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DUBAI, March 5 (Reuters) - Qatar Central Bank is evaluating legal, financial and technical information related to a three-way bank merger that is expected to create the country’s second largest lender, a Qatari newspaper reported on Monday.
Executives at Masraf Al Rayan, Barwa Bank IPO-BABK.QA and International Bank of Qatar had missed an end-2017 target date to complete the merger plans, which sources familiar with the matter had said enjoyed the support of shareholders.
A shake-up has long been mooted in the Qatari banking sector given that 18 local and international commercial banks serve a population of 2.6 million.
The argument for consolidation has become more compelling now that lower oil and gas prices have trimmed state spending, curtailing deposit growth and revenue generation.
The Arabic-language Lusail newspaper said that Masraf al-Rayan chairman Hussain al-Abdulla had announced last week that studies related to the mergers had been completed and sent to the central bank, which had appointed JPMorgan to provide technical advise.
The newspaper quoted unnamed sources as saying that a feasibility study of the merger which included the impact on the three banks’ shareholders, customers and employees has already been prepared.
“According to Lusail’s information, the Qatar central Bank governor is expected to issue his initial decision within a few days, that will include the conditions, guarantees and measures that are required to be completed before a final verdict on the merger,” Lusail said.
It said a final decision will only come after all procedures are completed, including the three banks obtaining a consensus from shareholders at an extraordinary meetings of their general assemblies. (Reporting by Hadeel al-Sayegh, writing by Sami Aboudi Editing by Shri Navaratnam)