Dubai: The double impact of COVID-19 and volatility in the local real estate sector led to losses of Dh239 million for the mortgage provider Amlak Finance. That's against the Dh41 million loss it sustained same time last year.
Revenues for these nine months were at Dh250 million, but this tally excludes unrealised gains/losses from investment properties. Last year's total at this time was Dh190 million.
The company has accumulated losses of Dh2 billion, much of which relates to legacy issues. In fact, a bulk of it stems from fair-value losses on investment properties from 2014. The fair value loss on this specifically came to Dh1.76 billion and recorded in 2014.
But recent months have helped ease the company’s legacy exposures. In June, it won the support of financiers over its debt restructuring.
“Amlak has initiated the process to carry out the new terms of the agreement, which allow more flexibility to adapt to current market conditions and to develop its business to achieve growth in its balance-sheet,” it said in a statement.
In the third quarter, Amlak settled in full with a group of financiers who were carrying higher cost exposures. Last year, in October, Amlak had been awarded Dh780 million in an arbitration judgment.
“The ruling also awarded Amlak Finance its legal costs and additional compensation,” the statement added. “Amlak will proceed with the legal proceedings to execute the ruling and recover the amounts due according to the judgment. The execution would have a positive impact on the financial position.”