DOHA: QIIB, one of Qatar’s leading Islamic banks, yesterday announced its plans to issue Sukuk worth QR1bn ($274.6m) by the end of this month to raise the Bank’s Tier 1 Capital to maintain a higher Capital Adequacy Ratio.
A higher capital adequacy will not only help the Bank’s risks absorption capacity but also promote financial stability and efficiency, Abdul Basit Ahmed Al Shaibi, Chief Executive Officer of QIIB, said yesterday.
“This issuance is to raise QIIB’s Tier 1 Capital, which will support the Bank’s equity fund and strengthen its ability to finance different projects. The fresh capital will help QIIB maintain a higher Capital Adequacy Ratio of about 25 percent against the current 17 percent,” Al Shaibi told The Peninsula on the sidelines of the Bank’s Extraordinary AGM yesterday.
He added: “In fact, the shareholders of the Bank ratified the decision to raise capital last year, but so far we have not issued any Sukuk. By the end of this month we are expecting to raise QR1bn through a targeted single institutional investor based in Qatar.”
During last year’s AGM, QIIB shareholders had approved the Bank’s proposal to raise up to QR3bn through Sukuk issuance to support the bank’s capital requirements for future growth and expansion.
QIIB, which currently operates about 17 branches across the country, also unveiled its plan to open at least three more branches in the upcoming shopping centres, including the Mall of Qatar and Doha Festival City.
About the Bank’s overseas expansion plans, Al Shaibi said that QIIB has set up joint a venture in Morocco with a local partner, and expecting to obtain a licence before the end of this year to offer Shariah-compliant banking services to customers in the North African country. But he remained tight lipped about the scale and the number of branches QIIB set to begin its operation in Morocco.
In addition, the Bank is also exploring investment opportunities in other promising markets, but the CEO said that “disclosing any details about it would be premature”.
Commenting about the impact of the failure of negotiations at a recent meeting of major oil producing countries in Doha to freeze output, he said: “Qatar economy is very vibrant and dynamic, which can sustain the current level of oil prices for long. So there should not be any worry. However, there are challenges but there are a lot of opportunities as well.”
The Bank yesterday held its Extraordinary General Assembly at Diplomatic Club, which was presided over by Sheikh Dr Khalid bin Thani bin Abdullah Al Thani, Chairman of the Board of Directors. The shareholders of the Bank approved all the items on the agenda, including the amendment of the Bank’s Articles of Association in accordance with the Commercial Companies Law No. 11 of 2015 and the reference model issued by the Ministry of Economy and Commerce.
