Amlak Finance seeks extension on US$2 billion debt after protracted talks with creditors (By IFN)

Amlak Finance seeks extension on US$2 billion debt after protracted talks with creditors

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UAE: Sources close to Shariah compliant mortgage provider Amlak Finance have said that the company has proposed a 15-year extension on the maturity of its US$2 billion debt and a discount of 30% to US$1.4 billion to its creditor committee; which is headed up by Emirates NBD and comprises of Abu Dhabi Islamic Bank, Dubai Islamic Bank, the Department of Finance of Dubai, Standard Chartered and the National Bonds Corporation. The company, which ceased trading in November 2008 following the Dubai property crash, has struggled to remain afloat and is currently mired in debt estimated at US$10 billion. According to Bloomberg, the company aims to refocus its strategy on mortgage lending and move away from property development. Talks on Amlak’s restructuring began in the first week of January this year, when the company’s creditors filed claims against it due to failure to repay its debt. Dubai’s minister of economy, Sultan Al Mansoori, has said that the case was “one of the most complicated issues” when it surfaced at the time. Emaar Properties, which currently owns a 45% stake in Amlak, has said that it will not decrease its investments in the mortgage company and is confident that the company’s performance — which has exhibited growth since 2010 — will continue to improve as the Dubai real estate and property market show signs of revival.