By Alex Delmar-Morgan, Dow Jones Newswires
DOHA (Zawya Dow Jones)--Private sector demand for financing in Qatar is weak but will pick up as the government's recently announced $100 billion ten-year infrastructure spending plan kicks in, the chief executive of private Qatari investment bank QInvest said Thursday.
An interest-rate cut by the Qatar central bank last week was aimed at stimulating private sector lending, Shahzad Shahbaz told Zawya Dow Jones in an interview Thursday. "The banks are willing to lend, I think it's a question of the demand for financing," he said.
Last week the central bank slashed one of its key interest rates for the second time in eight months in a bid to invigorate private sector credit growth. It cut its overnight deposit rate from 1.5% to 1% and also reduced its repurchase, or repo, rate by 55 basis points to 5%.
Asked whether there were many companies wanting to raise
money Shahbaz said: "No, that's one of the challenges.
That's why the government is pushing down rates to get the
activity going."
Doha based QInvest, which has paid up capital of $750
million, will focus on growing its core investing banking
and investment management divisions in 2011 and also plans
to open a new broking arm in "a few weeks" time, its CEO
said.
It hopes to an open an office in Saudi Arabia in the third quarter of this year and is considering opening a branch in Abu Dhabi as well.
The company's plan for an initial public offering, or IPO, in the first half of 2012 is dependant on "market conditions", Shahbaz said.