* Qatar c. bank probing market manipulation during Gulfstandoff
* Qatar's top bank helping central bank with probe
* QNB says has repaid cash injection
By Dmitry Zhdannikov and ghaida ghantous
DOHA, April 4 (Reuters) - Qatar's top bank QNB ishelping the country's authorities with data and expertise toprobe if Qatar's neighbours manipulated its markets, includingcredit default swaps (CDS), during a political standoff lastyear, its CEO told Reuters.
Qatar's central bank said in December it had launched alegal investigation into attempts by countries opposed to it toharm the Qatari economy by manipulating the currency, securitiesand derivatives markets.
Qatar National Bank (QNB) Chief Executive Ali Ahmedal-Kuwari said in an interview there had been unusual moves inQatari CDS late last year.
"The behaviour was abnormal ... the way it was moving veryfast, this is not normal behaviour. The dust around the crisissettled after two months, but the CDS continued to go up for noreason," he said, estimating the Qatari CDS market at $21billion.
Al-Kuwari said QNB was cooperating with the central bank inits investigation and had been "supplying them with anyinformation or data they asked us to supply them with."
QNB, the Middle East's largest lender by assets, is 50percent owned by the Qatar Investment Authority, Qatar'ssovereign wealth fund.
Saudi Arabia, the United Arab Emirates, Bahrain and Egyptimposed an economic boycott on Qatar last June, accusing it ofbacking terrorism, which it denies. The boycott led to thewithdrawal of billions of dollars of deposits from Qatari banks.
Last month, Qatar's central bank asked U.S. regulators toinvestigate the U.S. unit of the largest bank in the United ArabEmirates, accusing it of "bogus" foreign exchange deals designedto harm its economy as part of a blockade by Gulf neighbors.
First Abu Dhabi Bank, parent of the U.S.subsidiary, NBAD Americas, denied it had tried to manipulate theQatari riyal.
The request for a U.S. investigation deepened the diplomaticcrisis between Qatar, a major gas exporter, and its Gulfneighbours.
Asked if there was concern about further attempts tomanipulate Qatar's economy, al-Kuwari said: "This is a majoroffence. People will have to think about the consequences. Andespecially now with the legal case on the table, I assume peoplewill think twice before going further into these actions."
Al-Kuwari said that despite a substantial withdrawal ofdeposits at the start of the Gulf crisis in the middle of lastyear, deposits at QNB grew 13 percent for the whole of 2017.
He said the trend will likely be sustained in the firstquarter across the entire Qatari banking sector thanks to higheroil and gas prices and renewed confidence in the economy.
Al-Kuwari said QNB had repaid a cash injection it receivedfrom Qatar's central bank at the peak of the crisis last year.
He did not give the amount but said it represented a fairshare among Qatari banks. He said the overall injection amountedto around $20 billion for the whole of the banking sector, halfof which is controlled by QNB.
Qatar was able to beat the crisis partly thanks to a bigcash buffer of $350 billion in central bank reserves and assetsat the Qatar Investment Authority, which include stakes in majorcompanies including Glencore and Volkswagen.(Editing by Adrian Croft)
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