The decision by three banks to walk away from the negotiating table over Dubai Group's US$10 billion (Dh36.7bn) restructuring is a sign of the harsh new realities of the global banking business.
In 2010, about 90 banks were persuaded in a couple of months that they should come to terms with Dubai World over its $25bn restructuring.
In contrast, Dubai Group's stand-off with creditors has lasted since late 2010, when the company, part of the conglomerate owned by the Ruler of Dubai, missed two debt payments.
Progress has been made, but that was not sufficient for Royal Bank of Scotland (RBS), Commerzbank and Standard Bank. Why? The reference in a statement by RBS to "a number of factors outside our control" speaks volumes.
Since the Dubai World settlement, European banks' credit departments have gone into virtual meltdown; with one eye on the endless crisis of the euro zone, loan books have been subjected to savage rigour. Whereas in 2010 creditors were prepared to give Dubai the benefit of the doubt, in the hope of maintaining good commercial relations with the emirate during its recovery phase, now there is no such indulgence.
Perhaps also, for RBS at least, the gathering storm over Libor fixing in the United Kingdom was another external factor. The bank just has bigger fish than Dubai to fry these days.
The other reason for the banks' withdrawal is this: there are no bankruptcy arrangements in place for Dubai Group companies, as there were for Dubai World.
Decree 57 put in place the tribunal that could oversee compulsory bankruptcy arrangements, which acted as a strong deterrent to dissident creditors.
Those who have called for the decree's provisions to be extended across the emirate will feel vindicated by the Dubai Group situation.
But whether it's brinkmanship, bluff or sound business by the three dissident banks remains to be seen.
fkane@thenational.ae
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Various Artists
Habibi Funk: An Eclectic Selection Of Music From The Arab World (Habibi Funk)
WandaVision
Starring: Elizabeth Olsen, Paul Bettany
Directed by: Matt Shakman
Rating: Four stars
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Hotel Silence
Auður Ava Ólafsdóttir
Pushkin Press
Jigra
Starring: Alia Bhatt, Vedang Raina, Manoj Pahwa, Harsh Singh
Auron Mein Kahan Dum Tha
Starring: Ajay Devgn, Tabu, Shantanu Maheshwari, Jimmy Shergill, Saiee Manjrekar
Director: Neeraj Pandey
Rating: 2.5/5
The five pillars of Islam
The Sheikh Zayed Future Energy Prize
This year’s winners of the US$4 million Sheikh Zayed Future Energy Prize will be recognised and rewarded in Abu Dhabi on January 15 as part of Abu Dhabi Sustainable Week, which runs in the capital from January 13 to 20.
From solutions to life-changing technologies, the aim is to discover innovative breakthroughs to create a new and sustainable energy future.
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
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Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
'Skin'
Dir: Guy Nattiv
Starring: Jamie Bell, Danielle McDonald, Bill Camp, Vera Farmiga
Rating: 3.5/5 stars
COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
DUBAI SEVENS 2018 DRAW
Gulf Men’s League
Pool A – Dubai Exiles, Dubai Hurricanes, Bahrain, Dubai Sports City Eagles
Pool B – Jebel Ali Dragons, Abu Dhabi Saracens, Abu Dhabi Harlequins, Al Ain Amblers
Gulf Men’s Open
Pool A – Bahrain Firbolgs, Arabian Knights, Yalla Rugby, Muscat
Pool B – Amman Citadel, APB Dubai Sharks, Jebel Ali Dragons 2, Saudi Rugby
Pool C – Abu Dhabi Harlequins 2, Roberts Construction, Dubai Exiles 2
Pool D – Dubai Tigers, UAE Shaheen, Sharjah Wanderers, Amman Citadel 2
Gulf U19 Boys
Pool A – Deira International School, Dubai Hurricanes, British School Al Khubairat, Jumeirah English Speaking School B
Pool B – Dubai English Speaking College 2, Jumeirah College, Dubai College A, Abu Dhabi Harlequins 2
Pool C – Bahrain Colts, Al Yasmina School, DESC, DC B
Pool D – Al Ain Amblers, Repton Royals, Dubai Exiles, Gems World Academy Dubai
Pool E – JESS A, Abu Dhabi Sharks, Abu Dhabi Harlequins 1, EC
Gulf Women
Pool A – Kuwait Scorpions, Black Ruggers, Dubai Sports City Eagles, Dubai Hurricanes 2
Pool B – Emirates Firebirds, Sharjah Wanderers, RAK Rides, Beirut Aconites
Pool C – Dubai Hurricanes, Emirates Firebirds 2, Abu Dhabi Saracens, Transforma Panthers
Pool D – AUC Wolves, Dubai Hawks, Abu Dhabi Harlequins, Al Ain Amblers
Gulf U19 Girls
Pool A – Dubai Exiles, BSAK, DESC, Al Maha
Pool B – Arabian Knights, Dubai Hurricanes, Al Ain Amblers, Abu Dhabi Harlequins
The specs
Engine: 6.2-litre V8
Power: 502hp at 7,600rpm
Torque: 637Nm at 5,150rpm
Transmission: 8-speed dual-clutch auto
Price: from Dh317,671
On sale: now
From Europe to the Middle East, economic success brings wealth - and lifestyle diseases
A rise in obesity figures and the need for more public spending is a familiar trend in the developing world as western lifestyles are adopted.
One in five deaths around the world is now caused by bad diet, with obesity the fastest growing global risk. A high body mass index is also the top cause of metabolic diseases relating to death and disability in Kuwait, Qatar and Oman – and second on the list in Bahrain.
In Britain, heart disease, lung cancer and Alzheimer’s remain among the leading causes of death, and people there are spending more time suffering from health problems.
The UK is expected to spend $421.4 billion on healthcare by 2040, up from $239.3 billion in 2014.
And development assistance for health is talking about the financial aid given to governments to support social, environmental development of developing countries.
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Joker: Folie a Deux
Starring: Joaquin Phoenix, Lady Gaga, Brendan Gleeson
Director: Todd Phillips
Rating: 2/5
Best Foreign Language Film nominees
Capernaum (Lebanon)
Cold War (Poland)
Never Look Away (Germany)
Roma (Mexico)
Shoplifters (Japan)