Abdullah A. M. Al-Khodari renews SAR290 million Islamic financing with GIB
The Tadawul All Share Index climbed by 0.85 per cent to 8,835.12 points on Sunday, February 2. Construction and contractor firm Abdullah A. M. Al-Khodari Sons Company gained 0.91 per cent to SAR33.20. Earlier in the day, Abdullah A. M. Al-Khodari said that it signed the renewal of an Islamic credit facilities agreement with Gulf International Bank (GIB) in the amount of SAR290.13 million ($78.33m). “These credit facilities are to provide bonding commitments and fund the working capital and capex requirements of the projects. Thirty six per cent of the facilities are funded under Murabaha modes of financing, whereas 64 per cent limits are for multi-purpose bonds and documentary credits.” Under Murabaha, the bank buys assets at a predetermined rate for the customer and re-sells them to him with mark-up rate in order to avoid lending and interest, which are both considered haram or non-permissible under Shari’a. Murabaha is one of three types of bayu-al-amanah – fiduciary sale in Islamic finance.