GOA: The development bank set up by the BRICS group of emerging economies will ramp up lending to $2.5 billion next year after making its first loans to back green projects, its president KV Kamath told Reuters.
The BRICS — Brazil, Russia, India, China and South Africa — agreed to create the New Development Bank (NDB) in July 2014 with initial authorized capital of $100 billion. The lender was officially launched a year later.
“The second year is scaling up, concentrating on people, getting all the skillsets in,” said Kamath, a veteran Indian banker appointed as the first head of the Shanghai-based NDB.
He was speaking on the fringes of a weekend BRICS summit hosted in the Indian resort of Goa by Prime Minister Narendra Modi. The gathering seeks to add substance to the group that grew out of an acronym devised by Goldman Sachs economist Jim O’Neill back in 2003 that projected a long-term boom and global power shift in their favor.
With Russia, Brazil and South Africa on the economic skids and China slowing, the initial euphoria has faded, yet Kamath said the BRICS had much to gain by deepening their cooperation.
“The fact is that these countries, collectively, have for the last few years contributed to more than 50 percent of incremental economic wealth that has been generated globally,” said Kamath. “I don’t see that changing.”
The NDB, headquartered in Shanghai, will expand its staff to 300 over the next three years but run a tight operation that seeks to take quick decisions and transfer experience across all five BRICS member states.
It has already approved loans totalling $900 million to green projects in each member state. It has also started a renminbi-denominated borrowing program, issuing a 3 billion yuan ($450 million) bond.
Kamath, 68, said there was plenty of room for new lenders like the NDB and the Chinese-led Asian Infrastructure Investment Bank (AIIB), in addition to established institutions like the World Bank.
“Infrastructure alone has needs globally of $1-1.5 trillion a year — all the multilateral banks put together can do maybe 15 percent of this,” said Kamath, who ran India’s ICICI Bank Ltd. from 1996 until 2009.
“The phrase I would like to use is cooperate and work together, rather than compete. I don’t see competition as a key challenge in this context.”
BRICS development bank to lend $2.5bn next year
BRICS development bank to lend $2.5bn next year
Closing Bell: Saudi main index rises to close at 11,251
RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Thursday, gaining 84.27 points, or 0.75 percent, to close at 11,251.81.
The total trading turnover of the benchmark index was SR5.38 billion ($1.43 billion), as 188 of the stocks advanced and 67 retreated.
Similarly, the Kingdom’s parallel market Nomu gained 157.22 points, or 0.67 percent, to close at 23,643.74. This comes as 44 of the stocks advanced while 32 retreated.
The MSCI Tadawul Index gained 10.88 points, or 0.72 percent, to close at 1,517.43.
The best-performing stock of the day was Saudi Kayan Petrochemical Co., whose share price surged 9.96 percent to SR5.30.
Other top performers included Ataa Educational Co., whose share price rose 9.94 percent to SR57.50, as well as Rabigh Refining and Petrochemical Co., whose share price surged 5.74 percent to SR7.55.
Saudia Dairy and Foodstuff Co. recorded the most significant drop, falling 5.93 percent to SR220.50.
Abdullah Saad Mohammed Abo Moati for Bookstores Co. also saw its stock prices fall 2.77 percent to SR43.56.
Zahrat Al Waha for Trading Co. also saw its stock prices decline 2.30 percent to SR2.55.
On the announcement front, Multi Business Group Co. reported its annual financial results for the year ended Dec. 31. According to a Tadawul statement, the firm recorded a net profit of SR352,172 during the year, down 98 percent from the previous year.
The company attributed the decline primarily to a 2 percent drop in building contracting revenues and a 73 percent decrease in gross profit.
Multi Business Group Co. ended the session at SR9.90, down 1 percent.
Hamad Mohammed Bin Saedan Real Estate Co. announced the signing of a memorandum of understanding with Saudi Awwal Bank to enhance collaboration in financing solutions, advance real estate development projects, and expand access to customer financing programs.
Hamad Mohammed Bin Saedan Real Estate Co. ended the session at SR6.67, up 1.21 percent.
