Banks in Saudi, UAE have not received any regulatory guidelines on Qatar -sources

Banks in Saudi Arabia and the United Arab Emirates have not received any regulatory guidelines about their dealings with Qatari lenders despite the rift in diplomatic ties, sources familiar with the matter said.

The UAE, Saudi Arabia, Egypt and Bahrain cut diplomatic and transport links with Qatar on Monday, accusing it of supporting terrorism.

Bankers Reuters spoke to in Saudi Arabia and the UAE said they were waiting for guidance from their respective regulators before taking any action on Qatari business. In contrast, some Egyptian lenders halted business with their Qatari counterparts on Monday.

The UAE central bank did not immediately respond to a Reuters request for comment, while a spokesman for the Saudi central bank said it had no statement on the matter.

It was not clear what financial measures could be taken against Qatar, although some lenders in Egypt stopped accepting Qatari currency while others halted some treasury transactions, bankers told Reuters.

One of the sources in the UAE, speaking anonymously under briefing rules, said the UAE central bank was still weighing the financial implications of the diplomatic rift.

Another banker said the Saudi Arabian banking system had limited exposure to Qatar and that any curbs on dealings with Qatari banks would not have huge ramifications.

The impact of the rift could be more significant for Qatar National Bank (QNB), the Middle East’s largest bank by assets.

Last month it opened a branch in Riyadh and has been planning to apply for an investment banking licence. It also has a presence in Egypt, where it bought Societe Generale’s Egyptian business for about $2 billion in 2013, and holds a 40 percent stake in UAE-based Commercial Bank International.

QNB’s branch in Riyadh was quiet on Monday afternoon and the branch manager said business was carrying on usual.

A source familiar with the matter said QNB’s business in Saudi Arabia and Egypt was unaffected.

Source: Reuters

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