HSBC is asking Qatar’s central bank to clarify an order requiring non-Islamic lenders in the nation to end services that comply with Shariah law.
HSBC Amanah, the Islamic banking unit of London/Hong Kong-listed HSBC, is in discussions with the central bank, the firm told This publication. HSBC has had operations in Qatar since 1954.
The central bank has called on non-Shariah compliant banks to close Islamic branches by year-end and stop taking deposits in those units immediately, said a person familiar with the announcement, Bloomberg said.
The timing of the move – if the report’s veracity is proved – is unfortunate, since Qatar has been controversially selected as the hosts for the 2022 World Cup soccer tournament, an event seen as boosting the Gulf state’s economy. The award of the games to Qatar, which has drawn criticism due to the jurisdiction's hot climate - the events are usually held in summer - has already prompted a flurry of investment commentary about the state's presumed benefits as a place to do business.
A number of Western banks, such as HSBC and Barclays, have set up Shariah-compliant banking operations around the world to garner business from Muslim clients.