Doha Bank sees no layoffs in Islamic business

Doha Bank sees no layoffs in Islamic business

Islamic bank employees retained, excess staff redeployed; Creating new project and risk advisory division at bank

May 24, 2011 3:00 by Reuters

Doha Bank will not lay off any employees impacted by the Qatar central bank’s ban on conventional banks engaging in Islamic finance, its chief executive said on Monday.

Raghavan Seetharaman said the bank will honor existing commitments from Islamic business undertaken before Qatar’s decision.

“We have committed billions of riyals that we have to go ahead and finance. There is no stopping on that,” Seetharaman told Reuters on the sidelines of a conference in Abu Dhabi.

Seetharaman said the bank will retain its Islamic branch employees to oversee the sharia-compliant business it currently has but is not writing new business. He added that excess staff has already been deployed to its conventional operations.

In February, Qatar’s central bank asked conventional lenders to close down their Islamic operations amid worries of overlap between the two.

The order gave lenders a grace period until Dec. 31 to shutter operations but did not provide clarity on whether banks can apply for separate Islamic banking licences or be permitted to sell assets to Qatar’s wholly-Islamic banks.

Islamic operations accounted for around 11 percent of Doha Bank’s total book value, Seetharaman said in February.

Separately, Seetharaman said Doha Bank will be hiring additional staff as it sets up a new project and risk advisory division.

“Project and risk advisory, that is the new division we are creating. It is at the first stage, and there has been a good response. We are going to work on it.”

(By Martina Fuchs; Writing by Shaheen Pasha; Editing by Amran Abocar)