UAE's mortgage market to soar

Dubai: The mortgage market in the country will exceed Dh20 billion by the end of this year, the head of housing finance firm Tamweel said.
"The mortgage market in the UAE is set for greater growth this year, and we believe there is room for more players," Tamweel chief executive officer Adel Al Shirawi told Gulf News.
Tamweel and Amlak dominate the UAE housing finance market, with the former holding a 25 per cent share and the latter leading the market with 35 per cent share, according to investment bank EFG-Hermes.
Commercial banks that offer housing finance account for the rest.
Al Shirawi insisted Tamweel has a larger share in the market. "We think we have bigger share in the market off balance sheet," he said.
At the end of 2006, total outstanding credit in the housing market was Dh17 billion, according to EFG housing analyst Azza Al Arabi.
This year the market size will reach Dh20 billion, Al Shirawi said. "We expect it will be Dh17 billion in Dubai and Dh3 billion in Abu Dhabi," he said.
Both Tamweel and Amlak are planning to issue sukuks to fund their expansion amid the continuing UAE property boom.
The UAE Central Bank reportedly rejected an application for full banking operations from Amlak, which now plans to sell $300 million worth of sukuks to finance its operations.
Both Amlak and Tam-weel are Sharia-compliant finance companies and a banking licence would allow them to hold retail customer deposits.
Al Shirawi said he was hopeful the Central Bank would approve his company's application for a full banking licence.
"Today we have a big balance sheet and we are good enough to be considered. We are confident that we will be a good candidate to get the licence," he said.
Tamweel will make an announcement on its planned sukuk after the company's scheduled extraordinary general meeting (EGM) on April 7. The EGM, scheduled to take place yesterday, was postponed due to a lack of quorum.
However, the annual general meeting (AGM) took place as planned and shareholders approved a cash dividend of 20 per cent of the company's share capital, amounting to Dh200 million.
Shaikh Khalid Bin Zayed Bin Saqr Al Nahyan, chairman of Tamweel, said the company's growth "has come in parallel with the ongoing economic development and diversification of the UAE."
Tamweel reported in January a net profit of Dh851.8 million for 2006, an increase of 1,918 per cent compared to Dh42.2 million during 2005.
The core business profit rose to Dh153 million, an increase of 315 per cent.
Earnings per share rose to Dh1.11 up from Dh0.12.