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Qatar Airways has signed an agreement with Standard Chartered in Doha for a US$736mn interest rate swap transaction, which provides an interest rate hedging facility to Qatar Airways to fix its long-term borrowing costs for a total of 12 aircraft. The tenor extends up to 12 years and is aimed at providing Qatar Airways with protection against possible interest rate rises.

“This landmark interest rate swap is a clear affirmation of Standard Chartered Bank’s commitment to the long-term strategic plans laid out by the government for the continuous economic growth of the country,” states Arif Mansoor, chief executive officer at Standard Chartered Bank Qatar . The deal follows the recent long-term financing of two Airbus A320 aircraft where Standard Chartered also participated as one of the lenders.

Qatar Airways recently signed an agreement with Airbus for an order of 34 aircraft in a US$5.1bn deal that will help the airline in its goal to increase its fleet to 56 by 2008. It currently operates 24 new Airbus aircraft, including A330-200s, A300-600s, A320-200s and A319 corporate jets, which will increase to 29 by the end of this year. It is one of the launch customers for the Airbus A380 “super jumbo” in 2009.

Standard Chartered is the first bank incorporated in the State of Qatar.