Islamic mortgages an important factor in Gulf capital markets

Fri, 17 Feb 2012
Islamic mortgages could be an important factor in Gulf capital markets at present, as these areas have seen a marked rise in sukuk sales over the past few months.

The Financial Times reports that this trend is due to issuers increasingly turning to Islamic finance in their search for capital.

According to the newspaper, companies are using this approach in order to generate funds - and they are able to do so after a restrictive global credit environment in 2011 limited issuance from the region.

In addition, Islamic banks are viewed as highly liquid financial institutions, with the capacity to re-invest excess funds that have been left over due to low loan-to-deposit ratios.

As a result, more bodies in the Gulf capital markets may find greater emphasis is placed on sharia-compliant products such as Islamic mortgages in the near future.

The news comes after Arab News recently reported that London is vying with a number of other financial hubs - such as Dubai, Kuala Lumpur, Bahrain and Saudi Arabia - to become the centre of the Islamic finance world.
Salaam-u-Allaikum
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