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Tamweel chair sees Q3 results similar to Q2

Dubai, October 4, 2010

Troubled Islamic mortgage firm Tamweel expects to post third quarter earnings similar to its first and second quarter results as it prepares to start issuing fresh mortgages, the company's chairman said on Monday.

Speaking at the property conference Cityscape Global in Dubai, Sheikh Khaled bin Zayed al-Nehayan said the company had taken the bulk of its provisions in 2009.

"We expect Q3 to be similar to Q1 and Q2," he said. "We have taken enough provisions so now we can translate our revenues into some profits."

Tamweel reported a second-quarter net profit of Dh5.4 million ($1.5 million) and a loss of Dh3.13 million dirhams in the first quarter of 2010.

Al-Nehayan also said a long-planned merger between troubled Islamic mortgage firm Tamweel and Islamic lender Amlak has likely been scrapped, following Dubai Islamic Bank's stake increase in late September.

Dubai Islamic Bank raised its stake in Tamweel  to 57.33 per cent, effectively rendering Tamweel a subsidiary of DIB, the emirate's third-largest bank by market value.

Arabic-language daily Al Ittihad, citing an unnamed source, said on Sunday that Emirates Islamic Bank, an affiliate of Emirates NBD , was in early talks to acquire Dubai Bank and Amlak.

The United Arab Emirates government said in November 2008 it aimed to merge Amlak and Tamweel and has been working on a plan to restructure them. Shares in the two firms have not traded since.

Al-Nehayan said a resumption in trading of the company's shares will be a decision for the authorities but added to Arabic television network al-Arabiya, that the board was planning to ask for shares to resume trading.

He said that Tamweel will likely start issuing fresh mortgages in two months, once DIB lays outs plan for the company in detail.

In December, the Dubai government said it formed a judicial committee to protect creditors and companies related to Amlak and Tamweel, in what was seen as a bid to boost transparency.

House prices in Dubai have fallen some 60 per cent since their peaks in 2008, billions of dollars worth of projects were put on hold or cancelled, and lending dried up. – Reuters




Tags: Amlak | Tamweel | Dubai Islamic | Second quarter |

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