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Wed 16 Apr 2008 10:46 AM

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Qatar bank allows 49% foreign ownership

Islamic bank Masraf Al Rayan increases foreign ownership limit to tap global interest.

Qatari Islamic bank Masraf Al Rayan is raising the ceiling on foreign investment in its stock to 49% from Wednesday, as firms across the Gulf Arab region seek to tap growing global interest.

Shareholders of Masraf approved raising the foreign ownership limit from 39% at a shareholders meeting on Tuesday, the bank said in a statement on the Doha bourse website site.

Gulf Arab bourses are easing restrictions on foreigners owning their stock after a regional market crash in 2006, when the Doha index was one of four regional benchmarks that fell more than 35%.

Qatar's stock exchange held a roadshow in London in November to attract more foreign capital, while markets in the UAE made similar presentations last year.

Shares of Masraf have risen almost 10% this month and had surged to an 11-month peak in October after the government agreed to allow the lender to raise its foreign ownership limit to as much as 49%.

Islamic banks cater to Muslim investors who want to avoid earning or paying interest, viewed as usury under Islamic law.

Moody's Investor Service said in February that global assets complying with Islamic law have grown 15% each year for the last three years.

Assets could grow by another third to more than $1 trillion by 2010, management consultants McKinsey & Company said in December. (Reuters)

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