The newest Islamic bank being established in the UAE, Emirates Islamic Bank (EIB), is arranging close to Dh400mn worth of murabaha financing for two customers, and the official operations of the bank are expected to commence by the last quarter of this year.

Abdullah Abdul Karim Showaiter, head of investments, says EIB will undertake syndicated deals in Turkey with HSBC Amanah Finance, and in Singapore with the Islamic financing window of Standard Chartered Bank, UAE.

He says the Turkey deal is almost complete whereas documentation for the Singapore financing deal is being finalised.

Stating that the demand for Islamic finance is fast increasing in the region, Showaiter claims several other deals are also in the pipeline and will be concluded in due course.

The UAE has been witnessing higher demand for Islamic finance and that should be the reason why three Islamic financial institutions took birth in the UAE during the last two years.

While National Bank of Sharjah (NBS) was converted into an Islamic bank two years ago, Amlak Finance, the subsidiary finance arm of Emaar Properties, decided to become an Islamic entity following a public issue a couple of months ago.

According to Ibrahim Fayez Al Shamsi, the chief executive of EIB, there is no dearth of Islamic products that can be offered by Islamic financial institutions.

“Perhaps Islamic financial products available in the market would be in excess of the products being offered by the conventional institutions,” he adds.

For Emirates Bank Group (EBG) which owns EIB, the move is part of a diversification drive initiated by the group which has under its umbrella investment banking, conventional banking and property development.

“The customers will have three options before them. They can very well continue with EIB as a customer with an Islamic bank; they can transfer their accounts to Emirates Bank; or if they want to leave the bank, they have the choice to do so,” says Sulaiman Maz-roui, chief manager, group affairs of Emirates Bank Group.