump 50 billion riyals ($13.3 billion) into the kingdom’s banking system to help manage the fallout of the coronavirus pandemic and drop in oil prices. The move by the Saudi Arabian Monetary Authority will support financial stability and boost credit facilities to the private sector, it said in a statement on Monday. It’s aimed at helping banks amend and restructure loans without additional fees and support private sector employment. In March, the regulator urged banks to put in place a lending program for at least six months to “assist in maintaining employment levels,” according to a document sent by the regulator to lenders and seen by Bloomberg. It had previously unveiled a 50-billion riyal program to help private businesses in the country. (Source: Bloomberg) Saudi Reserves Fall Again After Transfer to Sovereign Fund – Saudi Arabia’s reserves fell for a second month after the kingdom said it had transferred 150 billion riyals ($40 billion) to finance an investment spree by its sovereign wealth fund. Net foreign assets in the Arab world’s biggest economy declined by $20.9 billion in April, a decrease of 4.5% from the previous month, according to data released Sunday by the Saudi Arabian Monetary Authority. The fall follows a $27 billion plunge in March, when the stockpile shrank at the fastest pace in at least two decades. “We’re still in a comfortable situation,” the central bank’s governor, Ahmed Alkholifey, said in an interview with Al-Arabiya television on Monday. The change in the level of reserves between the end of May and the end of April is “not significant” and the stockpile is still enough to cover more than 40 months of imports, he said. (Source: Bloomberg) Sharjah Raises 2 Billion Dirhams Via Sukuk Trust Certificates – Sharjah, a sheikhdom in the United Arab Emirates, raised 2 billion dirhams from one-year sukuk trust certificates, sole lead manager and arranger Bank of Sharjah says in a statement. The certificates, issued on May 19, pay a profit rate of 1.5%, and mature on May 19, 2021. Proceeds to be used to support the Sharjah economy, corporates, SMEs, individuals and banking sector during the coronavirus crisis. (Source: Bloomberg) Gulf currency pegs to remain despite oil price slump, S&P says – The six nations of the Gulf Cooperation Council will maintain their pegged currencies despite a fall in oil prices, S&P Global Ratings said on Monday. Kuwait, Qatar, the United Arab Emirates and Saudi Arabia have strong levels of reserves to weather shocks, while Bahrain and Oman have a lower level of external liquid assets, S&P said. But the ratings agency believes Bahrain and Oman's wealthier neighbours would provide financial support in times of stress if needed, similar to a $10 billion aid package pledged to Bahrain by Kuwait, Saudi Arabia and the UAE in 2018. "We note, however, that a currency devaluation would increase the local currency value of U.S. dollar-priced oil- and gas-related revenues. This would improve government fiscal balances as long as governments are able to contain their spending, which may not be so easy given the inflationary aspects of such a devaluation," it said. (Source: Zawya) GCC Sovereign Yields Sovereigns Maturity Sovereign Ratings Price ∆ (YTD %) 2.59 Yield % Abu Dhabi 2027 1.95 Abu Dhabi 2047 3.12 Bahrain 2024 4.89 Bahrain 2029 6.23 Bahrain 2047 7.19 Dubai 2023 Dubai 2029 Sovereigns Maturity Price ∆ (YTD %) 1.13 Yield % 1.21 KSA 2029 2.55 1.45 KSA A1 A-u A KSA 2049 3.89 -0.84 UAE Aa2 NR NR -11.88 Oman 2025 6.04 -8.99 AA AA Oman 2029 8.23 -18.48 Abu Dhabi Aa2 -15.61 Qatar Aa3 AA- AA- 1.68 1.27 Oman 2048 8.88 -22.94 3.27 -1.84 Qatar 2024 1.60 1.44 Bahrain B2u B+ BB- Oman Ba2 BB- BB Qatar 2028 2.26 0.88 Kuwait 2027 1.81 2.56 Qatar 2049 3.36 1.86 Bonds and Sukuk Indices Yield % Duration (yrs) 1D ∆ (%) YTD ∆ (%) Bloomberg GCC FI Index 3.50 7.32 -0.15 -0.58 S&P MENA Bond and Sukuk Index 2.76 NA -0.08 1.99 Bloomberg Emerging Markets USD Index 5.06 6.26 0.03 -2.85 Bloomberg Global Aggregate Index 1.01 7.33 0.33 2.08 Index Name Interbank Rates (%) 3 Months 02/06/2020 31/12/2019 1.6875 2.7500 1.0800 2.2314 6 Months 02/06/2020 31/12/2019 1.9375 2.9375 1.1457 2.2557 12 Months 02/06/2020 31/12/2019 2.1875 3.1875 1.1800 2.3071 BHIBOR QATAR 2.2167 1.1150 2.6667 2.2500 2.2833 1.1750 2.7000 2.3500 2.4917 1.3500 2.8333 2.5333 AEIBOR EURIBOR 0.7956 -0.3070 2.2086 -0.3830 1.1247 -0.1580 2.1914 -0.3240 1.2140 -0.0850 2.2900 -0.2490 1.9084 0.5098 USD Swap Rates 1-Year 2-Year 5-Year 7-Year 10-Year 30-Year YTD ∆ (%) -83.6 -85.3 -79.2 -72.5 -65.0 -53.2 US Treasuries 2-Year 5-Year 10-Year 30-Year 1.9121 0.6735 1.9963 Currencies 1D ∆ (bps) -0.21 -0.23 -0.03 0.45 1.22 4.24 KWD SAR BHD QAR OMR AED USD 0.3082 3.7548 0.3776 3.6414 0.3850 3.6731 UK Guilts Yield % 0.16 0.31 0.67 1.46 AA -5.72 1.11 Yield % 0.2906 0.2490 0.3592 0.4943 0.6628 0.9798 Fitch 1.95 1.05 0.3440 AA- 2025 2022 LIBOR Aa2 KSA Kuwait KIBOR SAIBOR Moody’s S&P Kuwait 1D ∆ (%) 0.01 0.00 -0.15 -1.27 Yield % -0.02 0.03 0.23 0.62 1D ∆ (bps) 0.1623 0.0080 0.0000 0.0000 0.0000 0.0000 YTD ∆ (%) -1.66 -0.06 -0.06 0.01 0.01 0.00 German Bunds 1D ∆ (%) -0.09 -0.23 -0.64 -1.18 Yield % -0.65 -0.64 -0.44 0.07 1D ∆ (%) -0.01 -0.09 -0.44 -2.36 Egypt B2 B B+ Lebanon Ca SD RD Jordan B1 B+ BB- Turkey B1 B+u BB- Tunisia B2 NR B BBB- BBB- US Aaa AA+u AAA UK Aa2 AAu AA- China A1 A+ A+ Morocco Ba1 USD 5Yr CDS 2-Jun 2020 31-Dec 2019 Kuwait 84.630 36.700 KSA 135.690 56.915 Abu Dhabi 91.110 36.090 Dubai 208.290 91.005 Qatar 91.160 36.705 Bahrain 401.700 175.995 Oman 606.750 234.400 Iraq 772.9600 383.680 Egypt 545.690 Morocco 142.360 91.435 Turkey 531.300 282.130 US 14.470 10.810 UK 28.080 16.210 China 52.470 31.205 Japan 20.330 21.042 Germany 17.350 7.080 France 28.910 16.130 277.420 Source: Bloomberg This report has been prepared and issued by Kuwait Financial Centre K.P.S.C. (Markaz) , which is regulated by the Capital Markets Authority and the Central Bank of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of this report is strictly prohibited. This report can not be published. A number of sources which include Bloomberg, Zawya, and daily newspapers were utilized in the creation of this report.