Qatar injection to boost IBB’s Islamic mortgages

Qatar International Islamic Bank’s (QIIB) £20-million ($31.3m) capital injection to Islamic Bank of Britain (IBB) will help boost the UK bank’s product development plans, including growth in its Islamic mortgage facility.

IBB announced on Wednesday that its shareholders have approved the release of the Qatar fund, which will be used to finance its Home Purchase Plan. Two new products will be launched as a result of the capital injection, the company said in a statement.

“Coinciding with the Islamic holy month of Ramadan, IBB will today launch a 3.99 per cent fixed rental rate product until January 2012 and a variable rental rate product at 4.99 per cent. With an established retail brand in the UK banking sector, the additional capital enables IBB to reinforce its position as the pioneer of shariah-compliant banking,” the bank mentioned.

QIIB, which holds an 11.2 per cent stake in the IBB, said last month that it plans to increase its stake in the shariah-compliant British bank.

IBB added that despite the tough economic climate, it managed to increase its deposits, assets and customer base annually since it was launched in September 2004. It reported customer deposits of over £186m, customer financing at £46m and nearly 50,000 customers in its 2009 financial statements.