Mashreq files case in UAE against Ahab to claim $398m

Dubai-based Mashreq bank has filed a court case in the UAE against Saudi group Ahmad Hamad Algosaibi and Brothers (Ahab) to claim $398 million (Dh1.4 billion) owed by the group, it said.

It said this amount included the $225m it seeks to recover from Ahab in a lawsuit filed in New York.

"Mashreq confirms legal proceedings are under way in the UAE for the claimed amount of Dh1.46bn owed to it by Ahab," the bank said in an e-mailed statement.

"In both jurisdictions, Mashreq is seeking the return of the funds owed to it by Ahab."

The Algosaibi family conglomerate has in turn filed a lawsuit in New York against Mashreq and Maan Al Sanea, Head of Saudi Arabia's Saad Group, seeking combined damages of more than $2bn.

Algosaibi and Saad are battling over billions in debt they owe to a large group of regional and international banks. Thirteen banks in the UAE have exposures to the troubled groups.

In the statement, the Dubai-based Mashreq reiterated the debt owed to it by Ahab was in excess of $400m.


Bahrain's TIBC owes $2bn to banks

Bahrain-based The International Banking Corporation (TIBC), owned by troubled Algosaibi Group, owes $2.07 billion (Dh7.6bn) to banks, and it is unclear if its assets can be recovered to pay creditors, a well-placed source said.

TIBC is part of a wrangle between Ahab and Saad Group, involving a debt pile estimated at $22bn that has shocked the Middle Eastern banking community.

The Central Bank of Bahrain (CBB) assumed control of TIBC and Saad Group's Bahrain-based Awal Bank in July 2009, and appointed external administrators to protect creditors' claims.

The administrators, law firm Trowers & Hamlins, prepared a statutory report on TIBC that it presented to the CBB and TIBC's creditors. The source familiar with the report said that the $2.074bn TIBC owed to banks included about $300 million money market liabilities, $361m foreign exchange transactions and structure trade finance deals worth about $1.4bn.

Deutsche Bank and TIBC are battling in court over TIBC's failure to make good on its portion of two foreign exchange transactions, under which the German bank agreed to swap $59.8m for £40m (Dh233m).

The source said TIBC holds assets worth $4bn in its books.

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