HSBC Amanah Islamic Mortgages No Longer Available in the UK

HSBC Amanah Islamic Mortgages No Longer Available in the UK

HSBC has stopped offering its Amanah sharia compliant islamic mortgages to new customers in the UK.

The bank has ceased to offer Sharia complaint products and services including islamic mortgages  in the UK, the UAE, Bahrain, Bangladesh, Singapore and Mauritius.  Existing customers will not be affected by the changes.

Instead, the lender will focus its Islamic finance offering to  customers in Malaysia and Saudi Arabia, and maintain a limited presence  in Indonesia.

A spokesman for the lender said its decision to pull Islamic mortgage  for new customers is down to a “strategic review of its business.”

The lender first started offering Islamic finance in 2003, but added  that Sharia mortgages are a small business line for it in the UK.

The lender’s Islamic arm, HSBC Amanah, has around 3,000 home finance  customers. The book is currently worth £350m. HSBC’s total UK mortgage  portfolio is in excess of £70bn.

Islamic law prevents Muslims from paying or receiving interest. Under  Islamic mortgages the bank technically buys a property which is rented  to the customer on a 25-year term until sufficient payments have been  made to match the purchase price, plus a small profit.

Following the restructuring, HSBC will retain 83% of the Group’s Islamic business revenue.

Other providers who still offer Sharia compliant products include the  Islmaic Bank of Britain, United Bank UK, Alburaq and Ahli United Bank  UK.

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