19/02/2008 11:54
In a report under the title “Hello Dubai”, Citigroup refers to the investment of Dubai Financial Group in Marfin Popular Bank. According to the report, “a distinctive feature of Marfin Popular Bank is their relationship with the Emirate of Dubai. From 2006, Dubai Financial Group has owned a strategic stake in Marfin. It currently owns 20% of MPB and is seeking regulatory permission to increase its stake to 30%. Dubai is very enthusiastic about Marfin, its key strategic investment in (emerging) European banking”.
“Dubai Financial Group (DFG) is the investment vehicle via which the MPB stake is held, and is Dubai’s main vehicle for strategic investments in the financial sector, in the Gulf and overseas”. In relation to the period of time of the increase of Dubai’s stake in Marfin, the report says that the Central Bank’s approval might delay due to the second round of the presidential election.
Dubai
According to Citigroup, “Dubai Holding was created to consolidate the various large-scale infrastructure and investment projects that contribute towards Dubai’s economic, social and industrial development”1. Dubai Holding is a private company owned by Sheik Mohammed and as such its financial disclosure is different to quoted companies. The primary subsidiaries of Dubai Holding are set out in Figure 1 below, and they can be split into financial and investment companies such as Dubai Group and Dubai International Capital, and operating companies such as Dubai Properties and Tatweer (both real estate) and Jumeirah Group (hospitality and leisure)”.
“While overall financial data for Dubai Holding is limited, its main operating subsidiary, Dubai Holding Commercial Operations Group (DHCOG), is externally rated. DHCOG is rated A+ by S&P” the report added.
“We believe that Dubai Group has similar implicit sovereign backing. Dubai Group is Dubai Holding’s dedicated subsidiary to financials, including participations in banks, insurance and diversified financials, both on a regional but also on a global scale. Dubai Group was founded in 2000 and was previously known as the ‘Investment Office’ from 2000-2004 and DIG from 2004-2007. It currently includes six business units as set in Figure 2, but we would note that all things Dubai-related tend to change at rapid speed. Marfin Popular Bank (MPB) and Marfin Investment Group (MIG) are held within its Dubai Financial Group division. The ambition of the group is to be the leading financial conglomerate within the MENA region. It also targets to be a key contributor to wealth creation for its shareholders”, the report noted.
Marfin’s results
As for the results of Marfin for 2007, Citigroup says that “underlying business and revenue trends were in line with our expectations, with strong volume growth and relatively stable spreads. However, surprisingly high costs distorted the 4Q07 results, partly due to seasonal and one-off factors. We reiterate our Buy rating and €12 target price”.
Citigroup expects that Marfin will generate profits of €627.1 million in 2008, €796.2 million in 2009 and €943.8 million in 2010. Te EPS will stand at €0.79 in 2008, €1 in 2009 and €1.16 in 2010. The P/E is estimated at 8.8 times in 2008, 7.0 in 2009 and 5.9 in 2010. ROE is expected to reach 21.5% by 2010 from 17.4% in 2007.
“Dubai Financial Group (DFG) is the investment vehicle via which the MPB stake is held, and is Dubai’s main vehicle for strategic investments in the financial sector, in the Gulf and overseas”. In relation to the period of time of the increase of Dubai’s stake in Marfin, the report says that the Central Bank’s approval might delay due to the second round of the presidential election.
Dubai
According to Citigroup, “Dubai Holding was created to consolidate the various large-scale infrastructure and investment projects that contribute towards Dubai’s economic, social and industrial development”1. Dubai Holding is a private company owned by Sheik Mohammed and as such its financial disclosure is different to quoted companies. The primary subsidiaries of Dubai Holding are set out in Figure 1 below, and they can be split into financial and investment companies such as Dubai Group and Dubai International Capital, and operating companies such as Dubai Properties and Tatweer (both real estate) and Jumeirah Group (hospitality and leisure)”.
“While overall financial data for Dubai Holding is limited, its main operating subsidiary, Dubai Holding Commercial Operations Group (DHCOG), is externally rated. DHCOG is rated A+ by S&P” the report added.
“We believe that Dubai Group has similar implicit sovereign backing. Dubai Group is Dubai Holding’s dedicated subsidiary to financials, including participations in banks, insurance and diversified financials, both on a regional but also on a global scale. Dubai Group was founded in 2000 and was previously known as the ‘Investment Office’ from 2000-2004 and DIG from 2004-2007. It currently includes six business units as set in Figure 2, but we would note that all things Dubai-related tend to change at rapid speed. Marfin Popular Bank (MPB) and Marfin Investment Group (MIG) are held within its Dubai Financial Group division. The ambition of the group is to be the leading financial conglomerate within the MENA region. It also targets to be a key contributor to wealth creation for its shareholders”, the report noted.
Marfin’s results
As for the results of Marfin for 2007, Citigroup says that “underlying business and revenue trends were in line with our expectations, with strong volume growth and relatively stable spreads. However, surprisingly high costs distorted the 4Q07 results, partly due to seasonal and one-off factors. We reiterate our Buy rating and €12 target price”.
Citigroup expects that Marfin will generate profits of €627.1 million in 2008, €796.2 million in 2009 and €943.8 million in 2010. Te EPS will stand at €0.79 in 2008, €1 in 2009 and €1.16 in 2010. The P/E is estimated at 8.8 times in 2008, 7.0 in 2009 and 5.9 in 2010. ROE is expected to reach 21.5% by 2010 from 17.4% in 2007.
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