The International Bank of Qatar is the first bank to sell its Islamic banking portfolio to a fully Shari'ah-compliant institution (Barwa Bank) to fulfill the requirements of the Central Bank of Qatar (CBQ). The sale of its Al Yusr retail banking portfolio and branches (along with the employees at the branches)--although not the private or corporate banking portfolios--provides hints that the CBQ will not ease up on its requirements for conventional banks to dispose of their Islamic portfolios.
However, still uncertain is whether IBQ believes that the it will ultimately be allowed to keep its Islamic private and corporate banking units, or whether Barwa Bank was only interested in the retail portion of the Islamic window. It is doubtful that the CBQ directive was only focused on retail banking because at issue was the potential for commingling of funds between Islamic and conventional banking segments. If that is the primary issue, then allowing private and corporate banking, but not retail banking would seem illogical.
The only reason that I can see for why the directive might (and there are no definitive signs yet that this is the case) only include retail banking is if the CBQ wanted to strengthen domestic Islamic retail bank. However, this is probably unlikely because it would allow conventional (including foreign) banks to retain the areas of banking that are probably more profitable, which does little to help the domestic Islamic banks that are expected to benefit from the directive.
As the end-of-year deadline for compliance with the CBQ directive approaches, there should be more clarity about the full scope of the directive, as well as if there is any exclusions from the requirement for conventional banks to divest their Islamic banking portfolios. At this point (as opposed to my initial assumptions), I think it is more likely that full divestment will be required, although the deadline may be extended (given the lack of announced developments so far). If there is any major change by the CBQ, it will probably be limited to allowing banks to hold onto their existing Islamic banking portfolios until they naturally decay, while prohibiting them from taking any new business.