Steve Troop (left), Chief Executive Officer of Barwa Bank, and Khalid Al Subeai, Chief Executive Officer of The First Investor (TFI), during an interview with Reuters in Doha yesterday.
DUBAI: Barwa Bank, a Shariah-compliant lender, expects a sharp increase in its 2013 net profit, driven mainly by billions in infrastructure spending by the state and growth in its debt advisory and asset management business.
“For the first half of 2013, we were 85 percent up on the same period last year. And for the full year we’re moving along very strongly and expect a positive and material improvement in net profit over 2012,” Chief Executive Steve Troop said in an interview as part of the Reuters Middle East Investment Summit.
The unlisted lender is awaiting regulators’ approval for a public floatation as part of two share sales planned to raise more than QR2.05bn. It posted a profit of QR345m ($94.75m) for 2012, a 41 percent increase from the previous year.
The four-year old bank, effectively controlled by an arm of Qatar Investment Authority (QIA), is seeing a pick-up in infrastructure development in the country after a slowdown in the last two years, Troop said.
Qatar launched plans to spend about $140bn over the next decade on a rail system, a new airport, a seaport, and hundreds of kilometres of major new roads, in addition to stadiums that will host the 2022 World Cup soccer tournament.
Barwa outlined a fundraising plan in April which includes the public issue and a similar sized rights issue to existing shareholders. “We understand that stock market regulators want to manage the runway and make sure we’re not all trying to go public on the same market at the same time so we’re waiting for the appropriate time slot,” Troop said.
“We are in contact with the authorities to liaise on the perfect timing,” he added.
Barwa Bank is 37.3 percent owned by Barwa Real Estate Co while Qatar Holding has a 12.1 percent stake. The remaining shares are owned by several individuals and corporations, according to the bank’s results statements.
Barwa Bank, through its fully-owned investment banking arm, The First Investor (TFI), plans to partner with local investors in Qatar to invest in the healthcare sector, TFI Chief Executive Khalid Al Subeai said in the interview. “We’re focused on Qatar and we are looking to replicate our venture in the education sector into the healthcare sector,” Al Subeai said.
The bank in June set up an education company in Qatar and is now developing two private schools at a cost of QR230m, yielding 8 percent annually, he added. The bank also manages a Shariah-compliant Gulf equities fund, with QR113m in assets.
The fund has returned 19 percent to investors since inception in late 2012.
“We continue to see AUMs (assets under management) grow as we see the Gulf equity markets are more attractive for investors compared to money market products and the sukuk space,” Al Subeai, who previously ran Morgan Stanley Inc’s business in Qatar, said.