Q2 profits for Oman's banks down & Oman spending money on.... boats.

Well, it was of little surprise to see that Oman's biggest banks have reported a particularly tough second quarter of '09. Bank Muscat's exposure to two Saudi firms (Saad Group and Al-Gosaibi) were valued at approximately $171 million, National Bank of Oman's exposure is significantly less, reportedly $17 million.

Bank Muscat's profit fell from RO 31.29 million to RO 12 million, but at least it's turning a profit. However, it's share price is dropping, presumably on the back of news of the latest quarterly report. It's share price closed at RO 0.729 last week. It's 52 week high was RO 1.830 - that's quite a drop indeed.

So what does all this mean for people like you and me? Probably not very much. Bank Muscat continues to out-perform all of the other top 5 Oman banks, and has the largest network of ATM's and ABM's - which is handy for us.

Surprisingly, no news on HSBC's performance in Oman was mentioned in the news. I like to think that's because HSBC are so terrible here in Oman that they are not actually officially recognised as a bank. One can dream.

So, onto the other piece of news for today. Oman seems to be spending money on it's Navy and merchant fleet. Two significant deals have come to my attention in weeks of late:

1. Oman signed a deal with the UK-based company BVT Surface Fleet on the 15th January 2007. And now they've announced that they've finished building the Royal Navy of Oman Vessel (RNOV) Al Shamikh and it's presumably on it's way to patrol the waters off of the coast of Sur to protect us from those fiendish Israeli funded Somalian pirates. Expect 2 more Corvette class vessels in the future, all part of the original agreement signed back in 2007.


2. Oman, have just recently signed a deal with the Chinese. This deal is for the state-owned Oman Shipping Company. The Chinese shipbuilder Jiangsu Rongsheng Heavy Industries Co, won a $484 million deal to build four ships for them. These ships will be ready by the end of 2011 or early 2012 and will be leased to Brazil's Companhia Vale do Rio Doce (Vale) for their mineral exports from the new Iron Ore facility being built in Sohar Port.

Additionally, the state-owned Oman Shipping Company has stated that it wants to continue to expand it's fleet of vessels and plans to spend $4 billion expanding it's fleet. That's a lot of boats!