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’Sovereigns of fortune (a debtor’s prison break)
In 2008-2009, a sovereign crack commando unit was sent to debtor’s prison by a bond vigilante court for a crime they didn’t commit.
(Well, actually, private-sector balance sheet losses, exchange rate collapse,
Backstop Bahrain
Thursday’s political risk datapoint:
DIFC – Dubai, May 26, 2011 — Moody’s Investors Service has today downgraded Bahrain’s government bond ratings by one notch to Baa1 from A3, and assigned a negative outlook to the rating.
Hello to bondholders, Dubai to banks
Or, what happens when an autocratic put and bad debts collide?
In which FT Alphaville wonders if one of 2011′s greatest stunts in defying credit gravity (charts via Exotix)…
…is on the verge of running into trouble.
Remember that other sovereign crisis?
It seems there’s been some further developments in the sorry saga of the Palm Island state on Thursday.
According to Reuters sources, Dubai Group — a unit of the Dubai Holdings conglomerate owned by Dubai,
Dubai: It’s a ‘frontier market’ for a reason
Kudos to Zawya Dow Jones for keeping an eye on an evolving legal dispute between Dubai Islamic Bank (DIB) and four businessmen.
Proponents and practitioners of Sharia-compliant finance are fond of trumpeting the safety,
Dubai World and creditors agree on debt
Fresh off the wires – some (rare) good news.
Dubai World has agreed — “in principle” — a deal with its creditors to restructure $24bn of debt.
Full statement below:
Dubai World Agrees Headline Economic Terms in Principle with Coordinating Committee
Dubai,
Dubai repays $980m Nakheel bond on time
Finally, some good news:
May 13 (Reuters) – Dubai repaid a $980 million Islamic bond issued by developer Nakheel while another state-owned firm said it was confident of refinancing an upcoming loan as it digs out from a massive debt burden.
CDS report: Dubai, Greece push spreads tighter
After a weak start, European credit indices finished the day tighter as encouraging news on sovereigns supported spreads. The Markit iTraxx Europe index was trading around 78bp, about 1.5bp tighter than yesterday’s close,
‘Internal Dubai government resources’ to the rescue
Breaking — Dubai’s palm-shaped islands would appear to be safe once more.
The emirate’s government said on Thursday it would stump up cash for the firm’s debt restructuring — including the liabilities of property developer Nakheel — to the tune of $9.5bn.
Dubai World: the restructuring that keeps on giving
The debt shenanigans at Dubai World are keeping analysts, investors and the financial media quite busy.
In the latest issue of Moody’s Weekly Credit Outlook, the rating agency estimates that Dubai World’s UAE-based creditor banks “would incur losses amounting to only around 9 per cent of their capitalization as of year-end 2009″
Dubai World debt: to pay or not to pay?
Further developments in the Dubai World restructuring saga.
The Dubai government is no longer seeking preferred creditor status, according to Reuters. If true, that removes a key sticking point in the $22bn debt work-out discussions.
CDS report: Indices move wider as sentiment dips
Markit’s Gavan Nolan wrote this CDS report
Credit was playing catch up with equities today after the latter market rallied in response to strong US economic data, solid earnings and a lull in the sovereign situation.
60 cent
Fresh jitters in Dubai on Monday morning.
RTRS-DUBAI FIVE-YEAR CREDIT DEFAULT SWAPS RISE TO 651 BPS FROM 627 AT FRIDAY CLOSE-CMA
RTRS-DUBAI FIVE-YEAR CDS RISE ABOVE NOV 2009 LEVELS TO HIGHEST SINCE MARCH 2009-CMA
RTRS-NAKHEEL’S 2011 ISLAMIC BOND FALLS 3.5 POINTS TO 50,
Dubai CDS, deja vu
Something’s up in Dubai, and we were hearing on Friday that it just might have something to do with our favourite palm-tree island maker, Dubai World’s Nakheel.
As Reuters reported earlier, Dubai CDS has gone through the roof again:
Deference, Dubai style
From Bloomberg on Monday afternoon:
Dubai’s Sheikh Mohammed bin Rashid Al Maktoum opened the world’s tallest tower today and renamed the building Burj Khalifa after Sheikh Khalifa bin Zayed Al Nahyan,
Sovereign debt crises 2010, an RBS sapling
What is the `Tree of Truth’?
According to RBS, it is a Binary Recursive Tree Approach aimed at selecting explanatory variables and critical threshold levels that best discriminate between sovereign debt crisis and non-sovereign debt crisis states.
Professional athletes and their money, Ponzi edition
In March 2009, FT Alphaville riffed on the theme of the generally poor financial and investment decisions made by professional athletes.
By the end of the year, another — although not unrelated — trend had emerged:
Dubai is worth more than you think
That is, Dubai EFS crude — rather than the emirate itself — is worth more than you think.
As Morgan Stanley highlighted in its commodity outlook for 2010, Dubai crude, which historically traded at a discount to Brent crude due to its heavier and sour quality,
Please have confidence in us!
George Papaconstantinou had a busy day on Wednesday.
A whirlwind London PR offensive by the Greek finance minister to help revive confidence in the fiscally beleaguered eurozone state, included stopovers at a plethora of media outlets — the FT,
Snap news
Breaking pre-market news on Thursday,
- ECB said to start consulting banks, investors on collateral – Bloomberg.
- Dubai officials in confidence building UK, US trip – Reuters.
- US says Credit Suisse evaded sanctions – Reuters,
CDS report: Greece and Dubai Continue to Drive Markets
Otis Casey of Markit wrote this CDS report
Early trading saw the Markit iTraxx indices and stock markets higher as investors were heartened to see the last minute Abu Dhabi bailout of Dubai. The Markit iTraxx Europe index tightened by more than 2 bp to 79.49 bp. The Markit iTraxx HiVol was 2 bp tighter at 118.33 bp while the Markit iTraxx Crossover finished at 476.30 bp,
S&P and Fitch to Dubai: ‘not so fast…’
Ratings agencies Standard & Poor’s and Fitch have issued responses to Dubai’s surprise repayment of the now infamous $4.1bn Nakheel sukuk.
And just in case the emirate was labouring under any misconceptions,
Fund management flop
Oh dear. Shares in Gartmore are trading below their revised flotation price on Monday morning.
Recall, that Gartmore was forced to cut the price of its £676m IPO on Friday to 220p per share, down almost 16% from the mid-point of its target price range.
Statement From Sheikh Ahmad Bin Saeed Al Maktoum
14 December 2009
The Government of Dubai, acting through the Supreme Fiscal Committee (“SFC”), today announces a set of actions in relation to Dubai World:
Sheikh Ahmad Bin Saeed Al Maktoum, Chairman of the Dubai Supreme Fiscal Committee said:
Nakheel says it will pay/ Abu Dhabi rides to rescue
From Nasdaq Dubai on Monday morning:
14 Dec 2009 – 09:05:07 Nakheel Development Limited – Announcement Nakheel confirms that it will honour all obligations related to the 2009 Nakheel Development Limited Sukuk using funds that will be provided by the Dubai Financial Support Fund.
Nakheel bondholders are having a ‘temper tantrum’
The UAE’s English language newspaper The National put out a snippy editorial on Wednesday, lecturing about the perils of moral hazard and the like.
In short, it told Nakheel bondholders to get over themselves,
StanChart downplays Dubai fears
Standard Chartered, the UK emerging markets bank, played down its exposure to the financial crisis in Dubai on Wednesday as it announced profits were set to hit record levels. The bank’s shares came under pressure this month after news that it has about $1bn of exposure to Dubai World,
The Palm is NOT sinking, says Nakheel
While we’d heard rumours from industry sources that the Palm Jumeirah might be sinking into the seabed, FT Alphaville never had any evidence to support them.
Nor could we corroborate rumours that questionable building standards in Dubai had led to cracks and window damage in many of the emirate’s new property developments.