Qatar central bank to issue $1.9bln debt

  • Share via facebook
  • Tweet this
  • Bookmark and Share

Qatar's central bank said on Sunday that it would issue 4 billion riyals ($1.1 billion) of local currency sukuk and 3 billion riyals of local currency conventional bonds, as part of an adjustment of monetary policy and in order to help commercial banks meet Basel III liquidity requirements.

The central bank did not give the time period for these issues; it said the timing would be announced later. Local currency debt will be issued every quarter, half with three-year maturities and half with five-year, it said in a statement.

"The aim of issuing these bonds is to develop monetary policy and the implementation of a mechanism of coordination between monetary and fiscal policy and support the strength of the banking system and financial and market tools," the central bank said.

Last Thursday, the state-run Qatar News Agency reported that the central bank would sell a combined 4 billion riyals of three- and five-year bonds and sukuk. There was no explanation of why the QNA report differed from the central bank statement.

In January, the International Monetary Fund's mission chief for Qatar told reporters that authorities planned debt issues to build a domestic sovereign yield curve, as part of the country's efforts to develop a local currency debt market.

The issues will help the world's top liquefied natural gas exporter manage excess liquidity in the banking sector that has been created by rapid economic growth; liquidity may be boosted further by the country's massive infrastructure building programme, which is due to accelerate this year.

Qatar has issued local currency bonds before. In January 2011, the central bank issued a 50 billion riyal, three-year bond directly to local banks as a step to drain excess money from the banking system.

In addition, the central bank launched monthly auctions of 91-, 182- and 273-day Treasury bills in May and August that year to soak up excess funds.

As a result, available liquidity dropped to a mere 5.8 billion riyals at the end of 2011 from 73.2 billion riyals a year before, the central bank has said.

Related:
Companies
Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

Please post responsibly. Commenter Rules

  • No comments yet, be the first!

Enter the words above: Enter the numbers you hear:

All comments are subject to approval before appearing

Further reading

Features & Analysis
Finance talk with RAKBANK

Finance talk with RAKBANK

StartUp sat down with RAKBANK’s head of personal banking, Ian...

Tips from the top: Hisham Al Gurg

Tips from the top: Hisham Al Gurg

High profile investor and entrepreneur Hisham Al Gurg discusses...

1
The hubsters' ecosystem

The hubsters' ecosystem

Tamara Pupic visits Impact Hub Dubai, the first local branch...

Most Discussed
  • 24
    World's most pierced man refused entry to the UAE

    Tolerance has its limits everywhere including Dubai and those who considered Dubai a lawless circus were held accountable...so thank you Dubai authorities... more

    Thursday, 21 August 2014 10:51 PM - Khalil
  • 23
    Baby NOT on board?

    Some of you cry babies need to get your own personal apartments on the plane ! You cry more then the babies I have seen in my travels. LOL more

    Thursday, 28 August 2014 9:10 AM - Jim
  • 21
    Israel “must be punished” over Gaza, says Dubai police chief

    This high moral ground that Mick is talking abt sound very familiar. May I remind Mick that the US & its British ally alone killed over 1 million innocent... more

    Thursday, 7 August 2014 4:12 PM - Mathew