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Commercial Bank of Qatar to issue bonds
The Commercial Bank of Qatar had laid out plans to raise QAR2 billion or USD549.3 million through the sale of bonds in December. The purpose of the bond sale is to replenish capital reserves that have been depleted when the bank acquired the majority shareholdings in a financial institution based out of Turkey.
Just recently, Qatar's third largest bank in terms of assets had reported a 48.7% loss in third quarter net profit because of higher loan servicing requirements. With the report, the bank had missed the analyst market's average forecast for the bank.
Like many other financial institutions based in the Gulf region, CBQ had been looking to offset the increased competition in Qatar coming from foreign competitors. The most recent acquisition was the bank's purchase of 70.84% in Alternatifbank of Turkey from July. Another 3.4% was added as a purchase in September.
This CBQ perpetual bond sale requires the approval of its shareholders and the country's regulatory authority. With the bond sale, it would be boosting the bank's capital ratios by 2.2 percentage points through a separate statement.