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Mon 14 Sep 2015 07:46 PM

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Saudi cabinet grants licence to Qatari bank for first time

Announcement comes less than a week after Qatar's central bank announced it would grant licences to fellow GCC banks

Saudi cabinet grants licence to Qatari bank for first time
Qatar National Bank

The Saudi Council of Ministers granted a licence for Qatar National Bank to open a branch inside the kingdom, the official SPA news agency said on Monday, in what would be its first licence awarded to a Qatari lender.

The announcement came less than a week after Qatar's central bank announced it would grant licences to fellow Gulf Cooperation Council banks to open branches, adding to the one Gulf lender - Dubai-based Mashreq - out of seven existing foreign institutions operating there.

Banking licences are usually granted on a reciprocal basis among GCC countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

Out of the 12 foreign banks licensed to operate in Saudi Arabia, five are Gulf lenders - two from Bahrain and one each from Kuwait, the UAE and Oman. Other foreign lenders include JP Morgan, Deutsche Bank and Morgan Stanley .

The move signals a further thaw in Saudi-Qatari relations, which have warmed in the past year following long-standing political disagreements over regional security.

The rift reached its nadir in March 2014, when three Gulf countries, including Saudi Arabia, withdrew their ambassadors from Qatar alleging it supports Islamist groups, particularly the Muslim Brotherhood.

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