As Islamic finance becomes a major part of the local and regional financial system, the Islamic financial services industry in the region is increasingly seeking more short-term funding sources and liquidity management tools.
Last week Islamic mortgage lender Amlak signed an $800 million 360-day Wakala facility with Emirates Islamic Bank. Wakala is an Islamic financial contract in which an investor places cash with a lender who then uses it to buy qualifying financial assets. The investor gets a commission and a share of the profits generated by the funds.
"The efficiency of the structure that we have agreed with Emirates Islamic Bank will increase Amlak's liquidity in the short term," said Arif Alharmi, CEO of Amlak Finance.
Full article at Gulf News.