Islamic mortgage lender posts AED53.9m ($14.67m) net loss for quarter versus AED3.1m loss in year earlier period
Troubled Islamic mortgage lender Amlak said on Thursday net loss for the first-quarter soared, hurt by higher provisions and a sharp drop in revenues.
The Dubai lender made a net loss of AED53.9m ($14.67m) for the quarter, compared with a loss of AED3.1m during the same period in 2010, it said in a statement to the Dubai bourse.
Revenue from financing and investing activity fell by seventeen percent during the quarter, the company said, due to no new business over the past two years, continuing into 2011.
The company took impairments on Islamic financing and investment assets of AED58.4m in the quarter.
Amlak's total assets in the quarter stood at AED13bn, falling from AED13.9bn in the year-before period, due to overall effect of decreasing mortgage portfolio.
The UAE government suspended trading of Amlak along with rival Tamweel in November 2008 amid a liquidity crunch and announced intentions to merge the two Islamic lenders.
Tamweel resumed trading earlier this week.
Its such a shame. Amlak was the only Dubai finance institution that didn't have any of its chiefs jailed for corruption. However, their business practices have let them down badly. Even in 2009, during the peak of the recession, they released millions of dirhams in premiums to sellers - money that they had committed to sellers during the good times but did not re-negotiate during the bad times thereby wasting millions.