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Wed 23 Apr 2008 12:36 PM

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Tamweel profit surges on UAE lending

Dubai-based Islamic mortgage company posts second-biggest quarter ever.

Dubai Islamic mortgage company Tamweel posted its second-biggest profit ever in the first quarter, paced by lending in its United Arab Emirates home market.

Net income in the three months to March 31 more than tripled to 176.3 million dirhams ($48.01 million), compared with 50.47 million dirhams in the year-earlier period, the company said in a statement.

Income from financing and investments more that doubled to 139.51 million dirhams as the firm booked 2.54 billion dirhams in financed properties in the first quarter, a record, it said.

"The property market in the UAE and the wider region has surged rapidly," Wasim Saifi, Tamweel's chief executive, said in the statement.

The earnings exceeded a forecast of 153 million dirhams from EFG-Hermes in a Reuters survey last month.

Rival Amlak Finance also this month posted its second-biggest profit ever as income surged more than five-fold, driven by mortgage sales and property investments.

Saifi said last week full year-profit at Tamweel could rise as much as 80%, driven by its lending business.

The company said in February it expects to start business in Saudi Arabia and Egypt this year as part of an international expansion programme to reduce reliance on the UAE.

Tamweel, which depends on Dubai for almost all its revenue, is in the "advanced stages" of setting up in Saudi Arabia, the largest Arab economy, in a joint venture it will control, Feras Kalthoum, head of investments, told the Reuters Islamic Finance Summit in Dubai in February.

In Egypt, the most-populous Arab nation, Tamweel will own the entire operation.

"The aim is that 20 to 30 percent will, in the next two to three years, come from the international market," Kalthoum had said of the company's revenue.

Next year, Tamweel may open in Turkey, one of six countries it has targeted for expansion, including Morocco, India and Pakistan.

Shares of Tamweel closed up 2.45% on Tuesday, extending gains this year to more than 21%, compared with a decline in Dubai's main stock index.

In contrast, shares of Amlak are down about 3%. (Reuters)

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