Banks seek more time to shutter Islamic units

February 08, 2011 - 11:34:10 pm

DOHA: Qatar Islamic Bank (QIB), the country’s largest Shariah-compliant banking entity, has offered to buy the Islamic banking assets of conventional banks, while the latter want the banking regulator, Qatar Central Bank, to allow them more time to close their Islamic operations.

Banking industry sources pointed out yesterday that discussions were being held in the industry to convince the QCB that the time given to conventional banks to close their Islamic operations (by the year-end) is

not enough.

“The time allowed is too short. It is less than 11 months. This much time is actually needed to assess the impact of the closure on the affected banks and their customers,” said a source.

There are an estimated 80,000 to 100,000 customers of the affected branches many of whom transfer their salaries to these units and who have also taken long-term loans.

Pressure is also expected to be exerted by businessmen’s forums on the central bank to extend the deadline.

Wire agencies, meanwhile, quoting Ahmed Meshari, acting Chief Executive Officer (CEO) of QIB as saying that his bank is interested in the assets of Islamic operations of the affected conventional banks.

He was also quoted as saying that some 100,000 customers of the affected branches would migrate to Islamic banks in the country.

The Peninsula