Dubai: The planned merger between Dubai Islamic mortgage companies Tamweel and Amlak is still possible in the first quarter as progress is being made, Tamweel's chairman said.

"From our side we see some progress," Shaikh Khalid Bin Zayed Al Nah-yan told Reuters yesterday.

Tamweel and Amlak shares were suspended in 2007 and have not traded since.

The UAE government said in November 2008 it intended to merge the two firms and has been working on a plan to restructure them.

Concerns

"At the same time we have concerns as it is taking too long. It (the merger) is vital for the economy ... first quarter is still possible," Shaikh Khalid said.

He said the new entity's existing capital was about Dh3.5 billion, adding: "The government could come up with another Dh1 billion or Dh2 billion."

A state panel led by the economy minister has been reviewing the merger plans.

In October, the minister said the panel was recommending merging the two lenders into a single Islamic bank early this year.

Shaikh Khalid said Tamweel's default rate was above three per cent.

"It came down at the end of the year, but now it has come back slightly higher."

Dh18b asset sale planned

Union Properties plans to sell some of its assets, which are worth around Dh18 billion, to raise cash, its chairman said yesterday.

"The company has assets of around Dh18 billion," Khalid Bin Kalban told Al Arabiya television in interview. "Some of them are ready to hand over and available for sale."

Kalban said UP has already sold a commercial centre and a department store in Dubai for Dh150 million. He said the sales will be announced pending board approval next week.

The developer is close to completing a number of projects in the Dubai International Financial Centre, including Index Tower, Limestone House and the Ritz Carlton Hotel.

Kalban said if UP decided to sell the Ritz Carlton Hotel it would be worth about Dh1.5 billion.

Union Properties shares closed trading yesterday down 5.6 per cent at Dh0.51. The stock plumbed an intraday level of Dh0.49, its lowest juncture since listing on the Dubai Financial Market in March 2000. The shares have now lost 14 per cent over the past three sessions.