* Wants to benefit from Qatar growth plans
* Sees prospects in contracty financing, loans
* To increase share capital by 50 pct
* Some proceeds may go for acquisitions-analyst
(Recasts, adds CEO, analyst's comments)
DOHA, Sept 19 (Reuters) - Doha Bank, Qatar's
fifth-largest lender by market value, is planning a share issue
which could raise a further $1.6 million to ride an economic
boom in the gas-rich Gulf state.
The bank, which raised $500 million from a bond sale in
March, said on Wednesday in a statement to the Qatar bourse that
it planned to increase its share capital by 50 percent in the
first quarter of 2013.
The bank has a market value of around $3.2 billion
"We want to set a clear expansion model in terms of growth,
commensurate with the region and the local economy ... aligning
ourselves with Qatar's development strategy," Chief Executive R.
Seetharaman told reporters on the sidelines of a conference.
He said growth projects would "create opportunities for
contract finance, trade finance and corporate and commercial
lending. So we're getting ready for the boom phase."
"Now we are paving the way for an equity issue."
Qatar banks are expected to benefit from the country's
breakneck expansion plans and many have already tapped capital
markets this year.
Jaap Meijer, a director for equity research at Dubai-based
Arqaam Capital Ltd., which has a "hold" rating on the stock,
said the bank's capital level was "very tight".
He said some of the proceeds will be used to boost capital
while the remainder would go for mergers and acquisitions
outside Qatar.
Meijer expects the bank to raise between 4.1 billion Qatari
riyals to 5.8 billion riyals, depending on whether the shares
are sold at par or at a discount.
The bank said details of the capital raising would be
disclosed after necessary studies and approvals were in place.
Doha Bank shares rose 0.4 percent on the Qatar bourse
Wednesday. They have fallen 12.6 percent year-to-date, according
to Thomson Reuters data.
Meijer said he expected the capital increase to boost the
bank's core tier-one capital to 19.2 percent.
Qatar National Bank (QNB), the largest lender in
the country, has been on an acquisition spree recently snapping
up stakes in regional lenders.
It is also in talks with France's Societe Generale
to buy its controlling stake in Egyptian unit National Societe
Generale Bank.
QNB raised $3.5 billion from a rights issue last year.
A senior Standard & Poor's executive said in July that
Qatari lenders should rely less on deposits and issue more debt
and Islamic bonds to raise capital to fuel the country's growth.
($1 = 3.6412 Qatar rials)
(Additional reporting by Rachna Uppal; Writing by Dinesh Nair;
Editing by David Cowell)