Bank Muscat hit by $39 mln card fraud

12 pre-paid travel cards compromised outside Oman

DUBAI, Feb 26, ( RTRS): Bank Muscat, Oman’s largest lender, will take an impairment charge of up to 15 million rials ($39 million) after a small number of prepaid travel cards were hit by fraud, the bank said on Tuesday.

The bank said its board met on Monday after 12 prepaid travel cards were compromised outside of Oman. The cards allow users to carry currencies abroad rather than using their debit or credit cards in foreign countries, which can be expensive.

No other customers have been affected by the fraud.

“We are exploring all avenues to sharia-compliant products through standalone branches.

According to Jaroudi, this could mean that after an initial phase of mostly organic growth, conventional banks’ Islamic businesses might be spun off into separate subsidiaries and become acquisition targets.

Jaroudi called on Omani regulators to increase the maximum amount of funds that can be placed overseas by local banks, which would help them manage their short-term funding needs.

Oman’s Islamic banking regulations restrict the money market instruments which banks can use to minimize the impact on our shareholders and will pursue the various options available to the bank,” Bank Muscat said, adding it would update the market when more information was available.

Shares in Bank Muscat recovered somewhat on Tuesday, trading up 2.1 percent at 0625 GMT, having slumped 4.3 percent on Monday, the largest one-day fall in the stock since July 2011.

The impairment, which was a result of unspecified electronic fraud, represented 10.5 percent of Bank Muscat’s estimated 2013 earnings, United Securities said in a note. manage funds, and some bankers believe this could hurt profitability.

The development of the Islamic banking sector could be delayed if such issues are not addressed by regulators, Jaroudi said.

Horizon

“Two to three years is a normal time horizon but certain issues have to be addressed by the central bank.”

Bank Nizwa will first offer retail products, with corporate products expected within the year, Jaroudi added.

“Corporate is in our agenda defi-

However, even taking the impairment into account, the stock was “still underpriced as compared to its domestic and regional peers,” trading at around 1.1-times book value, the note added.

Bank Muscat posted a 18.5 percent increase in 2012 net profit last month, fuelled by a 16.2 percent growth in lending.

The bank expects lending growth to be around 14-15 percent this year, driven by high government spending and higher wages for local citizens, its chief operating officer was quoted by local media as saying earlier this month. nitely. I am sure in the third or second quarter of this year we should have closed some of the corporate deals.”

Omani companies are considering issues of sukuk, and a corporate issuer might conceivably tap the market ahead of Oman’s first sovereign issuance, Jaroudi said.

The sovereign sukuk, when it comes, “will be a high-ticket item because definitely the government will use that for financing other ministries.” But if the government issue takes some time and a good corporate issuer emerges, Bank Nizwa will not hesitate to handle the issue, Jaroudi added. DUBAI, Feb 26: Aon Hewitt, the global human resources business of Aon plc (NYSE: AON), has revealed salary stability across the GCC for 2012.

Data from the winter update of Aon Hewitt’s annual Middle East Salary Increase Survey — based on participation from almost 120 companies across the GCC — has confirmed that the average salary increase across all sectors in the GCC in 2012 was consistent with levels predicted by participating organizations during 2011. On average, the organizations surveyed in the GCC both predicted and subsequently reported an average increase of 5.4% in salaries at the close of 2012.

The winter update of the Salary Increase Survey also gives organizations an opportunity to reforecast their salary increases for 2013, having last made their estimates in the middle of 2012. Companies surveyed in the GCC forecast an average salary increase of 5.4% during 2013 - no change from 2012, indicating an underlining stability in the market with relatively consistent rates of increase and overall growth in salaries year-on-year. Martin McGuigan, Head of Reward Consulting at Aon Hewitt Middle East, commented on the latest results: “The Aon Hewitt Middle East Salary Increase Survey provides a valuable snapshot of overall trends in salary increases in the GCC and enables organizations to benchmark their forecasts with the market in order to remain competitive.”

“Across the GCC, we are seeing a growing trend towards performancebased pay, and this appears to be coming more prevalent as the market continues to mature, giving organizations a means of capping their pay budget in accordance with business performance. Indeed, Aon Hewitt has seen an increase in demand for such information from a number of core industry verticals - including public sector, healthcare and media - and, as a result, we will soon be launching a series of new data surveys to give businesses better insight into salary levels within their specific sector.” The report also reveals that no GCC firms were planning a hiring freeze and that 41% of organizations surveyed across the GCC are looking to increase recruitment this year compared to 2012.