Islamic mortgage firm Amlak takes hit from lack of lending

Wed, 17 Aug 2011
Islamic mortgage provider Amlak Finance has posted a loss in its second quarter figures, which it claims is due to an increase in the availability of cut-price deals for existing customers.

The Dubai-based Islamic mortgage lender also blamed the drop in income on two years of limited new custom.

A government embargo on Amlak shares - a common restriction among lenders in the emirate - was imposed in 2008 following the property market dive and credit crunch.

This meant that the provider, which is now being reorganised by the government, was unable to take on new business and thus suffered financially.

The government had hoped to merge Amlak with fellow Islamic mortgage provider Tamweel, but these plans have now been scrapped.

Tamweel has begun trading again after the Dubai Islamic Bank increased its stake and produced additional funds to help the lender provide Islamic mortgages once more.

Gulfnews.com recently reported that Tamweel has entered the debt market for the first time in three years in response to the demand for Islamic bonds.
Salaam-u-Allaikum
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