Qatar Central Bank will not “interfere” in the negotiations between local banks for their possible merger, said HE the QCB Governor Sheikh Abdulla bin Saoud.

“Once the proposal is submitted to QCB, we will examine its merits and demerits. In any chance, the Central Bank will not interfere in their negotiations; banks have to sign a MoU based on our corporate governance stan¬dards, and have to come out with a feasible proposal. The proposal also have to be subjected to detailed legal and financial due diligence,” Sheikh Abdulla said on Sunday.

He said, “Bank mergers have their own advantages and disadvantages. In general, merger talks are motivated when the banks involved expect that the value of the combined entity will improve after the merger.

“When the operating environment becomes tight for a large number of smaller banks, the shareholders initiate the talks to reap the maximum benefit through reducing corporate risk and stabilising earnings.”