QCB Governor Says Qatar Banks Record Good Growth in 2015

Doha, March 07 (QNA) - HE the Governor of Qatar Central Bank (QCB) Sheikh Abdullah bin Saud Al-Thani said Qatar's banks recorded healthy growth in 2015 with their assets jumping to QR 1.11 Trillion spurred by non-oil sector gains. In an interview with 'Lusail' newspaper published today, HE the Governor of Qatar Central Bank expected banks to maintain this growth in 2016 as their high capital adequacy ratios and low level of non-performing loans buffered them market swings. He told the newspaper assets of banks registered good growths in 2015. The assets jumped to QR 1.11 Trillion from QR 910 Million in 2013 and QR 1.004 Trillion in 2014. Credit facilities and investment in government securities rose to QR 748.7 Million at growth of 14.1%. The capital adequacy ratio registered around 15.6%, and the level of non-performing loans was no more than 1.5%, which is a low level and below the level of such loans compared to the previous year, the Governor said. He said linking the Qatari Riyal to US dollar since the 1980s and its official linking from the beginning of this century, boosted Qatar's economy over the past decades. Most of Qatar's general revenues accrue from oil and gas exports which are priced in US dollars in international markets. Therefore, the fixed exchange rate system of the Qatari Riyal linked to US dollar helps achieve stability in Qatar's public revenues. He also ruled out fears of the dollar declining globally saying the US is the strongest economy in the world, and the depreciation of the US dollar's exchange rate against some international currencies are predominantly with simple rates and for limited periods. He said he cannot imagine the dollar exchange rate collapsing as it happens to other currencies. Qatar's long experience in linking riyal to the US dollar has shown that it is the best for its economy. The link to the US dollar has helped the Qatar avoid many risks associated with global exchange rates fluctuations, and contributed to a large reduction of imported inflation ratio, which in turn led to a decline in domestic inflation, the Governor said. HE the Governor of Qatar Central Bank Sheikh Abdullah bin Saud Al-Thani said that QCB issued Islamic bonds and sukuk valued at QR 22 Billion in 2015. All banks issued the bonds and sukuk of terms ranging from three, five, seven to 10 years. The QCB has taken a number of measures to develop the capital market such as regulatory norms, supervision, boosting risk management of financial institutions and raising the level protecting investors. The new issues of bonds, sukuk and debt instruments with a record on Qatar Stock Exchange were introduces with the new measures, he said. Speaking about the decline in oil prices, the Governor said that banking sectors in the Gulf Cooperation Council are able to benefit from the abundance of liquidity because they directed a part of oil revenues as deposits. With the drop in global oil prices, the banking sector cannot depend entirely on this reserve of cash. So in order to support sustainable growth in the economy in general, investments in non-oil sector should be increased, he said. Also, the gap in the financial budgets must be funded either by withdrawing deposits or by borrowing from the domestic or international markets. On Islamic financial institutions operating in Qatar, he said QCB adopts a comprehensive approach to supervise these institutions based on many parameters. Recently, a unified control authority was formed in co-ordination with the four Islamic banks licensed by the QCB to help achieve the issuance of a standard procedural guide for Islamic finance. This includes legitimate and legal controls for financing, disputes and other banking services, he said. (QNA)