Shareholders of Commercial Bank of Qatar (CBQ) have approved the issue of up to $1 billion in capital-raising instruments, the bank said on Thursday.

The annual shareholders' meeting of the Gulf Arab state's second-largest lender by assets gave its backing for the move in accordance with Basel capital requirements, it said in a statement.

It is the latest Gulf bank to weigh raising funds in order to fund growth, diversify sources of funding and prepare for new Basel III banking rules, which will oblige banks to set aside more capital from 2019.

Earlier this month, Doha Bank said it had received shareholder approval to issue bonds worth up to QR2 billion ($549 million), as well as assent for the issuance of regular bonds.

Dubai Islamic Bank sold $1 billion of Tier 1 Islamic bonds in January at 6.75 per cent, while Qatar Islamic Bank and Oman's Bank Dhofar are among those to have announced plans to issue Tier 1 bonds since the start of this year.

CBQ's total capital ratio was 15.22 per cent at the end of December 2014, according to its latest financial statement. Qatar's central bank sets a minimum prescribed level of 12.5 per cent. The bank said it planned to issue Tier 1 or Tier 2 instruments, or both. Tier 1 refers to a bank's core capital, while Tier 2 is supplementary capital.

CBQ shareholders gave their assent for the bank to raise the capital locally and globally and to approve the final amount and currency. Approval was also required from the central bank and other government authorities, according to the statement. - Reuters