Saturday, 5 September 2009

$30m UAE claim again Saudi Saad group unit

Source: Reuters
Abu Dhabi Commercial Bank, the UAE's third largest lender by assets, has filed a $30m debt claim against a unit of troubled Saudi conglomerate Saad Group, sources said.
The claim is the first against the troubled group by ADCB and more claims are likely to follow, the bank sources told Reuters late on Thursday.
ADCB, which has significant exposure to the group, filed the claim on Wednesday in London's High Court against Saad Trading, Contracting & Financial Services Company, part of the Saad Group that is owned by Maan Al Sanea, the Saudi billionaire.
"It is a $30m debt claim and relates to a foreign exchange deal and had to be done under United Kingdom law," the source familiar with the matter said, declining to be named due to "confidentiality issues".
"This is our first claim, there could be others." ADCB confirmed it has sued a unit of the Saad group but declined to provide details.
"This claim is part of a number of actions taken by the bank to protect its interests vis-à-vis its exposures to the Saad Group," Simon Copleston, ADCB's general counsel and board secretary said, without elaborating.
Banks in the region have been coping with the fallout from debt restructuring at two family-owned Saudi conglomerates - Saad and Ahmad Hamad Algosaibi & Bros (AHAB) - in the biggest financial fiasco to hit the Middle East in the economic crisis.
The two groups' problems came to light in late May when the Saudi central bank froze the accounts of Al-Sanea. UAE's Mashreqbank is suing the Algosaibi group in a New York court. Several regional and international banks including Citigroup, BNP-Paribas are exposed to the two conglomerates. In July, the UAE central bank directed banks to take provisions of 50 to 75 percent of their exposure to the troubled groups over two years.

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