By Ghaida Ghantous and Dmitry Zhdannikov
DOHA - Qatar National Bank (QNB) QNBK.QA aims to increase its profit by 5-8 percent this year and loans and investments by 10-12 percent, helped by expansion into faster-growing Southeast Asia markets, its CEO told Reuters.
QNB, the largest bank by assets in the Middle East and Africa, is active in Egypt and Turkey and has made forays into Singapore, Vietnam, Myanmar, India, Indonesia and China.
“Our strategy and vision is to become among the leading banks in the Middle East, Africa and Southeast Asia. We have expanded our region to include Southeast Asia by 2020 and to be one of the main players in the Southeast Asia region,” said Group Chief Executive Ali Ahmed al-Kuwari.
The bank reported a 6 percent rise in annual profit to 13.1 billion riyals ($3.59 billion) in 2017.
QNB would look for markets that are growing faster than Qatar’s growth of 2-4 percent a year, Chief Financial Officer Ramzi Talat Mari told Reuters. Potential acquisitions should control at least 4-5 percent of the local market and have an internal rate of return of no less than 15 percent within three years.
Al-Kuwari said QNB had no plans to issue public U.S. dollar bonds in the near future despite still having room to do so under an approved program of up to $17.5 billion of international bonds, of which it has utilized only 60-70 percent.
“At the moment we don’t need it, we are very liquid,” he said.
QNB has recently used various types of debt instruments, including Kangaroo and Formosa bonds, to refill its coffers in an effort to diversify funding resources amid the embargo imposed on Qatar by other Arab states. QNB has borrowed over $2.3 billion through private placements this year.
Qatar, the world’s largest exporter of liquefied gas, is planning to expand its capacity by almost a quarter to 100 million tonnes from the current 77 million by adding new trains as well as building new petrochemical units together with global oil majors and other partners.
The projects are estimated to cost up to $40 billion and al-Kuwari said QNB would take an active role in lending to the new phase of Qatar’s hydrocarbon boom, which is set to power its economy for the next few decades.
“Qatar Petroleum has a lot of money... But in terms of financing, we want to take a bigger role in this. We are bigger now,” he said.
Editing by Louise Heavens