QNB and QIIB to link up with brokerage Southwest Securities to set up Islamic finance firm
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.
At present there is very little Islamic finance activity in China, but the country's population of Muslims is estimated at over 20 million so some bankers see room for the industry to develop.
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," Abdulbasit Ahmad Al Shaibei, 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 said 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.