Masraf Al Rayan, Barwa Bank and International Bank of Qatar (IBQ) have called off their proposed three-way merger that otherwise would have created the second-largest bank in Qatar with total assets of QR173bn and a market share of around 14%, reported Gulf Times.

Announcing that the negotiations on the proposed merger between the three banks have now ended, the banks said they ‘could not reach an agreement to complete the transaction.’

Accordingly, the three banks shall continue their business as usual in line with their individual business plans, a communiqué from the Qatar Stock Exchange said. However, it did not specify the reasons.

Masraf Al Rayan is a listed entity, while Barwa Bank and IBQ are not listed. At present, there are 18 banks in Qatar with QNB being the largest with a market share of more than 40% of domestic assets.

The proposed merger would have created the largest Islamic bank and second largest bank in Qatar, and would have resulted in a more balanced competitive environment in Qatar's banking system, Moody's, an international credit rating agency, had said in a report.

Last year, a committee, approved by the three collective boards of directors of the said banks, had been established to oversee the three-way merger.

In 2011, Al Khaliji and IBQ had entered into merger talks, which however did not proceed further.