DOHA, April 9 (Reuters) - Doha Bank, Qatar’s fifth-largest lender by market value, plans to nearly double its profits from international operations by 2015, mirroring a strategy employed by other Gulf Arab lenders facing intense competition at home.
The lender, which raised nearly $430 million from a rights issue last month, aims to increase its share of profits from overseas business to 15 percent, from 8 percent currently, Chief Executive Officer, R. Seetharaman, said in Doha on Tuesday.
“We will set up a representative office and then look to convert it. I am not J.P. Morgan, so I have to gradually scale up,” he said.
The bank plans to open a representative office in Sharjah in the coming months, the third-largest emirate in the United Arab Emirates, as part of the expansion plans, Seetharaman said.
It recently opened an office in Australia, becoming the first Qatari lender to establish a presence in the country.
Gulf lenders, including the likes of Qatar National Bank (QNB) and National Bank of Abu Dhabi (NBAD), are facing intense competition in their home markets and are seeking to expand regionally.
QNB recently bought the Egyptian arm of Societe Generale in a $2 billion deal, while NBAD brought in the banker who led Australia and New Zealand Banking Group’s push into Asia as its new chief executive earlier in April to aid its expansion plans.
Doha Bank, 17 percent owned by the Gulf state’s sovereign wealth fund, the Qatar Investment Authority, is seeking to increase its share capital by 50 percent to help address a weak capital position and help boost expansion.
A quarter of the planned capital increase was raised through the share sale, while the bank plans to raise the remaining amount from a share offering in London.
“I have multiple options. If regulatory approval comes in, then fine. As and when it is required, we will go for phase two,” Seetharaman said about the remaining capital raising plan.
Doha Bank shares closed down 0.7 percent against a flat Doha bourse on Tuesday. (Writing by Dinesh Nair; Editing by Mark Potter)