Amlak to sell $250m sukuk by fall

UAE's Amlak Finance plans to sell $250 million (AED918.2 million) worth of sukuk - Islamic bonds - by September in a bid to secure its long-term funding and finance expansion, its chief executive said yesterday. The Islamic mortgage provider is set to go to market "within the next two months," Arif Al Harmi told Bloomberg TV in an interview.According to an Emirates Today report, Amlak owns $1.2 billion (AED4.5 billion) worth of Islamic mortgages and will ‘definitely' use them as assets to back more bonds.

The company is pursuing expansion in the Middle East after posting its second-smallest profit in the first quarter in two years. Net income in the three months to March 31 plunged 35.4%.

Last month Amlak announced that it has won approval to start operations in Saudi Arabia as it seeks new sources of revenue overseas. The company joined local partners to create a company with share capital of one billion riyals ($266.7 million) with a 99-year licence.In a move to increase its liquidity, the mortgage provider last week signed a deal for a $217.9 million (AED800 million) loan facility with Emirates Islamic Bank - a unit of Emirates Bank Group - in the form of a one-year wakala facility.Wakala is an Islamic financial contract whereby an investor places cash with a lender which then uses it to buy qualifying financial assets. In return the investor gets a commission and a share of the profits generated by the funds. Source