Business

Dubai regulator fines Emirates REIT manager over asset report

Dubai Financial Services Authority (DFSA) said on Wednesday it had fined Equitativa, the manager of a sharia-compliant real estate investment trust, $210,000 for misleading statements regarding one of its assets.

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Equitativa made misleading statements on two occasions in 2018 regarding one of Emirates REIT’s 11 assets, a school in Dubai Investment Park, the DFSA said.

“The DFSA also identified concerns around Equitativa’s fund valuation practices,” it said in a statement, adding that the fund manager had agreed to pay the fine.

Equitativa said in a statement that the settlement brought all investigations to a close and it could “now turn its full attention to reinvigorating Emirates REIT and accelerating its plans for growth”.

“To be clear, none of the findings alleges any financial impropriety on part of Equitativa or its employees,” it said.

Equitativa in 2018 failed to provision for money Emirates REIT (EREIT) was owed by the school despite it being in default on rental payments, the regulator said.

Equitativa did not reduce the valuation of the asset in the fund’s half-year financial statement, despite the school lacking an operator for the following academic year, the DFSA added.

“Rather, the school was presented as 100 percent occupied with a secure tenant with a 28-year lease in place,” the DFSA said, adding that this meant that “EREIT’s net profit for the six months to 30 June 2018 was overstated”.

When, later that year, Equitativa informed its investors that the school was no longer operating, it gave the “misleading impression that a new operator had been secured and would be in place for the following academic year,” the regulator said.

Equitativa in 2019 included a full provision for the money owed by the school and an impairment for the asset, both the regulator and the fund manager said.

The manager has agreed to address concerns around its valuation practices and will appoint an independent valuation expert for Emirates REIT’s 2022 valuation reports, DFSA said.

Emirates REIT this year failed to gain investor support for an offer to exchange $400 million Islamic bonds for new paper, after the coronavirus strained its finances.

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Business

Egypt to raise food subsidies spending by 20 percent in FY 2023/24 draft budget

Egypt expects to raise its allocation for food subsidies by 20 percent and for petroleum products by 24 percent in the 2023-24 fiscal year, according to a draft budget approved by the cabinet on Wednesday.

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The budget forecasts GDP growth at 4.1 percent and inflation at an average rate of 16 percent during the next fiscal year, which starts in July, according to a cabinet statement.

Egypt has been struggling to contain economic pressures exposed by the consequences of the war in Ukraine, which include rising costs to grain and fuel imports.

Its currency has come under renewed pressure this month despite three sharp devaluations since last March that have seen the Egyptian pound lose nearly half its value against the dollar. Headline inflation has accelerated to five-and-a-half year highs of 31.9 percent.

Despite the challenges, the government is projecting a primary surplus of 2.5 percent, a 38.4 percent rise in overall revenues and a 28 percent rise in tax revenues, the cabinet statement said.

The budget still needs approval by Egypt’s parliament.

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Business

Kazakhstan seeks $5.1 bln fine from Kashagan oil field: Report

Kazakhstan has filed a claim against the Kashagan oil venture for about 2.3 trillion tenge ($5.14 billion) in environmental protection fines, Bloomberg News reported on Wednesday, citing the country’s Ecology and Natural Resources Ministry.

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The ministry has accused the North Caspian Operating Company (NCOC) which runs Kashagan, of keeping more than double the amount of sulfur permitted on the site, the report said.

The NCOC did not immediately respond to a Reuters’ emailed request for comment.

Kashagan, which is one of Kazakhstan’s biggest oilfields, halved its output last year for about two months due to a gas leak. The field has now fully restored production.

Some of the Central Asian nation’s biggest oilfields stopped for planned maintenance last year.

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Business

Bitcoin climbing toward $30,000 again following Binance’s legal woes

Bitcoin renewed its climb toward $30,000 with risk appetite rising across global markets and concern about the fallout from Binance’s legal woes waning.
The largest cryptocurrency by market value rose for a second day, gaining as much as 4.9 percent to $28,638 on Wednesday. It had climbed to just below $29,000 on March 22, the highest since June. Other tokens also rallied, with XRP jumping about 9 percent, Cardano increasing 7 percent and Polygon rising 4 percent. Ether was up less than 2 percent.

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Bitcoin touched a 10-day low on Monday after Binance Holdings Ltd., the world’s largest crypto exchange, was sued by the US Commodity Futures Trading Commission for allegedly breaking trading and derivatives rules. Binance said it didn’t agree with the characterization of many of the issues alleged in the complaint.

One measure technical analysts use suggests that the price gains may continue. The Relative Strength Index or RSI for Bitcoin crossed a crucial threshold on Wednesday, signaling the potential for more upward momentum to the cryptocurrency’s 66 percent price rally in 2023.

Bitcoin’s monthly RSI crossed above 50, a level it had dropped below in May last year following the collapse of Terra’s algorithmic stablecoin project. A move above 50 indicates that price momentum has transitioned to a bullish regime and a move below, the opposite. Since the major low recorded in January 2015, there have only been three other instances when this happened — October 2015, April 2019 and April 2020. The average returns three and 12 months after were 26 percent and 182 percent.

Although the monthly RSI has crossed above 50, the signal will be cemented only if the level is maintained on the last trading day of the month.

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