LONDON: The Saudi Real Estate Refinance Co. (SRC) said on Saturday it had agreed to buy SR750 million ($200 million) worth of mortgages from local banks and mortgage financing companies.
The agreements, signed during last week’s Financial Sector Conference in Riyadh, included deals with Banque Saudi Fransi and Saudi British Bank (SABB), SRC said in statements.
The company, a subsidiary of Saudi Arabia’s Public Investment Fund (PIF), aims to inject liquidity into the Saudi housing finance market by buying out mortgages.
“This announcement validates SRC’s purpose within a vibrant housing market, but for it to reach full potential we must ensure that there is improved supply of new homes whilst also making these homes affordable and accessible to more Saudi citizens,” SRC’s CEO Fabrice Susini said of the Banque Saudi Fransi deal.
“This agreement is a visible demonstration of how SRC makes further liquidity being available for the Saudi housing market which will ultimately make every Saudi citizen’s dream of owning a home a reality. That said, the agreement will further increase Banque Saudi Fransi’s ability to offer more (accessible) home buying solutions.”
David Dew, managing director of SABB, said: “This agreement will play a role in the development of the housing sector and the provision of sustainable solutions that will enable home ownership with ease. Housing finance is a central objective of Vision 2030, and with this initiative, SABB will be playing a central role on the development of the sector.”
The announcement comes shortly after SRC successfully completed sukuk, or Islamic bond, issuances of SR750 million, making it the first non-sovereign issuer in Saudi Arabia in 2019.
SRC, which was formed in 2017, aims to refinance 20 percent of Saudi Arabia’s mortgage market, which is forecast to grow to SR500 billion by 2020 and SR800 billion within the next decade.
Susini told Reuters last week that the company aims to issue up to $1.07 billion of long-term sukuk this year, as it prepares to purchase more home loan portfolios.
Saudi real estate firm to buy mortgages worth $200m
Saudi real estate firm to buy mortgages worth $200m
- The agreements included deals with Banque Saudi Fransi and Saudi British Bank (SABB)
- The company aims to inject liquidity into the Saudi housing finance market by buying out mortgages
Fitch affirms Qatar’s rating at AA, outlook stable
RIYADH: Qatar has retained its AA credit rating from Fitch Ratings, with a stable outlook, supported by the country’s expanding liquefied natural gas production capacity and high per capita income.
The US-based agency highlighted Qatar’s strong fiscal position, citing one of the world’s highest gross domestic product per capita figures and a flexible public finance framework that bolsters the country’s resilience.
An AA rating signals very low credit risk and a robust ability to meet financial commitments, even in the face of foreseeable economic pressures.
Qatar’s strong credit rating aligns with the broader trend in the Middle East, where countries are steadily diversifying their economies to reduce reliance on crude revenues.
In February, Fitch affirmed Saudi Arabia’s IDR at A+ with a stable outlook, while the UAE received a rating of AA-. The agency also affirmed Kuwait’s AA- rating in March.
“Qatar’s ‘AA’ rating reflects one of the world’s highest GDP per capita, our expectation that additional gas production will strengthen public finances and a flexible public finance structure,” said Fitch Ratings.
The report highlighted Qatar’s plans to expand LNG production capacity from 77 million tonnes per annum to 110 mtpa in 2026 and 126 mtpa by 2027, eventually reaching 142 mtpa by 2030.
According to Fitch, state-owned Qatar Energy’s North Field projects will support both hydrocarbon and non-hydrocarbon growth from 2025 to 2030.
North Field, which holds nearly 10 percent of the world’s known LNG reserves, lies off the northeast shore of the Qatar peninsula, covering more than 6,000 sq. km — roughly half the country’s land area.
“Funding plans for the 2030 phase will depend on hydrocarbon prices at that time but we expect it is likely that most of the project will be funded with internal resources,” added Fitch.
The agency also projected that Qatar’s government debt-to-GDP ratio will fall to about 43 percent by 2027, down from 49 percent in 2024 and a peak of 85 percent in 2020.
Fitch noted that Qatar’s government is expected to refinance most upcoming external market debt maturities and pay down external loans using a moderate budget surplus, excluding income from its sovereign wealth fund investments.
Qatar’s sovereign net foreign assets per GDP reached $398 billion in 2024, up from $347 billion in 2023, reaffirming the country’s strong financial standing.
However, the report also outlined key constraints that could impact Qatar’s rating in the future, including its heavy reliance on hydrocarbons, higher government debt-to-GDP ratio compared to regional peers, and regional stability risks.
“Qatar has broadly normalized its relations with the GCC in recent years, although points of tensions remain. Qatar continues to position itself as a mediator in relations between Western powers and Iran and Hamas, among others,” Fitch noted.
It added: “High tensions in the region and uncertainty around US Middle East policy contribute to the persistence of regional geopolitical risks, which could impact Qatar, although it has so far not been directly affected.”
Egypt Suez Canal monthly revenue losses at around $800m, El-Sisi says
CAIRO: Egypt’s President Abdel Fattah El-Sisi has announced that the monthly losses of the Suez Canal revenues reached around $800 million due to the regional “situation,” as Yemen’s Houthis have been attacking vessels in the Red Sea.
The Iran-backed Houthis have attacked vessels in the Red Sea area since November 2023 in support of Palestinians in Gaza during the war with Israel, disrupting global shipping by forcing vessels to avoid the nearby Suez Canal and reroute trade around Africa, raising shipping costs.
The Egyptian presidency statement did not directly refer to the Houthis, but El-Sisi said in December the disruption cost Egypt around $7 billion in less revenue from the Suez Canal in 2024.
The Yemeni group recently vowed to resume attacking US vessels in the Red Sea, in response to deadly US strikes on Yemen that killed at least 53 people on Saturday, in the biggest US military operation in the Middle East since President Donald Trump took office in January.
They also said last week they would resume attacks on Israeli ships passing through the Red Sea if Israel did not lift a block on aid entering Gaza.
Oil Updates — crude gains on Mideast risks, China stimulus plan and data
BEIJING/SINGAPORE: Oil prices rose slightly on Tuesday, supported by instability in the Middle East as well as China’s stimulus plans and data, although global growth concerns, US tariffs and Russia-Ukraine ceasefire talks curbed gains.
Brent futures rose 36 cents, or 0.5 percent, to $71.43 a barrel by 10:00 a.m Saudi time, while US West Texas Intermediate crude futures rose 32 cents, or 0.5 percent, to $67.90
“Along with US strikes on the Houthis in Yemen, several factors provided support to the market,” ING analysts said in a research note.
“China unveiled plans to revive consumption, while Chinese retail sales and fixed asset investment growth came in stronger than expected.”
The state council, or cabinet, unveiled on Sunday a special action plan to boost domestic consumption, with measures such as boosting incomes and offering childcare subsidies.
On Monday, Chinese economic data showing that retail sales growth quickened in January-February also gave investors reasons for optimism, although factory output fell and the urban jobless rate reached its highest in two years.
Crude oil throughput in China, the world’s biggest crude importer, rose 2.1 percent in January and February from a year earlier, supported by a new refinery and holiday travel, official data showed on Monday.
Prices also gained support from President Donald Trump’s vow to continue the US assault on Yemen’s Houthis unless they end their attacks on ships in the Red Sea.
On the Israel-Palestinian conflict, Israeli air strikes in Gaza killed at least 200 people, Palestinian health authorities said, as attacks on Tuesday ended a weeks-long standoff over extending a ceasefire that halted fighting in January.
Highlighting persistent concerns about demand, a key downside risk for oil, the OECD said on Monday that Trump’s tariffs would drag down growth in the US, Canada and Mexico, which would weigh on global energy demand.
“With global supply surging and tariffs and trade wars set to hit global demand, we remain of the view that prices will head lower and eventually reach the mid $60s,” said Robert Rennie, head of commodity and carbon strategy at Westpac.
Further adding to global supply, Venezuela’s state-run PDVSA has put together three operational scenarios indicating it plans to continue producing and exporting oil from its joint venture with Chevron after the
US major’s license expires next month, according to a company document reviewed by Reuters on Monday.
Talks on Tuesday between Trump and Russian President Vladimir Putin about ending the Ukraine war were also in focus.
Markets believe a potential peace negotiation would involve the easing of sanctions on Russia and the return of its crude supply to global markets, weighing on prices.
MSC launches service to boost Saudi-East Asia trade
JEDDAH: A new shipping service by Mediterranean Shipping Co. is set to strengthen trade links between Saudi Arabia and key ports in East Asia, bolstering the Kingdom’s global logistics network.
Saudi Ports Authority, known as Mawani, announced that MSC will launch the new “Clanga” line at the Jubail Commercial Port, adding that it will strengthen the Kingdom’s position in investment and logistics, according to the country’s official press agency.
The service will connect Jubail Commercial Port with King Abdulaziz Port in Dammam, Port of Singapore, and Port of Shanghai in China, as well as Port of Colombo in Sri Lanka, with a handling capacity of up to 6,000 twenty-foot equivalent units.
This move is expected to boost foreign investment and improve supply chain efficiency. It also aligns with Mawani’s efforts to enhance the competitiveness of Saudi ports and support national exports, as well as the National Transport and Logistics Strategy’s goal of establishing the Kingdom as a global logistics hub connecting three continents.
Mawani said in a statement that the addition of the service to the Jubail port highlights its strategic role in enhancing maritime transport and logistics while supporting economic activities in the Eastern Province.
The authority added that the port’s proximity to production hubs, coupled with advanced infrastructure, allows it to accommodate vessels of various types and sizes, further strengthening Saudi Arabia’s connectivity with global terminals.
As a key facilitator of national exports, particularly industrial and petrochemical products from Jubail Industrial City, the port plays a crucial role in boosting the Kingdom’s global trade competitiveness, Mawani emphasized.
In August, MSC introduced the service at the King Abdulaziz Port, connecting the city with major terminals in China, including Ningbo, Shanghai, and Shekou, as well as Singapore.
Mawani announced at that time that the service would operate weekly voyages with a capacity of up to 15,000 TEU.
In a statement, MSC said the service was designed to address terminal congestion issues in the Middle East and enhance connectivity for Asia-Middle East cargo.
The shipping company, which won the “Best Shipping Line – Asia-Africa” award at the 2024 Asian Freight, Logistics, and Supply Chain Awards, further said that Clanga would offer a unique and competitive service for Saudi exports to the Far East through its direct call in Shanghai from Dammam.
Closing Bell: Saudi main index closes higher as key stocks gain
RIYADH: Saudi Arabia’s Tadawul All Share Index edged up on Monday, gaining 29.26 points, or 0.25 percent, to close at 11,883.04.
The total trading turnover of the benchmark index was SR5.4 billion ($1.4 billion), as 100 of the stocks advanced and 142 retreated.
Conversely, the Kingdom’s parallel market Nomu dropped 240.58 points, or 0.77 percent, to close at 31,034.69. This comes as 33 stocks advanced while 45 retreated.
The MSCI Tadawul Index increased 9.09 points, or 0.61 percent, to close at 1,503.88.
TASI’s top performer was Arabian Company for Agricultural and Industrial Investment, which surged by the 30 percent daily limit in its market debut on Monday.
Its share price jumped to SR65, significantly surpassing its initial price of SR50, which was set at the upper end of the offering range.
Other top performers included Retal Urban Development Co., whose share price rose 7.18 percent to SR15.82, as well as Astra Industrial Group, whose share price surged 4.45 percent to SR169.
Alkhorayef Water and Power Technologies Co. was also among the top performers, increasing 4.38 percent to SR166.80.
Naqi Water Co. was the worst performer with its stock price falling 4.33 percent to SR57.40.
Arabian Shield Cooperative Insurance Co. also saw its stock prices decline 3.94 percent to SR17.56. Arriyadh Development Co. also dropped to SR34.65, a 3.88 percent decrease.
On the announcements front, several major Saudi companies released their annual financial results for the period ending Dec. 31, 2024, showcasing mixed performances across industries.
Arabian Mills for Food Products Co. reported a 12.98 percent increase in revenue, reaching SR973.94 million, compared to SR862.08 million in the previous year.
This growth was primarily driven by a 39.75 percent surge in feed sales following the company’s entry into the poultry feed segment and reinforced production efforts.
Bran sales also grew by 17.91 percent, and flour revenues saw a modest rise of 4.02 percent, supported by business-to-business revenue growth of 3.19 percent and incentives in the modern trade segment.
Net profit increased by 5.93 percent to SR212.15 million, supported by improved product cost efficiency, administrative streamlining, and reduced financing costs.
Despite the growth, the company saw a 1.03 percent drop in its share price to settle at SR47.90.
The United International Transportation Co., also known as Budget Saudi, posted a significant 43.03 percent increase in revenue, reaching SR1.97 billion, up from SR1.38 billion in the prior year.
This surge was fueled by the expansion of both long-term and short-term rental fleets, alongside contributions from the acquisition of AutoWorld and the integration of revenue from the Overseas Development Co.
Net profit climbed 12.44 percent to SR311.69 million, benefiting from improved rental rates, fleet expansion, and operational synergies post-acquisition.
Budget Saudi’s share price saw a 0.26 increase to reach SR76.40.
Meanwhile, the Kingdom Holding Co. saw an 11.57 percent decline in revenue to SR2.39 billion, down from SR2.70 billion in the previous year.
The decline was primarily attributed to reduced dividend income and lower gains on investments at fair value through profit or loss.
Despite the revenue drop, net profit rose by 22.08 percent to SR1.24 billion, supported by lower financial charges, gains from the reversal of impairments, increased share of profits from equity-accounted investees, and higher income from hotel operations.
Kingdom Holding’s stock price increased by 1.64 percent to reach SR8.06.
BinDawood Holding Co. reported a modest 1.33 percent increase in revenue, reaching SR5.68 billion, compared to SR5.60 billion in the previous year.
The growth was driven by contributions from new store openings, increased sales from Jumeirah Trading Co. and Future Retail Tech, and improved point-of-sale performance.
However, this was partially offset by store closures during the year. Net profit grew by 1.88 percent to SR280.25 million, supported by stronger supplier terms, operational efficiencies, and a better product mix, though higher operating expenses related to talent acquisition and business expansion limited the increase.
BinDawood’s stock price grew 0.63 percent on Monday to reach SR6.42.
