Tag Archives: QInvest

QInvest announces new growth strategy

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Qatar-based investment bank, QInvest, has unveiled its long term growth strategy.

The new strategy involves splitting the bank into three separate divisions; investment banking, principal investments and asset management.

The restructuring is designed to create a greater focus on the firm’s core product and service offers.

QInvest has also strengthened a number of significant operation areas and plans to work more closely with the company’s largest shareholder, Qatar Islamic Bank (QIB), in order to access its unique market presence and network, and its strong balance sheet.

Tamim Hamad Al-Kawari, QInvest’s chief executive officer, said: “As investment markets around the world continue to evolve, it is essential that we further develop our strategy to build on our leading regional position and focus the business on the most lucrative market opportunities.

“We want to ensure we are structured to fully support Qatar and the wider region’s international investment plans as well as ensure we are recognised as the gateway for investors looking to access Qatar’s fast growing dynamic economy.”

As part of the strategy, QInvest’s asset management team plans to work more closely with QIB to offer its client base access to QMAP funds and services.

QInvest’s Managed Account Platform (QMAP), launched earlier this year, allows the firm to offer a diverse product range for global Sharia compliant investors.

The platform offers products across multiple asset classes, including sukuk and equity funds, managed by both in-house and third party professionals.

“In 2013, we focused on and have now completed the streamlining of the business,” said Al-Kawari. “Our top-line growth strategy ensures we concentrate on those areas where we have strength and market differentiation. We have brought in a team of proven experts and specialists and scaled specific product and service areas.

“At the same time, we are working closely with QIB to create value for both institutions through our strategic partnership. We are already beginning to see the benefits of the new strategy emerge and I am confident that this will continue to deliver value for clients and shareholders in the months and years ahead,” he said.

The asset management division has already launched a range of funds with major investment managers like GAM, Edgewood Management and Eagle Capital Management.

QInvest’s reorganisation and fresh approach comes after its proposed merger with EFG-Hermes, which would have created the Arab world’s biggest investment bank, collapsed in May after failing to gain approval from the Egyptian regulatory authorities.

EFG-Hermes JV deal with QInvest called off

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The planned joint venture between Egypt’s EFG-Hermes and Qatar’s QInvest has been called off after time ran out for Egypt’s regulator to back the deal.

The Egyptian Financial Supervisory Authority (EFSA) declined to grant its approval before the expiration of a 12-month deadline contained in the initial JV agreement last May. In a brief statement to the media, the regulator confirmed that it had rejected the request because of the limited expertise of the bidding company [EFG-Hermes Qatar LLC] and the need to maintain the safety and stability of non-banking capital markets in Egypt.

In a joint statement, the banks confirmed that the agreement had terminated and said that while they “remain open” to suitable shared business opportunities in future, they are now pursuing a separate course.

“The parties received the necessary financial services regulatory approvals in all other markets in which the joint venture was initially to operate including Qatar, the United Arab Emirates, Saudi Arabia, and Jordan, among others,” said the statement. “EFG Hermes and QInvest co-operated fully with all regulators, met all of their requirements and exercised the utmost diligence in addressing any regulatory requests in a timely and comprehensive manner.

“Both institutions look forward to separately creating value for their shareholders and remain open going forward to capitalizing on their complementary strengths to pursue together suitable business opportunities in a less-structured framework.”

The deal, which would have seen QInvest take 60% ownership of the joint body, would have involved EFG Hermes’ asset management, investment banking, brokerage, research and infrastructure fund businesses. The deal was seen as vital for Egypt’s biggest investment bank to shore up its capital and put the new entity on a sound footing to expand in the region. In the wake of the deal falling through, EFG Hermes said it would respond by selling non-core assets, while it seeks to implement a cost-cutting plan which will see costs reduced by 35% in 2014, a saving of around $40m.

“Revenue generation remains a top focus for all divisions with an increasing focus on regional growth opportunities while continuing to preserve our market share in our home market of Egypt,” said the bank. “A comprehensive cost-cutting plan is already in the implementation phase, with the first stage of those cost cuts already executed during the course of the first quarter of 2013. Further cost cutting measures are planned throughout this year with the goal of bringing our costs down to c. LE 500 million in 2014 from an estimated LE 780 million in 2013. This will ensure the Investment bank’s ability to perform amid unpredictable market conditions.

“There are several assets on the firm’s balance sheet that we consider non-core. We aim to shed those assets over the coming period and return most of the cash generated from those sales to our shareholders, all while preserving a well-capitalized balance sheet.

“Despite a challenging operating environment, EFG-Hermes has continued to perform well over the course of the past 12 months.”

EFG-Hermes’ asset management division has around $3.4 billion under management.