Affordable Mortgage and Loan Corporation (AMAL)

MEII has worked with a coalition of organizations to develop the first affordable home mortgage finance company in the Palestinian territories. The Affordable Mortgage and Loan Corporation (“AMAL”, meaning ‘hope’ in Arabic) will provide nearly $500 million in long-term, affordable mortgage loan funding to leading local Palestinian financial institutions, which will double the number of Palestinian families who are able to purchase a home. MEII’s partners include the Bank of Palestine; Cairo Amman Bank; CHF International; the International Finance Corporation (IFC), a member of the World Bank Group; the U.S. Overseas Private Investment Corporation (OPIC), a U.S. government agency designed to facilitate U.S. private sector investment in less-developed countries; the Palestine Affordable Housing Association (SAKAN), a Palestinian non-governmental organization designed to support affordable housing in Palestine; the Palestine Investment Fund (PIF), an independent, state-owned investment fund working on economic development in Palestine; the U.K. Department for International Development (DFID) and the United Nations Human Settlements Program (UN HABITAT).

Program Details

The program will offer fixed-rate and variable-rate mortgage loans of up to 25 years. Funding for the company will come from OPIC, which will provide $241 million to the program; IFC, which will provide $72 million; PIF, which will provide $72 million; the Bank of Palestine and Cairo Amman Bank, which will collectively provide $100 million; and DFID, which will provide $20 million in financing to support the mortgage lending program.

AMAL, which was incorporated in the West Bank by MEII, CHF International, SAKAN, the Bank of Palestine and Cairo Amman Bank, will direct and administer the mortgage lending. The banks will assume all origination and servicing efforts and will be the point of contact with the borrowers. Although AMAL will rely on a network of financial institutions to market the fixed-rate mortgage product to prospective homebuyers, the company will establish minimum standards for underwriting and documenting the mortgage loans

Objectives

The goal of the AMAL project is to develop a sustainable Palestinian mortgage finance marketplace, including (1) fully capable financial service providers with the origination, underwriting and servicing skills necessary to profitably manage mortgage finance operations; and (2) adequate market-based funding for mortgage finance through development of mortgage finance-based opportunities in local and regional capital markets.

In addition, the mortgage finance program will support the further development of the Palestinian financial services sector through technical assistance programs that will be sponsored by the World Bank, IFC and the United States Agency for International Development. Homebuyers will also be exposed to financial education so that they fully understand the impact of the monthly payment of their family’s finances.

Resources

Bank of Palestine
Cairo Amman Bank
CHF International
DFID
IFC
OPIC
PIF
SAKAN (Email)
UN-HABITAT