Citibank sets up portfolio with Kuwaiti Islamic bank
A groundbreaking agreement and been signed between one of the United States’ largest financial institution, Citibank, and an Islamic financial institution, the Kuwait Finance House (KFH), which will result in the creation of an $106 million real estate investment portfolio.
A statement released by KFH said that the portfolio would be invested in real estate in the United States, and would provide leasing terms that fall within the framework of Shariah—Islamic law. KFH operates according to religious rules which bans interest and instead calls for profit sharing with depositors.
KFH will contribute $25 million to the real estate portfolio, against $16 million being out up by Citibank. The remainder of the capital will be raised from private and institutional investors. Citibank will act as portfolio advisor and the asset manager in the United States. KFH will pitch the portfolio in the Gulf region, targeting potential investors who prefer to deal only with Islamic banking institutions.
In 2000, KFH reported a gross profit of $376.8 million. – (Albawaba-MEBG)
© 2001 Mena Report (www.menareport.com)