FACTBOX-Gulf Arab policy actions to face financial crisis

Dec 21 (Reuters) - Gulf Arab countries have sought to ease tight liquidity in their financial markets and prop up sagging investor confidence with a wide array of policy measures since the global credit crisis deepened in late September.

In the most recent action, Oman said it would cut reserve requirements to 5 percent from 8 percent.

Below are details of government and central bank actions. New items are marked by double asterisk (**)

SAUDI ARABIA

* The central bank cut its repurchase rate by 50 basis points to 2.5 percent on Dec. 16, ahead of a U.S. Federal Reserve policy decision. It also lowered the reverse repurchase rate to 1.5 percent from 2 percent, saying both cuts aimed to boost domestic credit.

* The Saudi Arabian Monetary Agency (SAMA), or central bank, slashed its repo rate by 100 basis points to 3 percent on Nov. 23 and also lowered reserve requirements to 7 percent from 10 percent. It had reduced the repo rate by 150 basis points to 4 percent in two moves in October, when it also cut reserve requirements from 13 percent.

* SAMA poured $3 billion in long-term deposits into the banking system, its first direct injection of U.S. dollars in a decade.

* Saudi Arabia's top economic body, the Supreme Economic Council, has promised to guarantee bank deposits.

* The kingdom extended $2.67 billion in credit to low-income citizens having difficulty getting access to loans.

KUWAIT

* The central bank cut its discount rate by 50 basis points to 3.75 percent on Dec. 17, after the Fed move. It also reduced its one-month repurchase rate to 2.5 percent from 3 percent. Kuwait has slashed its benchmark rate by 200 basis points since October.

* The central bank introduced new short-term repurchase agreements on Nov. 19 to give banks more access to funding.

* The government asked its sovereign wealth fund to set up a fund in conjunction with other state bodies to invest in the bourse. That fund should start investing some time in December, the finance minister said on Dec. 16.

* Kuwait passed laws guaranteeing all bank deposits after the central bank was forced to save Gulf Bank, which suffered steep derivatives trading losses.

* The Gulf state set up a task force headed by the central bank governor to deal with the financial crisis.

* The Kuwait Investment Authority sovereign wealth fund has pumped cash into the bourse, the Arab world's second-largest after the Saudi exchange, to help stabilise markets.

UNITED ARAB EMIRATES

* The central bank refrained from cutting interest rates after the U.S. Fed slashed rates on Dec. 16, the second time the dollar-pegged Gulf state declined to mirror the Fed. The central bank last cut its overnight repurchase rate in October by 50 basis points to 1.5 percent.

* The government set up a committee to come up with policy responses to the crisis. Members include the economy minister, central bank governor and minister of state for finance.

* Dubai said it was prepared to help state-controlled firms pay off debts.

* The finance ministry poured $6.8 billion into the financial system in October as part of a $19.1 billion rescue facility. It said it would make another $6.8 billion available in the second week of November.

* The UAE vowed to guarantee bank deposits and protect lenders from credit risk. The finance minister said on Dec. 16 the state would enact legislation to that effect soon.

* The central bank set up a $13.6 billion emergency bank lending facility in September.

* It lowered the borrowing rate on this facility in October to 1.5 percentage points over the repurchase rate from 3 percent. It cut to 3 percentage points over repo the rate at which banks could borrow above their reserve requirements, down from 5 percentage points.

QATAR

* Qatar's sovereign wealth fund said it would buy 10 percent to 20 percent of listed banks' capital to boost confidence.

* Qatar central bank said it stood ready to act if needed and had many instruments at its disposal, but has so far kept to the sidelines.

* The central bank opted not to cut interest rates when other Gulf states lowered them in October.

BAHRAIN

* The central bank slashed all key interest rates by 75 basis points on Dec. 18 in response to the Fed, taking its lending rates to 2.75 percent.

It had previously slashed its repurchase rate and overnight rate by 125 basis points to 3.5 percent in a rare move, on Oct. 30, and reduced the rates by 50 basis points earlier in the month.

* The central bank governor said in newspaper remarks the Gulf kingdom could raise its bank deposit guarantee to a maximum of 20,000 dinars ($53,060) from 15,000 dinars.

* The central bank expanded acceptable collateral for overnight funds to include ijara sukuk, a type of Islamic bond.

OMAN

** The Omani central bank said Dec. 21 it plans to reduce bank reserve requirements to 5 percent from 8 percent and raise the lending ratio from Jan. 1 as it responds to the domestic liquidity situation.

* Oman's central bank said it amended bank reserve requirement rules to release 270 million rials ($701.3 million) into the banking system.

* Oman's government said it would form a 150 million rial market-maker fund with the private sector to help stabilise its bourse.

* The Omani central bank slashed its repurchase rate by 89 basis points on Dec. 15 to 1.53 percent, having reduced it by more than 200 basis points since the start of November.

* The central bank allocated about $2 billion to local banks at an interest rate of LIBOR plus 150 basis points to provide dollar liquidity to banks. (Compiled by Daliah Merzaban in Dubai; editing by Simon Jessop) Keywords: FINANCIAL GULF/

(daliah.merzaban@thomsonreuters.com; +971 4 391 8301; Reuters Messaging: daliah.merzaban.reuters.com@reuters.net)

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