Amlak, Tamweel to merge into real estate bank - WAM
DUBAI, Nov 23 (Reuters) - Two of Dubai's biggest property finance companies, Amlak AMLK.DU and Tamweel TAML.DU, got the government green light to merge into a single bank in a move to build confidence as the emirate's property woes mount.
The merger of the Islamic-compliant lenders will take place under government supervision to ensure fair valuation and to protect shareholders, state news agency WAM reported. The combined market value of the firms is 2.5 billion dirhams ($680.6 million).
Amlak, whose shares have fallen 80 percent this year, last week said it had stopped issuing new mortgages while Tamweel, whose shares have fallen 85 percent, said it continued to operate despite deteriorating conditions in the property markets.
Lenders and developers in the United Arab Emirates have been battered by the credit crisis after market financing evaporated, property values plunged and buyers fled a market where land values have ballooned during a five-year boom.
The companies will be combined as the UAE Real Estate Bank to create the largest real estate finance institution in the country, WAM said.
Amlak Finance is already the largest publicly held Islamic finance company in the UAE. The two companies first said they intended to merge in October.
(Reporting by Thomas Atkins; Editing by Kim Coghill)
