Tamweel eyes Turkey expansion
Posted by meb at January 31st, 2008
Dubai-based Islamic mortgage lender Tamweel said it plans to expand into India, Morocco and Turkey, and expects to turn a profit from Egyptian and Saudi operations next year.
“In Egypt and Saudi Arabia, it is all approved and we are just setting up,” Chief Executive Officer Adel al-Shirawi told Reuters in Davos. “We will start to earn there in 2009.”
To fund its rapid expansion, Al Shirawi said the firm aimed to raise capital by all means possible, including debt, issuing sukuk or Islamic bonds, and through the listing of its local units.
“We will keep a majority stake,” he said. “(We) will diversify risk through regionalization but will remain focused on mortgages.”
He also aims to securitize portions of the group’s mortgage book once it grows further, possibly as soon as 2009, he said.
“We’ve been doubling it every year so why should we stop?” he said. “If you more than double it, you’re going to get into a non-quality book.”
Tamweel recently sold $300 million in convertible Islamic bonds, or sukuk, which comply with Islam’s ban on interest and offer investors a share of profits from underlying assets instead.
Al Shirawi said the turmoil in Western markets had benefited his business, as falling U.S. interest rates widened the gap between the price at which it borrows and lends to home owners, improving the earnings power of Tamweel’s mortgage book.
Demand for mortgages is surging in the UAE, where Dubai kicked off the Gulf Arab real estate boom in 2002 by allowing foreigners to invest in property.
Source: Reuters
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