Bahrain-based Elaf Bank has announced the closing of a two-year murabaha financing extended to the Shamil Bosphorus Modaraba.

This was sponsored by Shamil Bank and Turkish partners to undertake projects worth more than $450 million in Istanbul and on the Turkish coast.

"Elaf Bank is keen on working closely with Islamic banks in the region and develop strong relationships with the view of syndicating large transactions in the future, whether it be sukuk or equities and in order to raise the overall profile of this niche industry that is becoming mainstream in the region," Elaf Bank chief executive Dr Jamil El Jaroudi said.

"Shamil Bank of Bahrain is an institution with which we intend to develop such a relationship and we look forward to further join hands on interesting transactions," he added.

"Shamil's Bosphorus Moda-raba is a unique, high-return investment vehicle that provides our customer base in the region with the opportunity to capitalise on the growth of the Turkish economy.

"We are pleased to partner with Elaf Bank, Bahrain to further develop the Beylikduzu real estate project, a key investment within our Modaraba," said Shamil Bank chief executive officer Faisal Al Alwan said.

"Turkey is definitely one of the emerging markets which we have on our radar and through our shareholders a presence was established there a couple of years ago," Elaf Bank general manager for investment banking Ahmad Tayara.

"We are definitely entertaining more deals in that market. As far as this deal is concerned, tenure, returns, risk, and security coverage were all carefully assessed and found to be acceptable to close it successfully.

"We know Shamil and the Turkish partners and would pursue potential joint ventures in that market soon if profitable," he said.

"The murabaha was extended in connection with a single investment within the Modaraba, namely the Beylikduzu real estate development project," Shamil Bank head of Private Banking Abdul Hakim Khalil Al Mutawa.

"The use of proceeds would allow the Modareb and its Turkish partners to acquire an additional plot of land adjacent to the existing plot, straighten any shape irregularities that existed previously, and have full access to one additional road making the final plot a perfect rectangle surrounded by three roads one of which is a major highway in Istanbul, as well as enhancing its sale value.

"Overall, we are projecting a return of investment of close to 60 per cent for the Bosphorus Modaraba, based on a conservative mix of assets catering for different market niches, activities and geography," he said.-TradeArabia News Service