QNB and QIIB sign QR1bn Ijara agreement

The Peninsula: QNB Al Islami, the Islamic branch of Qatar National Bank (QNB), Qatar International Islamic Bank (QIIB) and Qatar Real Estate Investment Company (ALAQARIA) announced the signing of a Shariah-compliant finance agreement by which the two banks will provide ALAQARIA with Ijara finance of QR1bn. The funds will play an instrumental role in the future development of ALAQARIA projects in Qatar.

The agreement was signed by Ali Shareef Al Emadi, QNB’s Group Chief Executive Officer; Abdul-Baset Ahmad Al Sheibei, CEO of QIIB; and Sheikh Khalid bin Khalifa Al Thani, Chairman of ALAQARIA. The Islamic financing, which has received the approval of the Shariah Boards of both QNB Al Islami and QIIB, comes into effect on January 1, 2009. QNB Al Islami will contribute QR700m and QIIB will contribute QR300m respectively to the finance pool.

“This is a landmark transaction that indicates the robust outlook for real estate projects in Qatar, as well as demonstrates the sophistication of the nation’s Shariah-compliant finance market. We are very pleased to be part of this facility which will help ALAQARIA reinforce the strong infrastructure for growth already in place in Qatar, and help build the foundations for innovative corporate and project finance using Islamic finance,” Al Emadi said.

Abdul-Baset Ahmad Al Sheibei, CEO of QIIB, said: “We are pleased to be part of this partnership which will contribute to the sustainable growth recommendations made recently by H E the Prime Minister who encouraged further construction work and investment in large-scale projects both in infrastructure and other sectors to enhance the strength of Qatar”s economy.”

Al Sheibei added: “Collaboration with a leading real estate company in Qatar is a positive step on part of QIIB to take a role in the development of Qatar’s economy and an essential part of QIIB’s drive forward, which is clearly reflected in the quality of the partnership launched between QIIB, QNB Al Islami and ALAQARIYA.

Sheikh Khalid bin Khalifa Al Thani, ALAQARIA Chairman, said: “Once completed, the financing package will play an instrumental role in our next phase of growth as we forge ahead in addressing the urban needs of Qatar. We are committed to our clients in the oil and gas sector, and we will start new developments by end of this year and early next year with budgeted cost of approximately QR2.5bn. We are happy to be working with leading financial institutions such as QNB and QIIB for this financing, and we are always committed to the Islamic Compliant solutions”.