Monday, Feb 01, 2010
DUBAI ( Dow Jones)-Dubai-based Tamweel pJSC (TAMWEEL.DFM) is studying options if its merger with Amlak Finance pJSC (AMLAK.DFM) fails, the mortgage lender's chairman told Al Arabiya Television Monday.
But Tamweel prefers a government involvement in the new entity either by buying shares or giving loans, Sheikh Khaled Bin Zayed Al Nahyan told the Dubai-based Al Arabiya. try{document.write(_banner_zone('zone9339')); }catch(e){}
The U.A.E. government in November 2008 announced plans to merge Amlak and Tamweel --once the U.A.E's two biggest mortgage lenders--and shares of both companies, which are listed on the Dubai Financial Market, have been suspended since merger discussions were announced.
Amlak and Tamweel were hit by the fallout from the financial crisis which blocked the mortgage lender's access to new funding as Dubai grappled with a property slump that led to about a 50% decline in real estate prices in 2009.
Last month, the emirate's ruler Sheik Mohammed bin Rashid Al Maktoum issued a decree creating a special judicial committee to deal with any disputes pertaining to the two mortgage lenders, and their creditors to safeguard their rights.
Tamweel made a net profit of 10 million U.A.E. dirhams ($2.72 million) during the third quarter of 2009 after taking AED53 million in impairment provisions.
The firm has allocated AED450 million in provisions and will keep the same pace of provisioning for the coming period until there are signs of improvement, Tamweel 's chairman told Al Arabiya channel.
The company resulting from the planned merger of Tamweel and Amlak will likely receive a banking license in early 2010 once the union is completed, Tamweel 's chairman told Dow Jones in November.
-By Summer Said, Dow Jones Newswires; +97150 2951855; summer.said@dowjones.com
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(END) Dow Jones Newswires
01-02-10 0858GMT
