Banking & Finance
Qatar National Bank, Mideast’s Biggest Lender, Focuses on Southeast Asia to Expand
(Bloomberg) –Qatar National Bank is putting Southeast Asia as the focus of its expansion, the chief executive officer of the Middle East’s biggest lender said.
“Our focus really was the Middle East and then we expanded to Southeast Asia where we’re now focusing,” Abdulla Al-Khalifa said in an interview with Bloomberg TV. “If we find the right opportunity for acquisition, we will consider it,” he said, adding there are no deals currently under review.
Lower oil prices are forcing Gulf lenders to consolidate and look for business outside their home markets. QNB has been expanding with the purchase of National Bank of Greece SA’s Turkish unit and Societe Generale SA’s Egypt subsidiary. The bank’s regional growth has been curtailed as Qatar has been locked in a standoff with Saudi Arabia, the United Arab Emirates, Bahrain and Egypt since mid-2017.
Expanding abroad is part of how the bank will continue growing despite the small scale of Qatar’s local market, Al-Khalifa said. “We know that Qatar, at one point in time, will not be itself sufficient to satisfy our expansion growth, or the growth potential that we have.”
Gas-rich Qatar is home to about 2.8 million people and QNB has roughly half the market share. The lender reported record profit in 2019, helped by higher interest income.
Al-Khalifa was promoted to QNB’s top job in December after 13 months as acting CEO and more than two decades working for the lender. The shares have gained 1.7% this year after posting a 5.6% advance in 2019.
Al-Khalifa also said:
- The reduction in real estate value in Qatar is a “very healthy” correction; the bank has changed the way it finances real estate investments to consider a period of 12-15 years instead of 6-8 years
- The CEO sees the bank continuing to build credit growth in the private sector, particularly services, trading and contracting; also expects the bank to help finance new liquefied natural gas facilities
- He is encouraging consolidation among competitors and would like them to be bigger
- QNB’s branch in Saudi Arabia is up and running, but doesn’t do much business because of circumstances. Kingdom remains a big market for the bank and “when things get resolved we will be in Saudi and we will be active”.
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