June 19, 2017 / 12:01 PM / a year ago

Qatar Financial Centre says it plans no reprisals over sanctions

DOHA, June 19 (Reuters) - The Qatar Financial Centre (QFC) does not plan to take any action against Saudi Arabian, United Arab Emirates or Bahraini firms in response to their governments’ sanctions against Qatar, the QFC’s chief executive told reporters on Monday.

“We do not intend to take any measures on any businesses in Qatar from the blockade countries. We have Saudi and Bahraini banks in the QFC,” Yousef al-Jaida said.

“It remains business as usual, and we intend to keep it that way. There are five companies at the QFC from Saudi and Bahrain.”

The QFC licenses foreign companies to exempt them from the Gulf state’s local ownership laws. The centre has its own legal, regulatory, tax and business infrastructure, allowing for 100 percent foreign ownership and full repatriation of profits.

Jaida said institutions from Saudi Arabia, the UAE and Bahrain had about $18 billion of short-term deposits in Qatari banks that would mature in two months.

If necessary, the Qatari government will step in to cover those funds if they are withdrawn, and other banks in the QFC are still providing short-term U.S. dollar deposits to Qatar’s banking sector, he said.

“Whether the blockade countries make a decision on retracting those deposits is yet to be seen. Those mature in a couple of months, so there’s no impact as of yet. This is a measure we are paying close attention to,” Jaida said.

“If that happens the government can step in. We witnessed a worse crisis in 2008, a financial crisis. If the need arises, the government will be able to step in and buy out the default portfolios of loans.” (Writing by Andrew Torchia; Editing by Hugh Lawson)

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