SRC to build new Sharia compliant instruments

Saudi Real Estate Refinance Company (SRC),a wholly owned subsidiary of Public Investment Fund (PIF), has been working with Shariyah Review Bureau(SRB) to develop attractive long and short-term financing opportunities for the Kingdom’s economic development. These offerings are geared towards Islamic banks, mortgage financing companies and real-estate originators and are intended to reinforce the optimization of institutional capital and stimulate credit by further incentivizing the house-lending sector.

SRB manages and supervises the Sharia Committee and the supervisory affairs from product reviews to certification and ongoing Sharia Audits for the SRC’s refinancing business.

“We are working on completing a number of portfolio financing and acquisition strategies with SRB and we expect these instruments to allow more real-estate financing businesses to secure stable funding” said Fabrice Susini, CEO of SRC. “Our Murabaha and Ijara based instruments have begun assisting Islamic mortgage financing companies and soon we hope, banks, all vital to the Kingdom’s housing economy helping them freeing up balance sheet for further growth in the local housing sector.”

Licensed by the Saudi Arabian Monetary Authority, SRC has an initial capital of SAR 5 billion for its Saudi mortgage refinancing activities. Elie Chahwan, Chief Financial Officer at SRC stated, “We want to help create a robust financing structure for the local mortgage origination process so that real-estate financing businesses have the funding and support to continue doing business with affordable mortgage credit and ultimately help the Islamic industry move forward.”

Shariyah Review Bureau is a leading Sharia Advisory company of the Middle East helping Islamic financial institutions manage their Sharia compliance affairs from setting up Sharia Boards to product structuring, Sharia certification and Sharia compliance Audits. SRB has 34 Sharia scholars from 18 countries and a dedicated team of in-house Sharia Consultants and Sharia Auditors continuously engaging with clients throughout the investment lifecycle.

“We recognize the need for SRC to have a dedicated resource available at its disposal so as to help them address practical refinancing challenges in light of Sharia compliance,” says Yasser S. Dahlawi, CEO of SRB.“Our Sharia Advisory methodology enables SRC to communicate directly with our Sharia scholars and Sharia consultants efficiently and cost-effectively.”He also added “We remain thrilled to continue working with an organization like SRC and help them serve the economic development of the Kingdom.”