Qatar fund buys another 5 per cent stake in country's banks for $549 million
01 Jan 2010
Qatar Investment Authority (QIA), the country's $65 billion sovereign wealth fund, has acquired another 5 per cent stake in the country's banks for $549 million to help them recover from the global financial crisis.
In October 2008, during the peak of the global economic crisis, the QIA said it would buy 10 to 20 per cent of the country's listed banks' capital in order to increase the banks' liquidity and shore up their balance sheets.
Qatar's minister of economy and finance Yousef Hussein Kamal had said a fortnight back that the country will spend $900 million on buying the stakes by end-2009 so that the money can be accounted in the bank's balance sheets by year-end.
The initiative will help in "further strengthening the capital ratios of the banks in order to enhance their ability to face the repercussions of the global financial crisis," Qatar's English-language daily, The Peninsula, said, citing the minister.
The minister added that the money injected into the country's banks would help them to finance development projects.
In October 2008, the QIA released $5.3 billion - the first tranche of capital injection initiated by the government to prop up the country's banks that like their global counterparts had to be bailed out by their respective governments.
Business Monitor International, the specialist business information company on global emerging markets, had said that Qatar's gross domestic product (GDP) will see an average growth of 7.5 per cent between 2009 and 2013, with GDP in 2010 projected at around 13.3 per cent.
Most of its growth will come from the massive hydrocarbon sector, which has seen the setting up of the QIA in 2005 with money from sale of gas, estimated to be the world's third largest.
