Bahrain Islamic Bank launches latest Islamic housing solution

The new scheme provides customers with mortgage finance for an amount of up to BD200,000 with a repayment period extending up to 20 years.

The new product is a mortgage finance facility for buying property to be used as a private residence regardless of the type of such property, whether it is a plot of land, a readily available completed house or still under construction, an apartment or even a property mortgaged with other banks.

For all such purposes, Bahrain Islamic Bank will buy the property and following its acquisition it will be leased to the customer, who is the applicant, against soft-term installments over an extended term. The finance method used is called "Ijara Muntahia Betamleek".

The new product targets middle-income bracket earners who receive salaries of BD800 as the Bank seeks the newly developed product to compete with the currently available products through a much higher ceiling of up to BD200,000 and allowing customers a longer and flexible repayment period of up to 20 years. Customers are offered soft term repayment installments at very competitive profit rate.

In a statement, Yousif Khalaf, Bahrain Islamic Bank Chief Executive said: "The Property Finance Scheme we are launching today "Ijara Muntahia Betamleek" is one of the most important housing solutions that we have decided as a contribution to the Government's effort to solve the housing problems."

He added: "Although we are a profit making institution, we at Bahrain Islamic Bank are primarily concerned with serving the community in which we operate by providing practical and competitive solutions that comply with Islamic principles, especially with housing which is a key problem facing citizens and residents in the Kingdom."

"Since we are a commercial financial institution that serves everyone, no one has been excluded from enjoying the benefits of such a product. It is available for all Bahraini employees, owners of private businesses as well as non-Bahraini employees," he continued.

This new Finance Scheme fully complies with the teachings of Islamic Sharia'a and is approved by the Sharia'a Supervisory Board, which includes a number of reputed and knowledgeable Islamic scholars. Their services are also used by many leading Islamic banks in the Kingdom of Bahrain and outside.

On the features of this product, Khalaf said: "Our new product ensures offering numerous features that we seek to include taking into account our customers' conditions and ensuring optimum convenience and peace of mind."

He continued: "Therefore, such mortgage finance includes life insurance so that the remaining installments are forfeited in case of the customer's death, hence the heirs will have no obligations to the Bank. The property involved will be insured in co-operation with an Islamic insurance company in addition to a highly competitive rate of profit that is considered the lowest available in the market."

To be eligible for mortgage finance, a customer must pay no less than 20 percent of the property's value and his age should not be more than 60 on the date of ownership.

According to its new strategy drawn up by the management, Bahrain Islamic Bank is currently underlining its leadership by investing in developing its infrastructure, including its human resources or new technology. Such strategy also calls for offering new competitive products like the new one and another product that will be revealed shortly.