Stake increase in ADF is not a bailout, says Mubadala

Mubadala's plans to increase its stake in the recently launched home lender Abu Dhabi Finance (ADF) from 20 to 52 per cent should not be viewed as a bailout, Abu Dhabi government's investment arm told Emirates Business.

"Absolutely not," said Ali Eid Al Mehairi, Development Director at Mubadala and Chairman of ADF, when asked if the cash injection was a bailout for credit challenges the new entity was facing.

"This is an increased commitment in a business, which has had fantastic results since launch and which, thanks to its strategic partnerships with major real estate developers in Abu Dhabi, has a very strong future," he added.

ADF, a Dh500 million joint venture involving Abu Dhabi Commercial Bank, Aldar, Mubadala, Sorouh and the Tourism Development and Investment Company, formed in November 2008, said that it will offer mortgages with loan-to-value ratios as high as 85 per cent and debt service ratios of up to 55 per cent in a move aimed at bringing liquidity back to the market.

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