Harrods’ Qatari owners will buy the luxury store’s private banking arm, British media reported Monday.
The Financial Services Authority in London gave Qatar Holding the green light to purchase the controlling shares in the bank held by a trust, The Daily Mail said.
“A new board has been appointed to support this exciting development,” a spokeswoman for the bank said, adding that she was “delighted” with FSA’s decision.
Sources told Al Arabiya Wednesday that Qatar considered acquiring seven major stakes in European investment banks but they didn’t disclose names.
Europe hit by financial crisis is an attractive place for Qatar who is seeking to widen its investment portfolio to diversify sources of income away from gas and fuel sectors.
In 2011, Harrods bank reported some $2.7 million in losses due to one bad loan.
“The loss has been significantly increased this year as the result of the need for a large provision of £800,000 ($1,284,633) against an impaired loan,” the paper added.
Qatar Holding also has expansion plans for the troubled bank.
“Overheads have increased as the bank begins to make an investment in IT systems and people development to allow for future expansion,” the British newspaper added.
Qatar Holding is an indirect subsidiary of Qatar Investment Authority, the Gulf state’s sovereign wealth fund. In 2010, it bought London’s Harrods for $2.2 billion and financed 95 percent of the British capital’s Shard Tower, Europe’s highest skyscraper.