By Daliah Merzaban
Dubai-based mortgage lenders to resume business as separate entities before merger.
Dubai-based Amlak and Tamweel will resume mortgage lending within weeks as separate entities before moving ahead with a likely merger, Dubai's finance chief said in remarks carried on Wednesday.
The fate of a merger of the two Islamic home finance companies has been under review by a government committee this year since the UAE announced in November it would merge the entities and halted trading in their shares.
"As far as I know, their intention is to reactivate the two companies and then work on the merger," said Nasser Al Sheikh, director-general of Dubai's Department of Finance, according to daily Emirates Business.
"The road is paved to the merger and we have a common agreement between the two boards and the two management teams, and at the end it will be the shareholders' decision."
Sheikh added the two firms could resume lending "within weeks" and that a ministerial committee was discussing the possibility of extending or restructuring the firms' debt obligations. (Reuters)
If these companies actually start lending again (meaning the requirements to qualify for a mortgage are not so unrealistic that no one qualifies) this could mark the bottom of the real estate downturn in Dubai. Does anyone know if the shares of Amlak & Tamweel will start trading again on the DFM once these companies start lending again, or will both companies shares still be frozen until the merger plans are finalized?
This will activate the local real estate market again, and other banks will start now offering better terms for lending. Its very simple, when the biggest lenders (Amlak and Tamweel) step up again and end the recession it should have a very good impact.
Why did amlak & tamweel stop lending under the pretext of merger. This has failed to set the property market direction.
Lending again could mean nothing if both regulatory agencies require a hefty down payment and a long tedious process.... Lending is one thing and approval is another thing... might as well call it a nightmare.... During the good old days Tamweel required 25% down payment on a secondary market property... wonder what the dp rate would be now... Can't understand why both companies have not been allowed to trade since Nov. 08. In the real world companies keep trading until the day of the merger and once completed... a re-assessment... At any rate good luck too all Lenders....