Qatar sold QR50bn ($13.7bn) of bonds to local banks as the country seeks to absorb excess cash with lenders.
The bonds, both Islamic and non-Shariah compliant, mature in three years, Central Bank Governor HE Sheikh Abdullah bin Saud al-Thani said in a phone interview yesterday. The conventional bond pays 5% interest.
The country sold QR33bn in sukuk and QR17bn of conventional bonds, Doha Bank CEO R Seetharaman said in an interview.
Qatar, which won the rights to host the 2022 football World Cup, is spending $100bn to improve infrastructure and raise its annual LNG export capacity. The country’s economy grew almost 15% a year between 2006 and 2008, before slowing to 9% in 2009. Growth is forecast at 16% in 2010 and 18.6% this year, driven by oil and gas prices and government spending, according to estimates from the International Monetary Fund.
The sale “will take out the excess liquidity in the market and for sovereign risk this is a good deal,” Seetharaman said. “The banks are happy.”
Qatar Investment Authority, the nation’s sovereign wealth fund, will complete increasing its stake in some of the banks to 20% in the first quarter, state-run Qatar News Agency reported on January 11, citing HE the Prime Minister Sheikh Hamad bin Jasim bin Jabor al-Thani.