10/05/2017 08:08 AST
Doha Bank will soon file application for its proposed exchange traded funds (ETF), which carries a fee or expense ratio of 0.5%, one of the lowest in emerging markets offerings.
"The bank, as founder, is in the final phase for filing its application for listing approval for the proposed launch of the QE Index ETF (QETF)," Doha Bank group chief executive R Seetharaman told the annual Investment Forum in New York organised by the Qatar Stock Exchange (QSE) and HSBC.
He said Doha Bank has been working closely with the listing committee and the QSE and local regulators in driving the new listing towards growing the investment platform in Qatar via new offerings.
Highlighting that the QETF would invest and replicate the Qatar Index's largest 20 companies in terms of market capitalisation and liquid listings "the crown jewels of Q Inc"; he said the fund would replicate the index in performance, net of fees.
"The fees or 'total expense ratio' to be 0.50%; one of the lowest in emerging markets offerings," he said, adding the fund would pay an annual dividend, net of fees, similar to the index; which currently carries a yield of 3.80%.
The Doha Bank QETF has Amwal and Group Securities as fund manager and liquidity provider respectively.
Seetharaman said the offering would enjoy easy access, as the investor needs only an investor number and broker and the ETF would easily be traded in the secondary market like other current listings.
"The fund enjoys full support from local government and regulators and currently the bank is raising seed capital to be invested along with the bank pre-listing," he said.
Stressing that the QSE aims to provide more products this year to encourage investments from global investors, Rashid bin Ali al-Mansoori, QSE chief executive, said the ETF is part of this initiative of the bourse. "This would result in increase in inflows to Qatar economy, both from the region and from globe and thereby promote sustainability," he added.
Seetharaman had earlier said Qatar has the potential for $10bn to $15bn overseas funds inflow since its upgrade into emerging market.
On the macroeconomic prospects of Qatar, he said the domestic economy is expected to grow by 3.4% this year and the country continues to follow its non-hydrocarbon diversification model and prudent fiscal management amidst low oil prices.
Finding that Qatar's 2017 budget has allocated 44% of total expenditure to key sectors such as health, education and infrastructure; Seetharaman said "there is a clear focus on health, education and infrastructure development".
In the infrastructure space, Qatar is currently witnessing mega infrastructure projects culminating towards the FIFA World Cup in 2022, he said, adding Qatar's diversification has thereby contributed to sustainable development.
The Qatari government is also taking steps to increase non-oil revenues, focusing on indirect taxes and levies, according to him.
Gulfnews
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