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Khaleej Times
20-05-2025
- Business
- Khaleej Times
Fintech to elevate the banking industry, says Ibrahim Al Mheiri
Demand for seamless, convenient and accessible transactions is driving uptake of fintech solutions while AI-driven solutions have also enhanced Islamic investment options, providing hyper-personalised results that comply with Islamic principles, says an industry veteran. Ibrahim Al Mheiri, Head of Islamic Banking, Mashreq, said Shariah-compliant banking is actually suitable for every customer, including non-Muslim customers. 'We are seeing increased demand for financial solutions that align with customers' ethical principles, and by its very nature, Islamic banking meets that demand,' Al Mheiri told BTR. In an exclusive interview, Al Mheiri deep dives into how Islamic finance can harness the potential of open banking and embedded finance have made financial transactions seamless, more convenient and accessible. Excerpts from the interview: Fintech has changed banking and sets new benchmarks. How did it revolutionise Islamic banking? As with conventional banking, fintech has had tremendous impact on Islamic banking. Innovations such as open banking and embedded finance have made financial transactions seamless, more convenient and accessible, while digital banking and mobile apps have allowed customers — especially in underserved regions — access Shariah-compliant financial services easily, as well as making transactions faster and more efficient. Technology such as blockchain has enabled greater transparency in Islamic financial contracts, such as Murabaha and Sukuk, increasing compliance. Predictive analytics based on artificial intelligence (AI) and generative AI (GenAI) now help Islamic banks assess creditworthiness in a Shariah-compliant way, avoiding interest-based credit scoring, and sophisticated fraud detection and compliance monitoring tools enhance operational security and regulatory adherence. AI-driven solutions have also enhanced Islamic investment options, providing hyper-personalised solutions that comply with Islamic principles. How do you see fintech will drive Islamic banking in the coming years? Do you think it will help promote Shariah-compliant products? The more fintech — and the associated technology and innovation — makes Shariah-compliant banking and financial solutions more accessible and convenient, the more it will drive uptake of Islamic banking. Essentially, we will see parallels between fintech in conventional banking and fintech in Islamic banking; it stands to reason that what will drive trends in one will be replicated in the other. A key area in which fintech will help promote Islamic banking is in ethics and principles; with tech and innovation enabling ever greater transparency and compliance, the involvement of fintech will make it easier for customers to choose financial products and services that match their religious and ethical requirements. What are the key factors influencing the Islamic banks to adopt fintech and promote its usage in today's day-to-day banking? As with conventional banking, the technology and innovation with which fintechs are associated are enabling something of a revolution, as are shifts in consumer expectations and developments in operational processes. Demand for seamless, convenient and accessible transactions is driving uptake of fintech solutions such as those made possible by open banking and embedded finance, while automation of everyday processes behind the scenes is enabling banks to enhance the customer experience to keep pace with expectations of always-available service. Financial inclusion, a core tenet of Islamic finance, is also a key factor; by adopting fintech solutions and the associated technology and innovation, we can expand our reach, increase financial inclusion and ensure the unbanked and underbanked can access the financial solutions they need. Underscoring all of this is the simple fact that Shariah-compliant banking is actually suitable for every customer, including non-Muslim customers. We are seeing increased demand for financial solutions that align with customers' ethical principles, and by its very nature, Islamic banking meets that demand. Do you see any adverse impact of fintech on Islamic banking? While developments such as automation — with technology and innovation taking over many of the more mundane, previously human-led processes — can naturally cause concern in the banking industry thanks to changes in human capital deployment, we see such changes as an opportunity. Instead of having their time taken up with routine tasks, our teams can focus on customers, and on providing a vastly enhanced customer experience. Automation also means quicker processes with fewer errors, benefiting everyone, and more time to focus on more complex tasks means customers can have their needs met faster and more intuitively. How do you expect fintech to lift Islamic banking in the next five years? We expect fintech to elevate the banking industry, whether conventional or Islamic. Technology and innovation are opening whole new avenues for banks and their customers, with vast enhancements to the customer experience and to operational efficiency. Key areas of evolution will be in driving innovation, enhancing efficiency, expanding reach, and increasing financial inclusion. With the continued acceleration of digital transformation, Islamic finance will become ever more accessible, transparent, and competitive, both in the GCC region and across the globe.
Khaleej Times
20-05-2025
- Business
- Khaleej Times
Cybersecurity serves as the backbone of the fintech landscape
Cybersecurity serves as the backbone of the fintech landscape, enabling secure transactions, protecting consumer interests, and ensuring compliance with regulations. As the sector continues to evolve, the integration of cutting-edge cybersecurity strategies will be crucial in sustaining growth and maintaining trust in digital financial services, according to experts. Industry executives and cybersecurity specialists said cybersecurity plays a pivotal role in safeguarding the burgeoning fintech sector, which encompasses a range of technologies transforming financial services, from mobile banking to blockchain and cryptocurrency applications. 'As fintech companies innovate and expand, they become attractive targets for cybercriminals seeking to exploit vulnerabilities for financial gain. Hence, robust cybersecurity measures are essential to prevent disruptions that can result from data breaches, fraud, or system outages,' say the experts. Cyber Resilience Subhalakshmi Ganapathy, Chief IT Security Evangelist at ManageEngine, said cybersecurity is not just a compliance requirement, but the foundation of financial stability in the UAE's rapidly evolving fintech landscape. 'With digital banking and cryptocurrency adoption surging, the attack surface is expanding, making robust security frameworks essential to preventing financial disruptions,' Ganapathy told BTR. Referring to Statista data, she said the UAE's cryptocurrency market is expected to reach 3.78 million users by 2025, with a penetration rate of 39.13%. 'Regulatory initiatives like the Financial Infrastructure Transformation (FIT) programme and Dubai's Virtual Assets Regulatory Authority (Vara) demonstrate the country's commitment to cyber resilience,' she said. However, she said financial institutions must go beyond regulations, proactively addressing threats such as ransomware, supply chain vulnerabilities, and crypto-specific risks. 'Given the UAE's global financial influence, a single cyber incident could have widespread repercussions. I believe public-private partnerships that integrate regulation with technological innovation are key to ensuring cybersecurity remains a business enabler, not an afterthought,' Ganapathy said. Backbone of Trust Ezzeldin Hussein, Regional Senior Director, Solution Engineering, META, SentinelOne, said cybersecurity is the backbone of trust in the UAE's rapidly growing fintech ecosystem, especially with the rise of digital banking and cryptocurrencies. 'As cyber threats become more sophisticated, financial institutions must proactively defend against fraud, data breaches, and ransomware attacks that could disrupt services and erode consumer confidence,' Hussein told BTR. 'Robust security frameworks, including AI-driven threat detection, zero-trust architecture, and blockchain security enhancements, are essential in mitigating risks. Regulatory compliance, such as adherence to UAE Central Bank guidelines and global security standards, also plays a crucial role in ensuring resilience,' he said. Beyond technology, he said continuous cybersecurity awareness among users and financial professionals is vital. 'Attackers often exploit human vulnerabilities, making education and vigilance just as important as technical defenses. Strong cybersecurity measures don't just prevent financial disruptions, but also enable innovation and long-term growth in the UAE's fintech sector by ensuring a secure and resilient digital financial landscape,' Hussein said. Data Protection, Regulatory Compliance Analysts and IT experts opine that cybersecurity facilitates stability in fintech by protecting sensitive financial data. 'Fintech firms handle personal and transactional data, which if compromised, can lead to identity theft, financial losses, and a loss of consumer trust. Implementing encryption, secure authentication protocols, and regular security audits helps protect against unauthorised access and ensures that customer data remains confidential and intact,' says an expert. In addition to protecting data, he said cybersecurity also aids in compliance with regulatory frameworks that govern financial transactions. 'With regulations like the General Data Protection Regulation (GDPR) and the Payment Card Industry Data Security Standard (PCI DSS), fintech companies must adhere to strict security guidelines. A strong cybersecurity posture not only helps avoid costly fines but also demonstrates a commitment to consumer protection and ethical business practices.' Furthermore, proactive cybersecurity strategies, including incident response planning and continuous monitoring, are vital in swiftly addressing potential threats and vulnerabilities. 'By investing in cybersecurity technologies and fostering a culture of security awareness among employees, fintech companies can significantly reduce the risk of cyberattacks and subsequent financial disruption,' according to an IT specialist.
Khaleej Times
20-05-2025
- Business
- Khaleej Times
Rise of fintech: Reshaping Islamic Finance for global inclusivity
Fintech is poised to significantly reshape Islamic finance by enhancing accessibility, efficiency, and innovation while aligning with Shariah principles and will bridge gaps for the unbanked and underbanked, especially in developing countries with large Muslim populations, experts say. Leading executives, bankers and analysts said platforms like mobile banking, P2P lending, and crowdfunding will provide Shariah-compliant solutions such as microfinance and digital zakat or waqf systems, addressing the $2.5 trillion sustainable development goals funding gap. In addition, blockchain, artificial intelligence (AI) and internet of things will streamline processes and ensure Shariah compliance, enhance transparency and trust, making risk-sharing models like Mudarabah more accessible. 'Fintech will drive Islamic finance towards greater inclusivity, efficiency, and global reach by 2030, leveraging technologies to meet ethical and Shariah-compliant demands. However, success depends on addressing regulatory, literacy, and security challenges while fostering partnerships between traditional institutions and fintech innovators,' according to experts. Jamal Saleh, Director-General, UAE Banks Federation, said the UAE banks are playing a leading role in meeting the growing requirements for Shariah-compliant financial and banking services as well as sukuk issuances, which are witnessing rapid growth. Since the establishment of the world's first Islamic bank in the UAE in 1970s, he said the country has been strengthening its position as a regional and global centre for Islamic banking. 'Accounting for more than 20% of gross banks' credit in the country, and investments of more than Dh150 billion in 2024, UAE's Islamic banks are at the forefront of digitalisation. Smart platforms and solutions integrate artificial intelligence (AI) and blockchain to enhance customer experience while ensuring Shariah compliance,' Saleh told BTR. He said fintech has spurred mobile banking, instant financing, and transparent blockchain-based contracts for Shariah-compliant financial and banking services as well as automating Shariah compliance. 'The UAE's Islamic banks use AI for compliance checks, validating Murabaha agreements, blockchain smart contracts to automate Mudaraba agreements, ensuring transparency and reducing disputes, and machine learning to design ethical investment portfolios aligned with users' risk tolerance and Shariah,' he said. Fitch Ratings views the UAE as a key hub for Islamic finance, with Islamic financing accounting for 29% of total sector financing during the January-June 2024 period as it noticed that financing growth was slightly higher in first half (5.7%) compared to conventional banks (5.3%) despite conventional banks' strong government links. The rating agency expects Islamic banks to continue to grow faster than their conventional peers over the medium term. 'Favourable operating conditions forv 2024 and 2025 should support UAE Islamic banks strong credit fundamentals,' according to Fitch Ratings. Capitalising on Fintech Saleh was of the view that fintech is already helping Islamic banks to develop and promote Shariah-compliant products and services. 'By leveraging AI, blockchain, and data analytics, Islamic banks in the UAE are developing innovative products. Their digital-first strategies are meant to meet all the expectations of customers. 'Many leading Islamic banks are capitalising on fintech to meet the demand for seamless, modern, and secure banking experience while adhering to of Shariah-compliant banking principles. This trend is poised to continue in the coming years in line with Central Bank of the UAE's digital transformation strategy. The UAE's progressive regulatory frameworks, high level of technological adoption, and global partnerships enable the Islamic banks to innovate, grow, and thrive,' he said. Factors Driving Fintech Saleh said Islamic banks are increasingly adopting fintech, balancing between meeting customers' demands and expectations, on one side, and adherence to Shariah principles, on the other side. 'There are many factors driving fintech integration in day-to-day banking such as the regulatory frameworks and initiatives which provide support to further accelerate digital transformation, like the FinTech Office that was launched by Central Bank of the UAE in 2020 as part of its fintech and digital transformation strategy, which is aimed at building a mature ecosystem to position the UAE as the fintech hub regionally and globally. He opined that fintech also enables Islamic banks to automate Shariah compliance checks and develop products like blockchain-based sukuk and AI-driven takaful, ensuring transparency and alignment with Shariah principles. 'Financial inclusion and social responsibility are among the key factors influencing Islamic banks to adopt fintech as they are offering microfinance and other banking solutions via digital platforms, targeting underbanked segments/population.' To a question, he said fintech is poised to significantly elevate Islamic banking by enhancing accessibility, efficiency, and compliance with Shariah principles. 'Customers are moving to digital-first solutions, and Islamic banks and finance houses are addressing this by enhancing their digital and smart offerings. 'From digital onboarding by using AI-driven and blockchain-based KYC and identity verification to simplify account opening, to green finance, risk management, and investment products and solutions, Islamic banks are accelerating the transitions towards smart banking and finance,' he said. He said it is expected to witness a noticeable growth in using AI-powered screening to further automate Shariah compliance checks, blockchain smart contracts for Mudaraba and Ijara agreements, inclusive banking, sukuk issuance, and sustainable underwriting. In addition, fintech will play a greater role in operational efficiency and risk management. 'Metaverse could also be expected to influence the future of Islamic banks. Supported by agile regulatory frameworks and the proactive approach of our Central Bank of the UAE, fintechs should be able to innovate in a secure environment,' he said. A Growing sector Areeb Siddiqui, Founder and CEO at Kestrl, said Islamic fintech is poised to continued expansion across the globe. Referring to people interest in Islamic finance, which is visible as evidenced by new funding vehicles and venture capital allocations, he said the growing sector covers a wide range of customers and financial needs through several emerging technologies. 'I'm incredibly optimistic for this industry of Islamic fintech. The amount of talent that I'm seeing coming from the youth, in particular, people leaving corporate jobs behind or coming straight out of university to start their own businesses within this space incredibly heartening to see,' Siddiqui told BTR. 'Taking the lessons, they've learned from large corporations all over the world. We're seeing that in the UK and the US, but even Pakistan, I'm incredibly proud to see what's going on in Pakistan and how many people are trying to solve this solution. So, I couldn't be more optimistic for the future,' he said. Kestrl was declared the first runner up of the Ethical Finance Innovation Challenge and Awards (EFICA) and awarded Dh75,000 cash prize. Abu Dhabi Islamic Bank (ADIB), in partnership with the London Stock Exchange Group, shortlisted Malaysia-based MADCash, the UK-based Kestrl, and Ethiopia-based Kifiya Financial Technology for the seventh EFICA awards from 150 global applicants. Kestrl, a UK-based fintech supporting over 1.2 million Muslims globally in managing and growing their wealth in line with Islamic finance principles, aims at building a true alternative to the conventional banking system to benefit real people and real economy instead of faceless financial organisations. It offers a platform that helps Muslims to grow their wealth without compromising their beliefs. Siddiqui, a Cambridge MBA with a background in consulting and risk advisory at Deloitte and PwC, sees some challenges for Islamic finance and said fundraising has always been a major issue for the sector. 'A lot of conventional finances see this as a niche, which is bizarre given that we are a two billion population. The other side is regulation, but I'm seeing more and more countries bringing down regulations to allow innovation, particularly in the Muslim world. In Pakistan, we saw five new digital banks; in Malaysia, the same; in the UAE we're seeing more and more, and Saudi Arabia has a huge influx of foreign direct investment, which is really growing the space. So, I think the Muslim world is where it's going to be at for the next 10 or 20 years, In Sha Allah,' said Siddiqui, a specialist in working with banks and wealth managers in the digital space. To a question, he said the UAE has been one of the best places for Islamic fintech evolution, from the DIFC all the way to Abu Dhabi Global Market. 'Even in places like Ajman and Sharjah, all of them are running their own incredible business centres and accelerator schemes. So, fintech is really spoiled for choice when it comes to fundraising and where to set up an office,' he said. Bright Prospects Ahead Faisal Islam, Head of Digital Islamic Finance at Kifiya Financial Technology, sees bright prospects for Islamic finance due to its rising demand across the world. 'I would just like to say that the future is only for Islamic finance because of the risk-sharing model as well as growing appetite from the Muslims. So, it holds the future that we must follow and develop Shariah-compliant products to cater to the rising demand,' Islam told BTR on the sidelines of the seventh EFICA awrads held in Dubai recently. Kifiya was the second runner up of the EFICA and awarded Dh75,000 cash prize. Malaysia-based MADCash won the first prize of Dh300,000. Faisal Islam said the Islamic finance industry has struggled to realise its potential owed to several challenges, including regulatory gaps and lack of adoption stemming from limited awareness and education. 'The challenges are huge because people are used to doing the banking the conventional way. It has been around for 300 years while Islamic banking has just arrived. It's a very new concept with only 70 to 75 years old history. So, the challenge is just the adoption. I cannot see any challenge beyond this because it's just about adoption. We are working on tools to help the people and industry, so Islamic finance gets inclusion and traction,' he said. He said Africa is home to a burgeoning Muslim customer base, which presents significant demand for Islamic finance products and services. About the UAE's role in promoting Islamic fintech, he said the UAE is always at a forefront for innovative and tech initiatives and has developed a strong tech ecosystem in the country. 'Like these EFICA awards, the most prestigious awards in the history of Islamic finance, the UAE has been playing a very active role in promoting Islamic finance. It is connecting people together and doing a lot of good work for this growing sector. And of course, Dubai Islamic Bank and Abu Dhabi Islamic Bank, they are always contributing to the halal economy,' Faisal Islam said. Founded in 2010, Addis Ababa-based Kifiya Financial Technology is pioneering in developing Shariah-compliant digital financing products in Ethiopia as it simplifies complex financial services, bridging the digital divide and fostering financial and market inclusion across Ethiopia. The company offers a diverse portfolio of services in payments, agriculture, micro-insurance, and mobility. Kifiya's mission is to leverage AI driven data and technology for social good, creating a more inclusive and sustainable future. Revolutionising Islamic Banking The Abu Dhabi-based ADIB said advanced technologies like artificial intelligence are transforming financial services and Islamic finance is no different. The second largest Islamic lender in the UAE noticed that Shariah-compliant fintechs are emerging to serve customers and extend financial services to the underbanked. 'Islamic fintech seamlessly integrates Shariah compliance with digital financial solutions, providing customers with easier access to savings, investments, takaful, and financing options that align with Islamic principles,' an ADIB Spokesperson told BTR. 'At ADIB, we believe in partnering with fintech firms and accelerating the development of digital solutions that cater to the evolving needs of our customers. This is why we launched ADIB Ventures, a strategic initiative designed to drive innovation and collaboration within the global financial technology sector. 'Through ADIB Ventures, we aim to build a robust ecosystem by connecting with emerging fintech players and integrating advanced technologies, including Generative AI, to enhance the banking experience for around 1.5 million customers,' the Spokesperson said. Fintech is set to be a major enabler of Islamic banking's next phase of growth, making Shariah-compliant financial products more accessible and appealing to a wider audience. It will allow Islamic banks to reach a larger customer base, including the unbanked and underbanked, thereby enhancing financial inclusion. 'At ADIB, we are committed to partnering with fintech firms across various areas, including automating processes to reduce manual intervention. We are also exploring AI-driven tools for risk assessment and fraud management. For example, we collaborated with Lune, an Emirati fintech company, to launch the region's first personal finance management tool — the ADIB Money Management Tracker. This innovative solution empowers customers with greater control and insight over their financial activities. We are also fostering innovation through initiatives like the EFICA, which recognises fintech solutions that promote ethical banking and financial inclusion. As customer expectations evolve, fintech will continue to shape a more dynamic and inclusive Islamic banking sector.' Fintech Adoption Rising The ADIB Spokesperson said several key factors are driving Islamic banks toward fintech adoption. First, customers increasingly demand seamless, digital-first experiences, prompting banks to modernise their services. Second, regulators across the region are encouraging digital transformation, creating an environment conducive to fintech-driven growth. Additionally, banks are focused on enhancing efficiency, expanding financial inclusion, and improving compliance. 'Fintech adoption supports these objectives by automating banking processes, streamlining financing approvals, and reducing paperwork and manual intervention. From an operational standpoint, automation lowers costs, improves efficiency, and allows banks to scale their services more effectively,' the spokesperson said. Moreover, fintech presents opportunities for Islamic banks to expand into new markets by offering cross-border Shariah-compliant financial solutions. 'ADIB has been at the forefront of this shift, developing API-driven banking solutions and launching innovative digital products such as ADIB Pay and open banking initiatives, reinforcing our commitment to pioneering fintech adoption in the Islamic banking sector.' Reshaping Jobs Role While automation and AI-powered solutions streamline banking operations, they reshape job roles rather than replace them. The key challenge is ensuring that employees are reskilled to manage AI-driven tools and digital banking platforms. 'Islamic banks, including ADIB, are investing in talent development programmes to equip employees with essential digital skills. Additionally, the rapid adoption of fintech introduces challenges related to cybersecurity and regulatory compliance, which require careful oversight.' However, the overall impact of fintech on Islamic banking remains overwhelmingly positive. By enhancing efficiency, lowering costs, and broadening financial inclusion, fintech empowers Islamic banks to deliver more customer-centric and ethical financial services while ensuring long-term sustainability. The ADIB Spokesperson said next five years will witness a significant transformation in Islamic banking, driven by fintech innovation. 'AI-powered Shariah advisory services will become more sophisticated, offering hyper-personalised financial guidance. Digital sukuk and ESG-driven investments will gain traction, enabling wider investor participation in ethical finance through tokenised assets.' Open banking and API integration will foster deeper collaboration between Islamic banks and fintech firms, expanding financial inclusion, particularly in underserved markets. Additionally, sustainable finance solutions, such as green sukuk and carbon trading platforms, will align Islamic banking with global ESG objectives. 'ADIB is actively investing in this future through ADIB Ventures, supporting fintech startups that pioneer next-generation Islamic financial solutions. Through our ADIB 2035 vision, we are leveraging fintech to enhance customer experience, drive efficiency, and reinforce the ethical finance ecosystem,' the Spokesperson concluded.
Yahoo
19-05-2025
- Business
- Yahoo
BTR Unveils Breakthrough Solid-State Battery Solutions and Closed-Loop Recycling at CIBF2025
SHENZHEN, China, May 19, 2025 (GLOBE NEWSWIRE) -- At the 17th China International Battery Fair (CIBF2025), held from May 15 to 17 at the Shenzhen International Convention & Exhibition Center, BTR New Material Group showcased its latest advancements in battery technology, reinforcing its position as a global leader in lithium battery materials. During the exhibition, BTR introduced its comprehensive solid-state and semi-solid battery solutions under the 'BTR SAFE' series. For semi‑solid cells, the lineup includes high‑nickel cathode, polymer and oxide electrolyte, and silicon‑based anode; for all‑solid cells, it features ultra‑high‑nickel and lithium‑rich manganese cathode, sulfide electrolyte, and lithium‑carbon composite anodes. Notably, the high‑nickel cathode designed for semi‑solid batteries exhibited a 110‑minute delay in its thermal runaway peak compared with conventional cathodes—providing critical additional time for emergency response. The silicon‑based anode material achieves up to 2,300 mAh/g, a significant boost in energy density. Complementing its product innovations, BTR unveiled its 'Full-Chain Rebirth' closed-loop recycling solution for cathode and anode materials. For cathodes, the company introduced the S cathode material, produced without precursors, achieving zero wastewater discharge. On the anode side, BTR's 'Flexible Newborn' technology facilitates the renewal of anode materials, highlighted by the debut of R graphite. Through these solid‑state and semi‑solid battery solutions and its closed‑loop recycling strategy, BTR demonstrated not only its strong innovation capabilities but also its commitment to sustainable development within the battery industry. BTR's booth was meticulously designed to showcase its complete technological ecosystem and ESG focus. Key exhibit areas included solid‑state battery materials, fast‑charging anode solutions, integrated application demonstrations, and its closed‑loop recycling processes—drawing widespread attention from industry professionals. About CIBFOrganized by the China Industrial Association of Power Sources, CIBF 2025 is one of the most influential global battery‑industry events, featuring over 3,000 exhibitors and attracting more than 400,000 attendees. About BTREstablished in August 2000 and listed on the Beijing Stock Exchange in October 2021 (stock code 835185·BJ), BTR New Material Group Co., Ltd. is a leader in renewable energy material R&D. Known for its continuous technological innovation, BTR offers advanced technologies and a comprehensive product portfolio, serving both international and domestic markets. Its core products include lithium-ion battery anodes, cathodes, and other advanced materials. FOLLOW US:Official website: CONTACT: BTR New Material Group Janice Jiang Email: pr@ in to access your portfolio
Associated Press
12-05-2025
- Business
- Associated Press
Neinor completes strategic monetization of BTR portfolio, unlocking c.€325mn since 2023
MADRID, May 12, 2025 - Neinor Homes ('Neinor', the leading listed residential property developer in Spain, has completed the sale of two build-to-rent (BTR) projects located in the provinces of Guadalajara and Seville, Spain, to real estate asset manager Round Hill Capital. These BTR schemes have finished construction works during 2024 and are fully operational. Additionally, Neinor has reached an agreement to sell three rental buildings, comprising 128 housing units, located in the provinces of Malaga, Alicante and Valencia to 1810 Capital. The assets belonged to the Sardes Portfolio that was acquired by Neinor in early 2021. Furthermore, as part of the agreement, Neinor will continue to manage and operate these buildings under its rental OpCo, Renta Garantizada. The transactions amount to approximately €50mn. Moreover, these sales will enhance free cash flow generation without a material impact on Neinor's income statement for 2025. Savills advised Neinor on both deals. These deals reflect the appetite for rental housing in Spain and underscores the successful execution of Neinor's BTR monetization strategy Since the presentation of its Strategic Plan, Neinor has sold a total of eleven rental assets to institutional investors, comprising 1,334 housing units located in the provinces of Madrid, Guadalajara, Valencia, Seville, Alicante and Málaga. These sales have generated proceeds of approximately c.€325mn with attractive gross development margins of 24%. Specifically, Neinor sold the following developments: With these transactions, Neinor has completed the monetization of its BTR portfolio. The remaining rental assets, including part of the Sardes portfolio and Olarizu Homes, have been transferred to the build-to-sell strategy and are being commercialized on a retail basis - following the same approach previously applied to over 1,300 units across projects such as Sue 21, Zorrozaurre, Serena, and others. Commercialization environment remains highly dynamic benefiting from solid fundamentals and reiterates positive sector outlook for 2025 Earlier this month, Neinor announced that during 1Q25 has pre-sold 670 build-to-sell (BTS) units, reflecting an 86% year-on-year increase in volumes and 97% year-on-year increase in economic value. This performance was driven by the solid fundamentals of the Spanish Residential sector as well as the ramp-up of the Asset Management division, which allowed Neinor to significantly scale up projects under commercialization. Including BTR disposals, Neinor has pre-sold 921# for €295mn in its strongest start of the year ever. Borja García-Egotxeaga, CEO of Neinor Homes, commented: 'Looking back I am pleased to note that our strategy with a mix between build-to-sell and to-rent disposals has been extremely successful to crystallize the value of Neinor's BTR portfolio, while protecting business margins, accelerate cash flows and optimize our balance sheet. These disposals have played a critical role to fund Neinor's €600mn shareholder remuneration target. Year-to-date we have already distributed c.€125mn in 1Q25 and, more recently, we approved another €31mn payable this week.' Jordi Argemí, Deputy CEO and CFO, stated: 'From a business standpoint nothing has changed in the sector fundamentals as we continue to benefit from accumulated housing demand, lack of supply while financing conditions for homebuyers continue to improve. The margin outlook for FY25-26 continues to improve as we benefit from a solid forward sales position to maximize selling prices. Although gross margins in FY23-24 have been amongst the highest in our history, we are optimistic for upcoming years.' -ENDS- About Neinor Homes Neinor Homes is the leading residential property developer in Spain, with a land bank to develop c12,000 homes, and a GAV to December 2024 of €1.5bn. This land bank is located in some of the fastest growing regions with the best economic fundamentals in Spain: Madrid, Western and Eastern Andalusia, Levante, Basque Country and Catalonia. Neinor is a fully integrated and well-established residential platform of scale in Spain, covering the entire development value chain from land buying, planning and urban management, product design, delegated development and construction, sales and marketing and rentals. We are committed to creating and delivering attractive risk adjusted returns for shareholders through our disciplined capital allocation strategy and our excellence in operations and risk management. We are the only listed residential property developer with a multi-sector strategy to market in Spain, and our strategies include Build-to-rent (BTR); Build-to-sell (BTS); and the largely untapped senior living rental market in Spain, which we are progressing. Neinor's operational excellence, investment strategy and results achieved since 2019 have enabled us to deliver on our 5-year business plan, launched in March 2023, in a sustainable and capital-efficient manner. This plan combines a €600 million shareholder remuneration plan and an investment of €1 billion in new opportunistic land acquisitions, half of which are expected to be undertaken in joint ventures with strategic partners through co-investment agreements, with a +20% IRR target. We offer shareholders attractive risk adjusted returns in a country where there are strong and sustainable supply and demand fundamentals and supported by a resilient macroeconomic environment and outlook. Spain remains one the most attractive and safest residential markets worldwide, with one of the lowest ratios of new supply per capita globally since 2013. For more information: NEINOR HOMES Investor Relations Department [email protected] Contact Elena Torres Quilis - [email protected] Irene Osuna Díez - [email protected] 91 563 77 22 Attachment
