Qatar is accumulating shares in Credit Suisse Group and plans to spend as much as US$15 billion on European and US bank stocks over the next year, the Gulf state's prime minister said in an interview.
"We have a relation with Credit Suisse and we bought some of the stock from the market, actually, but I cannot say what percentage because still we are in the process," Sheikh Hamad bin Jasim bin Jaber al-Thani, who is also chief executive officer of the Qatar Investment Authority, said in an interview on Sunday in Doha.
Persian Gulf sovereign wealth funds (SWFs), whose coffers are swelling with near-record oil prices, and counterparts in Asia have been snapping up stakes in banks with balance sheets battered by US subprime mortgage losses.
Citigroup Inc. has received US$14.5 billion from investors, including the governments of Singapore and Kuwait, since the middle of December.
"Sovereign funds will keep scooping up more US finance stocks this year," said Walter Lin, the Shanghai-based chief representative of Morley Fund Management, Aviva Plc's fund-management company.
"They're more removed from Wall Street than other investors, and so have a more sanguine view of the subprime crisis," he said.
A spokeswoman for Credit Suisse in Hong Kong directed calls to the firm's Zurich headquarters, where they weren't immediately answered.
Last Tuesday, Credit Suisse said fourth-quarter profit fell 72 percent after writedowns of 1.3 billion Swiss francs (US$1.2 billion) on debt and leveraged loans. The stock has plunged 33 percent since an Oct. 10 peak.
Brady Dougan, chief executive officer of Switzerland's second-biggest bank, scaled back risky investments before the debt-market slump that forced UBS AG, Switzerland's biggest bank, to take a US$14 billion charge.
SWFs have recently made investments in Citigroup, Merrill Lynch & Co, Morgan Stanley and UBS. Wall Street banks have raised US$59 billion, mostly from investors in the Middle East and Asia. Citigroup alone was propped up last November by a US$7.5 billion investment from the Abu Dhabi Investment Authority, the world's richest sovereign fund, after losing almost half its market value.
China Investment Corp., which manages the nation's US$200 billion sovereign wealth fund, spent US$5 billion last year buying a 9.9 percent stake in Morgan Stanley. Singapore's Temasek Holdings Pte paid US$4.4 billion for a stake in Merrill Lynch.
The growing dependence of US banks on SWFs has fed calls in the US for greater scrutiny of the investments. Asked about these concerns, particularly those being aired in Washington, Sheikh Hamad said he was surprised by the resistance and that the idea is to help financial institutions.
"The sovereign fund is from friendly countries, especially this region," he said "They have no political ambitions. They are looking to invest their wealth for the people of these countries."
He was speaking in an interview with Bloomberg Television before attending the opening of the Brookings Doha Center, a project of the Saban Center for Middle East Policy based at the Brookings Institution in Washington.
Sheikh Hamad also announced Qatar is creating October 1 billion funds in Finland and Malaysia similar to the fund Qatar's Investment Authority announced in December that it was starting with Indonesia.
TYPHOON: The storm’s path indicates a high possibility of Krathon making landfall in Pingtung County, depending on when the storm turns north, the CWA said Typhoon Krathon is strengthening and is more likely to make landfall in Taiwan, the Central Weather Administration (CWA) said in a forecast released yesterday afternoon. As of 2pm yesterday, the CWA’s updated sea warning for Krathon showed that the storm was about 430km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point. It was moving in west-northwest at 9kph, with maximum sustained winds of 119kph and gusts of up to 155kph, CWA data showed. Krathon is expected to move further west before turning north tomorrow, CWA forecaster Wu Wan-hua (伍婉華) said. The CWA’s latest forecast and other countries’ projections of the storm’s path indicate a higher
SLOW-MOVING STORM: The typhoon has started moving north, but at a very slow pace, adding uncertainty to the extent of its impact on the nation Work and classes have been canceled across the nation today because of Typhoon Krathon, with residents in the south advised to brace for winds that could reach force 17 on the Beaufort scale as the Central Weather Administration (CWA) forecast that the storm would make landfall there. Force 17 wind with speeds of 56.1 to 61.2 meters per second, the highest number on the Beaufort scale, rarely occur and could cause serious damage. Krathon could be the second typhoon to land in southwestern Taiwan, following typhoon Elsie in 1996, CWA records showed. As of 8pm yesterday, the typhoon’s center was 180km
TYPHOON DAY: Taitung, Pingtung, Tainan, Chiayi, Hualien and Kaohsiung canceled work and classes today. The storm is to start moving north this afternoon The outer rim of Typhoon Krathon made landfall in Taitung County and the Hengchun Peninsula (恆春半島) at about noon yesterday, the Central Weather Administration (CWA) said, adding that the eye of the storm was expected to hit land tomorrow. The CWA at 2:30pm yesterday issued a land alert for Krathon after issuing a sea alert on Sunday. It also expanded the scope of the sea alert to include waters north of Taiwan Strait, in addition to its south, from the Bashi Channel to the Pratas Islands (Dongsha Islands, 東沙群島). As of 6pm yesterday, the typhoon’s center was 160km south of
STILL DANGEROUS: The typhoon was expected to weaken, but it would still maintain its structure, with high winds and heavy rain, the weather agency said One person had died amid heavy winds and rain brought by Typhoon Krathon, while 70 were injured and two people were unaccounted for, the Central Emergency Operation Center said yesterday, while work and classes have been canceled nationwide today for the second day. The Hualien County Fire Department said that a man in his 70s had fallen to his death at about 11am on Tuesday while trimming a tree at his home in Shoufeng Township (壽豐). Meanwhile, the Yunlin County Fire Department received a report of a person falling into the sea at about 1pm on Tuesday, but had to suspend search-and-rescue
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