New bond programme for Islamic mortgage lender

Mon, 12 Dec 2011
A new bond programme has been set up by an Islamic mortgage lender significantly affected by the global financial crisis.

Tamweel has established the $1 billion (£643 million) arrangement after also being hit by a property bust in the Middle East, the Gulf Daily News reports.

Investor meetings are to be completed by the company with its parent firm Dubai Islamic Bank (DIB), which may lead to the latter guaranteeing an Islamic bond, otherwise known as a sukuk.

Alongside DIB, Standard Chartered and Citi are also acting as the dealers for the initiative.

The news provider noted a lack of a guarantee from DIB would have meant a high premium being demanded on Tamweel bonds by investors, as the Islamic mortgage provider has seen its shares struggle since the collapse of the real estate industry in Dubai in 2008.

Last month, the Gulf Daily News reported that Oliver Agha, partner at Agha and Company/Agha and Shamsi, claimed the Middle East is home to some of the leading Islamic mortgage financiers on the planet and needs to show other areas how such dealings can be successfully carried out.
Salaam-u-Allaikum
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