There was a palpable feeling of relief at Nasdaq Dubai this week with the announcement that, at last, after more than five years and several false starts, it had a new listing.
Bank of London and the Middle East (BLME), the biggest independent Islamic banking business in Europe, intends to list its shares next month, with a chunky market capitalisation of about US$500 million, making it one of the bigger stocks on the exchange.
It is good news for ND. The last real listing, of the jewellery group Damas, came in July 2008, which with hindsight was awful timing. Just before that there was the interiors group Depa, then you have to go all the way back to DP World in December 2007.
None of these have traded particularly well on the exchange (although in the case of since-delisted Damas the poor performance was for reasons mainly outside ND’s control).
But there was a feeling that, with global indexes (including the UAE 20 Index, which partly reflects the state of health of the ND market) heading upwards again, BLME was an opportunity to start over, maybe even catch the rising tide of world equities and become a proper exchange again.
All that is possible, and anybody involved with the Dubai financial services industry must hope that it is so and wish ND well.
But one swallow doesn’t make a summer.
In the case of BLME, there must be reasonable doubt that the issue will be swallowed at all, with the risk it might just languish on ND, unloved and illiquid, just like the other seven stocks there (with the partial exception of DP World.)
It must be said there is nothing in BLME’s fundamentals to cause that concern. The management looks sound, as are the financials. The strategy of “bridging the gap” in Islamic business between Europe and the Gulf also has potential, as the Sharia-compliant world moves up a gear, and Dubai seeks to be its global hub. All that is good.
The valuation also seems reasonable. Whether measured by the criterion of previous (private) share trades by its mainly Kuwaiti shareholders, or as a ratio to book value, the price of $2.57 per share does not seem expensive.
Rather, it is the circumstances of the listing – at least as explained by management – that causes some concern. Some of BLME’s original shareholders, going back to when it was sponsored by Kuwait’s Boubyan Bank in 2006, obviously want to get out. The estimate was between 5 and 15 per cent of the total, with an unspecified percentage also looking to buy.
That might ensure a healthy few hours trading on the first day, but what then? Unless BLME can tap into a new flow of Islamic products from Dubai (which is a possibility) there seems little to attract UAE investors into the stock.
Of course, its listing might tempt Kuwaiti, and other Gulf or international investors in, but that is by no means a certainty, given the regional dynamics.
So ND would be unwise to proclaim the end of the doldrums just yet, at least on the evidence of the BLME listing. Exchange insiders say there are others planning real initial public offerings to raise new money (unlike BLME), and that could be true.
But there have been so many false dawns at ND over the past few years that it would be premature to herald the start of a new era. Let’s wait and see the identities of the corporates, their prospectuses and financials, and above all get their shares trading, before that.
Meanwhile, ND has got quite a lot of other issues to be getting on with. We still await implementation of the plans announced earlier this year to provide a market for sukuk trading, and to become a platform for financing SME business in the emirate.
And at ND’s back – indeed looming over the whole DIFC – is Abu Dhabi’s plan to set up its own financial free zone. Competitive or cooperative, it’s an issue that has to be dealt with.
So, well done ND, and good luck BLME. But let’s just hold the celebrations awhile.
fkane@thenational.ae
UAE currency: the story behind the money in your pockets
New UK refugee system
- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
Coffee: black death or elixir of life?
It is among the greatest health debates of our time; splashed across newspapers with contradicting headlines - is coffee good for you or not?
Depending on what you read, it is either a cancer-causing, sleep-depriving, stomach ulcer-inducing black death or the secret to long life, cutting the chance of stroke, diabetes and cancer.
The latest research - a study of 8,412 people across the UK who each underwent an MRI heart scan - is intended to put to bed (caffeine allowing) conflicting reports of the pros and cons of consumption.
The study, funded by the British Heart Foundation, contradicted previous findings that it stiffens arteries, putting pressure on the heart and increasing the likelihood of a heart attack or stroke, leading to warnings to cut down.
Numerous studies have recognised the benefits of coffee in cutting oral and esophageal cancer, the risk of a stroke and cirrhosis of the liver.
The benefits are often linked to biologically active compounds including caffeine, flavonoids, lignans, and other polyphenols, which benefit the body. These and othetr coffee compounds regulate genes involved in DNA repair, have anti-inflammatory properties and are associated with lower risk of insulin resistance, which is linked to type-2 diabetes.
But as doctors warn, too much of anything is inadvisable. The British Heart Foundation found the heaviest coffee drinkers in the study were most likely to be men who smoked and drank alcohol regularly.
Excessive amounts of coffee also unsettle the stomach causing or contributing to stomach ulcers. It also stains the teeth over time, hampers absorption of minerals and vitamins like zinc and iron.
It also raises blood pressure, which is largely problematic for people with existing conditions.
So the heaviest drinkers of the black stuff - some in the study had up to 25 cups per day - may want to rein it in.
Rory Reynolds
THE SPECS
Engine: 6.75-litre twin-turbocharged V12 petrol engine
Power: 420kW
Torque: 780Nm
Transmission: 8-speed automatic
Price: From Dh1,350,000
On sale: Available for preorder now
MATCH INFO
Manchester City 3
Danilo (16'), Bernardo Silva (34'), Fernandinho (72')
Brighton & Hove Albion 1
Ulloa (20')
more from Janine di Giovanni
Should late investors consider cryptocurrencies?
Wealth managers recommend late investors to have a balanced portfolio that typically includes traditional assets such as cash, government and corporate bonds, equities, commodities and commercial property.
They do not usually recommend investing in Bitcoin or other cryptocurrencies due to the risk and volatility associated with them.
“It has produced eye-watering returns for some, whereas others have lost substantially as this has all depended purely on timing and when the buy-in was. If someone still has about 20 to 25 years until retirement, there isn’t any need to take such risks,” Rupert Connor of Abacus Financial Consultant says.
He adds that if a person is interested in owning a business or growing a property portfolio to increase their retirement income, this can be encouraged provided they keep in mind the overall risk profile of these assets.
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Who is Mohammed Al Halbousi?
The new speaker of Iraq’s parliament Mohammed Al Halbousi is the youngest person ever to serve in the role.
The 37-year-old was born in Al Garmah in Anbar and studied civil engineering in Baghdad before going into business. His development company Al Hadeed undertook reconstruction contracts rebuilding parts of Fallujah’s infrastructure.
He entered parliament in 2014 and served as a member of the human rights and finance committees until 2017. In August last year he was appointed governor of Anbar, a role in which he has struggled to secure funding to provide services in the war-damaged province and to secure the withdrawal of Shia militias. He relinquished the post when he was sworn in as a member of parliament on September 3.
He is a member of the Al Hal Sunni-based political party and the Sunni-led Coalition of Iraqi Forces, which is Iraq’s largest Sunni alliance with 37 seats from the May 12 election.
He maintains good relations with former Prime Minister Nouri Al Maliki’s State of Law Coaliton, Hadi Al Amiri’s Badr Organisation and Iranian officials.
The biog
Name: Gul Raziq
From: Charsadda, Pakistan
Family: Wife and six children
Favourite holes at Al Ghazal: 15 and 8
Golf Handicap: 6
Childhood sport: cricket
Keep it fun and engaging
Stuart Ritchie, director of wealth advice at AES International, says children cannot learn something overnight, so it helps to have a fun routine that keeps them engaged and interested.
“I explain to my daughter that the money I draw from an ATM or the money on my bank card doesn’t just magically appear – it’s money I have earned from my job. I show her how this works by giving her little chores around the house so she can earn pocket money,” says Mr Ritchie.
His daughter is allowed to spend half of her pocket money, while the other half goes into a bank account. When this money hits a certain milestone, Mr Ritchie rewards his daughter with a small lump sum.
He also recommends books that teach the importance of money management for children, such as The Squirrel Manifesto by Ric Edelman and Jean Edelman.
The specs
Engine: 5.0-litre V8
Power: 480hp at 7,250rpm
Torque: 566Nm at 4,600rpm
Transmission: 10-speed auto
Fuel consumption: L/100km
Price: Dh306,495
On sale: now
Info
What: 11th edition of the Mubadala World Tennis Championship
When: December 27-29, 2018
Confirmed: men: Novak Djokovic, Rafael Nadal, Kevin Anderson, Dominic Thiem, Hyeon Chung, Karen Khachanov; women: Venus Williams
Tickets: www.ticketmaster.ae, Virgin megastores or call 800 86 823
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The biog:
Languages: Arabic, Farsi, Hindi, basic Russian
Favourite food: Pizza
Best food on the road: rice
Favourite colour: silver
Favourite bike: Gold Wing, Honda
Favourite biking destination: Canada
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
Bio:
Favourite Quote: Prophet Mohammad's quotes There is reward for kindness to every living thing and A good man treats women with honour
Favourite Hobby: Serving poor people
Favourite Book: The Alchemist by Paulo Coelho
Favourite food: Fish and vegetables
Favourite place to visit: London
The specs: 2019 GMC Yukon Denali
Price, base: Dh306,500
Engine: 6.2-litre V8
Transmission: 10-speed automatic
Power: 420hp @ 5,600rpm
Torque: 621Nm @ 4,100rpm
Fuel economy, combined: 12.9L / 100km
Frankenstein in Baghdad
Ahmed Saadawi
Penguin Press
