Single regulatory body for banks, insurance firms

December 04, 2012 - 3:04:30 am

DOHA: Banks, financial services companies, exchange houses, the Qatari bourse as well as insurance providers, including banking, financial and insurance entities registered with the Qatar Financial Centre (QFC), are to be brought under the ambit of a single regulatory agency.

Qatar yesterday issued a law that clears the decks for setting up the historic umbrella regulatory body for the above sectors.

The Emir, H H Sheikh Hamad bin Khalifa Al Thani, issued law Number 13 of 2012 to regulate the Qatar Central Bank (QCB) and “Financial Authorities”, Qatar News Agency (QNA) reported.

According to Al Sharq, the new legislation makes way for setting up a single regulatory authority for the above sectors and the authority is to be placed under the QCB. Currently, insurance and reinsurance companies are regulated by the Ministry of Business and Trade, while the Qatar Exchange (the bourse) is under a separate regulatory agency—the Qatar Financial Markets Authority (QFMA).

Mainstream banks and financial services companies as well as exchange houses are regulated by the QCB, while the QFC has several foreign bank branches and financial services companies registered with it.

All these entities are to be placed under a single regulatory body and this body is to be placed under the QCB, whose capital base will also be expanded massively as provided by the new law.

The capital of the QCB presently is QR5bn ($1.37bn) but the banks and financial institutions it regulates have capitals collectively totalling QR105bn ($28.76bn), the daily said.

This necessitates that the capital base of the QCB be broadened so as to help it to keep pace with the changing scenario. The GDP (gross domestic product) of the country is also expected to soar to a staggering QR700bn ($191.78bn) by year-end.

The new law is to take effect immediately and is to be published in the official gazette, QNA said. The legislation amends Law Number 33 of 2006.

New regulatory guidelines are expected to be issued particularly for insurance and reinsurance companies and exchange houses, Al Sharq said.The Peninsula