First Gulf Bank has acquired full ownership of Aseel Islamic Finance, raising its stake in the sharia-compliant lender from 40 to 100 per cent.

Aseel, which holds assets worth AED1.5bn in total, will form the bank’s Islamic banking and finance arm with an independent board of directors.

Aseel’s operations have mainly been centered around mortgage products and home financing for individuals. Following the acquisition plans are to diversify its offering, including to customers in the small medium enterprise segment, for which it is developing a range of sharia-compliant murabaha and ijarah products.

“The customer-driven trend for more sharia-compliant financing products in the UAE is clear. We have listened to our customers and our ownership of Aseel will allow us to build on our existing Islamic product portfolio to meet this growing demand,” said Andre Sayegh, chief executive officer of FGB.