Transcript Slayt 1 - Iktissad Events

2016 IRAQ BANKING FORUM
Beirut, Lebanon
Confidential
September 2015
Our Firm
• We are an independent Iraqi owned and managed
financial services firm
Best Brokerage
House in Iraq
• We operate out of 3 offices in Iraq and provide services
through two entities
2011 & 2013 & 2014
• Rabee Securities: a securities brokerage firm licensed
and regulated by the Iraqi Stock Exchange (ISX)
Execute transactions for local, regional and international
clients. Our client base includes both institutional and
private clients
Best Investment
Bank in Iraq
• Melak Iraq provides investment banking, advisory and
merchant banking services to local and international
corporate clients and family businesses
Play a bridging role providing services to local Iraqi
companies and international firms with interest in Iraq
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2013
Execution Ability
 Acted as principal lender and sole arranger providing working
capital facility to support daily operations and facilitate growth
plans for an Oil and Gas services Firm
FINANCING
 Local Adviser providing value added services
 Focus on providing unique financial solutions
 Facilitate funding for project finance and trade
finance activities
TRADE
FINANCING
 Investor in an Oil and Gas services company providing
drilling fluids
INVESTING
Advisory
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Equity Capital Markets: Performance
RSISX Index*
2011: 51.8%
2012: 7.4%
2013: 15.5%
2014: -25.3% 2015: -16.9% (YTD)
RSISX Index
2200
14
2000
12
1800
8
1400
6
1200
($ mn)
10
1600
4
1000
2
600
0
J-11
F-11
M-11
A-11
M-11
J-11
J-11
A-11
S-11
O-11
N-11
D-11
J-12
F-12
M-12
A-12
M-12
J-12
J-12
A-12
S-12
O-12
N-12
D-12
J-13
F-13
M-13
A-13
M-13
J-13
J-13
A-13
S-13
O-13
N-13
D-13
J-14
F-14
M-14
A-14
M-14
J-14
J-14
A-14
S-14
O-14
N-14
D-14
J-15
F-15
M-15
A-15
M-15
J-15
J-15
A-15
S-15
800
ISX-Daily Trading Vol. (Right)
IQD RSISX Index
USD RSISX Index
* The Index is a free float weighted index of 10 ISX stocks.
* Index companies represents 57% of the liquidity in the ISX. (Calculated on September 13, 2015 according to the average daily
trading volumes in the recent six months.)
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Equity Capital Markets: Landmark Deals
 2 landmark deals
that added more
than USD 8 billion
to the total Iraq
Stock
Exchange
market
capitalization
 The largest ever
listings in Iraq and
among the largest
listings in the
MENA region
Listing of 25%
67,503,000,000 shares
For a total of
Listing of 25%
1,485,066,000,000 IQD
457,445,663,350 shares
(1,240,000,000 USD)
Sole distributer
joint lead manager
& sole distributer
Sole financial
adviser
sole adviser & joint
lead manager
June 2015
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February 2013
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Equity Capital Markets: Opportunity
 The ISX is at a very
nascent stage
 A country that is fifth
in the world in oil
reserves with 30 plus
million in population
should develop to
the level and size of
similar markets in
the GCC
 Further, the number
of companies listed is
relatively small with
limited diversity in
terms of sectors
Country
# of Firms
Listed
Market Cap (September
2015)
Saudi Arabia
171
$463 Bln
Qatar
44
$173 Bln
Abu dhabi
66
$124 Bln
Dubai FM
60
$97 Bln
Kuwait
222
$89 Bln
Morocco
90
$59 Bln
Egypt
268
$58 Bln
Bahrain
48
$51 Bln
Jordan
264
$29 Bln
Oman
129
$24 Bln
Tunis
76
$22 Bln
Iraq
98
$12 Bln
Lebanon
29
$12 Bln
Palestine
50
Less than 10 Bln
Syria
24
Less than 10 Bln
Source: Zawya, Individual stock exchanges’ websites
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Equity Capital Markets: Opportunity
Market Cap as % of GDP
100
90
80
70
60
%
50
2012
40
2013
30
2014
20
10
0
ISX
Oman
UAE
Kuwait
Bahrain
Jordan
Source: World Bank, United Nations, Individual stock exchanges’ websites
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Saudi Arabia
Qatar
Debt Capital Markets: Indicators
Deposits (% of GDP)
Source: World Bank
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Debt Capital Markets: Indicators
Domestic credit provided by financial sector (% of GDP)
Domestic credit provided by the financial sector includes all credit to various sectors on a gross basis, with the exception of credit to the central government, which is net. The financial sector
includes monetary authorities and deposit money banks, as well as other financial corporations where data are available (including corporations that do not accept transferable deposits but do
incur such liabilities as time and savings deposits). Examples of other financial corporations are finance and leasing companies, money lenders, insurance corporations, pension funds, and
foreign exchange companies.
Source: International Monetary Fund, International Financial Statistics and data files, and World Bank and OECD GDP estimates
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Debt Capital Markets: Indicators
Domestic Credit provided to the private sector (% of GDP)
Source: World Bank, July, 27, 2015
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Debt Capital Markets: Indicators
Lending interest rate (%)
Lending rate is the bank rate that usually meets the short- and medium-term financing needs of the private sector. This rate is normally
differentiated according to creditworthiness of borrowers and objectives of financing.
Source: International Monetary Fund, International Financial Statistics and data files
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Challenges Faced
•
Understanding of Capital Markets (Process, players, products)
•
Regulatory Framework Development and support
• Custody
• Debt market regulations, issuance framework (corporates)
• Empowering market players / dealers (dealer system and clearing rules,
etc)
• Repos market
•
Level of product sophistication
•
Benchmarking
• Issuance is irregular – more adhoc vs scheduled (no true yield curves)
• Limited benchmarking
•
Liquidity Pools of domestic liquidity are key to supporting capital markets
• Raising domestic savings rates
• Insurance sector development
• Pension reforms
• Banks offering of dedicated long term savings products
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Disclaimer
This document contains information that is privileged and confidential. Any dissemination,
distribution, copying or unauthorized use of this document without the written consent of Melak
Iraq and or Rabee Securities is strictly prohibited.
This document is for informational purposes only and is not an offer to sell securities by Melak Iraq
or Rabee Securities or any other party. At such time as Melak Iraq, Rabee Securities or any other
party referenced in this presentation should decide to effect an offering of securities, such offering
will be made by means of a private placement memorandum which satisfies all applicable legal
requirements.
This document contains certain forward looking statements regarding strategies, plans, beliefs,
and current expectations of Melak Iraq and Rabee Securities. Recipients are cautioned that any
such forward looking statements are not guarantees of future events and involve risks and
uncertainties that would cause actual results to differ materially from those in the forward looking
statements.
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