Qatar's Barwa Bank plans to issue a sukuk by 2013 and is eyeing a share listing over the longer term, according to its chief executive.
The Islamic lender, a unit of Barwa Real Estate, sees an issuance as helping smooth out maturities in the state, which plans to invest about $130 billion in its non-hydrocarbon sector through to 2018.
'Deposit markets across the Gulf are very much dominated by short-term money. Much of what we're doing in terms of projects is of medium and long-term maturity. That creates an asset-liability mismatch, which poses a real management challenge,' CEO Steve Troop told Reuters in an interview.
'In that context, we're keen to do an issuance by 2013. Though not yet rated, the company intends to acquire a rating this year, Troop said.
Pursuing a share listing 'is a direction of travel, it is a broad commitment and an aspiration. There are a number of processes we need to get through first,' he said.
The company completed a QR1.7 billion ($466.8 million) rights issue earlier this year aimed at funding the bank's expansion.
Though Qatar - with nearly 20 lenders including European behemoths HSBC and BNP Paribas - is viewed as highly overbanked, Troop said he did not see any appetite for consolidation within the state.
'Consolidation has always been a cost play, not an income play. Costs come into focus when revenue is under pressure, and it is not right now. The country's banks' revenue is growing strongly. Pressure from the shareholders and boards just isn't there.'
'Yes, Qatar is a very congested marketplace. But is it overbanked in terms of the capital required to support the country's very ambitious projects? One might suggest that it is appropriate.'
Incumbents within the marketplace will need to focus on differentiation, he said. 'We're not going to be a mass-market retail bank. We see ourselves as a highly focused niche player, delivering to affluent residents of Qatar. We started a private banking initiative last year, and we're very pleased with the results so far.'
'We also see real opportunities in terms of Islamic wealth management, which we feel can be a lot more sophisticated.'
The company has been active in the regional debt market recently as a lead arranger on Saudi Arabia's Islamic Development Bank's $800 million sukuk earlier this month, as well as the Dubai government's $1.25 billion issuance in April.
Barwa Bank acquired the sharia-compliant retail banking business of International Bank of Qatar last August for an undisclosed amount, following the central bank's edict banning conventional banks from offering Islamic banking services.
Troop said the bank was in talks with other potential issuers. 'We expect to see increasingly more dual tranche (Islamic) issuances across the region,' he said.