Ajman Bank shelves plan for realty fund

Ajman Bank has cancelled plans to launch a real estate fund, citing adverse market conditions, Emirates 24/7 can reveal.

“Our real estate fund was cancelled due to recent market conditions. Of course, the fund was never launched,” the bank said in an emailed statement.

In 2010, the Shariah-compliant bank had said it plans to launch a property fund, but had then refrained from stating the size or time for the fund’s launch.

The Dubai Financial Market-listed bank is the only entity till date to offer end user finance under the Tayseer - the guaranteed funding - initiative of the Dubai Land Department.

In December

Mohamed Amiri, Deputy CEO, Ajman Bank, had told this website that they had agreed with the Land Department to initially start end-user financing and had set aside Dh4 million to fund properties under the programme.

“Home financing is a core part of our bank’s business. The agreement will have a positive impact on the UAE’s overall economic climate by increasing liquidity and boosting the Dubai real estate sector,” he had said.

In the past two years, a number of real estate and fund management companies had announced plans to launch realty funds. However, most of them till date haven’t been successful in launching their funds.

Among the many was Deyaar Development, which announced in 2009, plans to launch a distressed fund worth Dh500 million. However, the fund failed to take off as international investors pulled out.

Later, Gowealthy Capital Limited, an investment company registered with Dubai International Financial Centre, said it was working on facilitating launch of four funds worth $435 million (Dh1.6 billion) in the second and third quarter of 2009. No details of the fund were released.

Ajman Bank has reported a net profit of Dh4 million for 2010 compared to Dh1.1 million in 2009 due to strong growth in income from its core activities.

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