Qatari Banks in Talks to Form Sharia-Compliant $44-bn Megabank

Qatar's Emir Sheikh Tamim bin Hamad al-Thani attends the 4th Summit of Arab States and South American countries in the Saudi capital Riyadh, on November 11, 2015. The summit aims to strengthen ties between the geographically distant but economically powerful regions. AFP PHOTO / FAYEZ NURELDINE / AFP / FAYEZ …
FAYEZ NURELDINE/AFP/Getty

DOHA (AFP) – Three Qatari banks announced Tuesday that they are in merger talks to create a financial institution with assets of more than $44 billion.

Masraf Al Rayan, Barwa Bank and International Bank of Qatar said the potential merger would create the third largest Sharia-compliant bank in the Middle East, in a statement released to the Qatar Stock Exchange.

The banks had entered “initial negotiations”, they said, without giving a timeframe for a merger.

“The merger is… expected to contribute positively to the economic development in the State of Qatar by supporting business and small and medium sized entities, and would also create a strategic partner for the government and the public sector,” they said.

The planned consolidation comes at a time when Qatar has been hit by low energy prices and the soaring costs of hosting the 2022 football World Cup.

Last week, the gas and oil-rich emirate approved a 2017 budget with a deficit of more than $7 billion.

.