We are unlikely to raise more than $2bn this year. Probably, we will get into the market by the third quarter of 2019, says Joseph Abraham
Commercial Bank has $2bn of maturities this year and will "renew and replace them" with fresh issuances for other forms of debt as required by its business and opportunities available, said Group CEO Joseph Abraham.
“We are unlikely to raise more than $2bn this year. Probably, we will get into the market by the third quarter of 2019,” Abraham told Gulf Times here.
The size of the issuances depends on market conditions, he noted.
Commercial Bank shareholders have given approval for fresh debt issuances by the bank, which include increasing the limit of an existing Global Commercial Paper and Certificates of Deposit (CP / CD) programme from $800mn up to $5bn; a new Global Medium Term Notes (GMTN) programme for up to $2bn; and the issuance of debt notes for up to $2bn under an existing $5bn Euro Medium Term Notes (EMTN) programme.
Abraham said, “It is a procedural requirement to get shareholder approval to issue up to a certain value, which we did at the general assembly meeting.”
Asked why Commercial bank opted for the CP / CD, GMTN and EMTN route for fund raising, the CEO said, “You have to diversify your sources of funding. And that is part of our whole plan. Especially, you need to meet investors on a regular basis. So, it is part of our regular interaction and meetings with investors.”
On the recent fall in Turkish Lira, Abraham said, “We are long-term investors in Turkey. We believe in the long-term potential of the country, and especially the very strong relationship between Qatar and Turkey is only going to lead to long-term opportunities for us.
The Turkish economy and currency have gone through some volatility in 2018.
“But we remain committed long-term investors in Alternatif Bank, injecting a further $50mn in capital into the business in 2018 and purchasing a new head office in Istanbul.”
(Commercial Bank owns 100% of Alternatif Bank’s shares. Commercial Bank became the majority shareholder in 2013 holding an initial 74.24% stake, completed a “put option" in December 2016 to purchase the remaining shares from Anadolu group)
“The lira will adjust according to the economic policies in the country. We are a long term investor in Turkey; we are not a short term fund, putting money for six months. To them the value of lira makes a big difference, but we are long term investors in Turkey” the CEO said.
Abraham said Commercial Bank has no immediate plans to close down any of its branches in Qatar.
“We constantly evaluate the market, our client base, new areas and adjust our footprint accordingly. We may move to more transaction-oriented banking. We are opening some branches in the Doha Metro. We see this as a developing footprint for different types of clients.
“We see more and more people transacting in digital. That is a trend worldwide. We will continue to invest (in 2019) with a long list of technological initiatives, new digital products to meet the needs of our clients and new branches aligned to our client footprint all planned for launch,” Abraham added.
