By Ed Attwood
UAE Islamic mortgage firm posts $7.1m in profits for Q1, set to resume trading on May 10
Islamic mortgage provider Tamweel posted a jump in first quarter net profits to $7.4m, more than the company made in the whole of 2010.
The company, which is majority owned by Dubai Islamic Bank, also confirmed it would resume trading on May 10 after a two-year hiatus.
Tamweel's quarterly results built on the $7.1m profits recorded in 2010, a swing away from the company’s $14.8m loss posted during 2009.
First-quarter profits amounted to a little over four times the results posted in the same quarter last year, the company said in a statement to Dubai bourse on Thursday.
The firm's performance was helped by lower provisions in comparison to the same time last year. The firm put aside $13.8m in impairments in the first quarter last year, and saw that figure drop by 68 percent to $4.4m in 2011.
"Since the turn of the year, we have witnessed clear signs of increased economic stability, and this is evidenced by our strong first quarter financial performance," said acting CEO Varun Sood. "We have set ourselves a number of ambitious goals and we aim to demonstrate this through our performance in the near future."
Tamweel effectively became a subsidiary of DIB in September, when the lender raised its stake from 21 to 57 percent.
Tamweel, which stopped trading its shares in November 2008, said DIB's stake buy provided "significant liquidity and support" for the company to return to trading.
The company in January launched a promotional mortgage offer at 4.99 percent per annum on up to 80 percent of the value of completed properties in Dubai and Abu Dhabi.
It said it hoped to capitalise on increasing signs of confidence in the UAE’s property market.
The firm applied to the Securities and Commodities Authority in the UAE to resume trading its shares after a two-year break on 20 April.