Qatari banks ink deal for Islamic finance venture in China

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Friday 17 Apr 2015 - 21:04 Makkah mean time-28-6-1436 Qatar National Bank opens in China (Google image) Doha, (IINA) - Two Qatari banks and Chinese brokerage Southwest Securities signed a memorandum of understanding on Tuesday to establish a company handling Islamic finance deals in China, Arabian Business reported. The new company will help the two banks, Qatar National Bank and Qatar International Islamic Bank (QIIB), to access China's markets for financing and investment, directly or indirectly, Qatari executives said. It will also aim to develop Islamic finance in China and support southwest securities in accessing markets in Qatar and the Middle East, they said. Details of the size of the company and when it would start operating were not disclosed. "We want to help China set up a framework for Islamic finance or direct investment," Abdul Basit Ahmad Al Shaibi, QIIB's chief executive, told reporters. "We also want to encourage Qatari banks to have a presence in China." He added, "What we saw from the Chinese side is that there is demand for Islamic finance, and the Chinese are looking for ways to export Islamic finance beyond their borders, as well to countries in their region with large populations of Muslims." China's AVIC Capital Co revealed in late December that its unit AVIC Securities had signed an agreement to advise the government of the country's Ningxia Hui Autonomous Region, which has a large population of Muslims, on the global issue of up to $1.5 billion worth of instruments such as Islamic bonds and US dollar bonds, with maturities of up to five years. Since then, no concrete progress towards an issue has been announced. Islamic banks have proved a success because of rules that forbid investing in collateralized debt obligations and other toxic assets that cause financial crises, OnIslam reported. The Islamic banking system is being practiced in 50 countries worldwide, making it one of the fastest growing sectors in the global financial industry. Starting almost three decades ago, the Islamic banking industry has made substantial growth and attracted the attention of investors and bankers across the world. SM/IINA