September 20, 2018 / 3:04 PM / 3 months ago

UPDATE 1-Qatar's Commercial Bank says targets $750 million loan refinancing

(Updates with bank comment, changes headline)

By Davide Barbuscia and Tom Arnold

DUBAI, Sept 20 (Reuters) - Commercial Bank, Qatar’s third-largest lender by assets, aims to raise $750 million through a syndicated loan, a bank spokesman said on Thursday.

The deal would be the second significant syndicated loan raised by Qatari banks over the next few months, as sources told Reuters this week that Qatar National Bank, the Middle East’s largest lender, plans to refinance a 2.25 billion euro ($2.64 billion) facility due in May next year.

The Commercial Bank loan is “business as usual” and would be used to refinance an existing loan, the bank spokesman said.

Sources familiar with the situation told Reuters earlier on Thursday that the bank was seeking to refinance an existing $1 billion loan maturing in December this year.

Discussions for the refinancing are at an early stage, said the sources.

Following a plunge in oil prices in 2014 and the subsequent withdrawal of some government deposits from the banking system, Qatari banks have increasingly funded themselves through international bonds and loans.

But a diplomatic crisis which erupted in the Gulf last year has made some regional and international lenders more cautious about their exposure to Qatari borrowers.

Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut diplomatic and transport ties with Qatar in June last year. They accused it of backing terrorism, a charge that Doha denies.

The UAE central bank last year blacklisted some Qatari individuals and organisations and told its own banks to apply enhanced due diligence in their dealings with six Qatari banks: Qatar Islamic Bank, Qatar International Islamic Bank, Barwa Bank, Masraf Al Rayan, Qatar National Bank and Doha Bank.

Banks from the four Arab boycotting countries have pulled deposits from Qatar and reduced, though not ended, other business with it.

One of the sources familiar with the new loan discussions said it was not clear at this stage whether UAE lenders would participate in the deal, but that this was unlikely to be an obstacle to finding enough liquidity among lenders for the planned deal.

Commercial Bank’s existing $1 billion loan, signed in 2015, was provided by a group of 14 regional and international banks, according to Thomson Reuters data. The group included United Arab Emirates lenders National Bank of Abu Dhabi – now merged into a new entity, First Abu Dhabi Bank – and Union National Bank. ($1 = 0.8535 euros) (Reporting by Davide Barbuscia; Editing by Adrian Croft and David Evans)

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