IslamicFinance.de

Qatar National Bank and Qatar Islamic Bank have raised a combined $1.3 billion in privately placed bonds. QNB‘s chief executive Ali Ahmed al-Kuwari told Reuters this week that the bank‘s U.S. dollar liquidity was excellent and that it had no immediate funding need. The bank, which is 50% owned by sovereign wealth fund Qatar Investment Authority reported a 3.5% rise in third-quarter net profit. Qatar Islamic Bank has reported a rise in net profit in the second quarter of this year. It is expected to announce its third-quarter results next week.

Several major Iranian private lenders have recently established correspondent relations with Qatar National Bank (QNB). Kourosh Parvizian, CEO of Parsian Bank, said these banks opened accounts with QNB and are prepared to offer financial services to Iranian and Qatari businesses. QNB governor Sheikh Abdullah Saoud Al-Thani said Qatari lenders will make efforts to remove trade obstacles quickly. The Iranian delegation in Doha held a meeting with officials from QNB, Al Rayan Bank and Al Khaliji Bank. They discussed using local currencies in bilateral trade and taking speedy measures to ease trade between the two countries. Bank Melli Iran is also holding talks with one of the largest banks in Qatar for establishing correspondent ties.

Qatari banks have met investors in Europe and Asia to gauge their interest in potential U.S. dollar bond issues. Access to international debt markets has become problematic since the diplomatic crisis has erupted. Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut diplomatic and transport ties with Qatar, accusing it of supporting terrorism. Cross-border deposits accounted for about a quarter of Qatar's total deposits, so banks started to look for alternative funding. Al Khalij Commercial Bank, Doha Bank, Qatar International Islamic Bank and QNB have all met investors in recent weeks. Feedback was positive, but investors also made clear that issuers would have to pay premiums in order to attract sufficient demand. According to an international portfolio manager, the premium that Qatari banks would have to pay is about 30-40 basis points. A second fund manager said Qatari banks would have to pay up not only because of the increased political risk, but also because of general market conditions in the region.

Although Central Bank of Qatar (CBQ) set the deadline requiring the country's conventional banks which have opened Islamic banking windows to close them down to be Dec. 31, 2011, it has passed almost without being noticed.
Some Islamic bankers are now stating that the move was required to prevent the alleged rampant co-mingling of conventional and Islamic funds at some of the Islamic banking windows, and that the Qatari Islamic banking sector has been successfully re-aligned and consolidated.
The clear message of the directive is that dedicated standalone Islamic banks are favored to half-way houses where co-mingling and all sorts of compromises are possible if not the norm.
The affected banks included the Al-Islami window of Qatar National Bank (QNB), the largest bank in the emirate; Commercial Bank of Qatar; Doha Bank; HSBC Amanah; Ahli Bank; Al-Khaliji Bank and International Bank of Qatar (IBQ), which between them had 16 Islamic banking branches in Qatar.

It seems that International Bank of Qatar has sold off its Islamic unit to Barwa Bank.
There are no reports about what the other conventional banks, mainly giants like the Qatar National Bank (QNB), are doing with their Islamic operations.
Someone familiar with the mather said, however, that acquisitions of Islamic units of commercial banks are expected to follow Al Yusr's buyout by Barwa Bank.