Qatar’s Commercial Bank may raise up to $1bn in debt in 2019
Doha — Qatar’s Commercial Bank could raise up to $1bn in debt in 2019 by tapping a range of debt instruments, as the country’s third-largest lender by assets aims to further diversify its funding sources, says the bank’s CEO.
Qatari banks, traditionally reliant on foreign funding, have sought to tap a larger variety of investors since June 2017, when Qatar became locked in a diplomatic dispute with Saudi Arabia, the United Arab Emirates, Egypt and Bahrain.
Commercial Bank has about $750m in debt maturing in 2019, including bonds and loans. It planned to refinance that debt in the “normal course of business”, Joseph Abraham said on the sidelines of a financial conference in Doha.
Abraham said that total debt issuance in 2019 could go up to $1bn.
The lender hired ANZ and Bank of America Merrill Lynch in November to arrange a series of fixed-income investor meetings ahead of a kangaroo bond sale, debt securities issued by foreign entities in the Australian market denominated in Australian dollars.
Abraham said the bank would look at Kangaroo bonds and also at the Taiwanese bond market and the Japan bank debt market.
“We might look at more diversified options in terms of geography, tenor, product type, and investor type.”
Commercial Bank said on Sunday it had signed a $750m syndicated loan. The bank received $950m in subscriptions, Abraham said.
Commercial Bank is exploring the sale of its 40% stake in Abu Dhabi-listed United Arab Bank, but the CEO said the bank was in “no hurry” to complete the deal.
“We do get indications of interest, but we are not going to sell at any price… We’re focused on turning the bank around, making sure it delivers greater profit and that will automatically enhance its value,” said Abraham.
Commercial Bank has said it is not being pressured to sell as a result of the Gulf rift and is planning to reinvest the proceeds from the sale into its business in Qatar and Turkey, where it owns Alternatifbank.