Offa has acquired Bank of Ireland’s Alburaq Sharia-compliant home finance portfolio, which includes more than 350 home purchase plans.

The deal will see customers transferred over to the Islamic property finance fintech firm, providing a wider range of Sharia-compliance property finance products.

The Alburaq portfolio is one of the oldest Sharia-compliant home finance products in the UK, with Birmingham-based Offa constructing a funding structure to minimise legal and tax issues.

The deal also makes Offa the first financial institution to purchase an Islamic home finance book in the UK.

The firm, which was founded in 2019, provides an ethical finance model, designed in accordance with Islamic finance principles, which means not charging interest and investment into sectors deemed harmful to society, such as alcohol, tobacco and the arms trade.

The acquisition comes after Offa recently launched a new buy-to-let (BTL) service, which instead of using interest, it involves the Islamic finance principles of co-ownership-with-leasing.

The firm has £230m in Sharia-compliant funding for its BTL product, offering capacity for the business to expand and diversify its financial propositions in the UK property market.

Chief financial officer at Offa, Amir Firdaus, said: "It is testament to Offa’s abilities that Bank of Ireland has agreed to sell their Islamic home finance portfolio to us. This marks another chapter in Offa’s ambitious growth plans.

"Members of the Offa executive team are already very much familiar with Alburaq’s clients, having helped distribute this book almost two decades ago, and we are delighted that these customers are now coming home to us.

"Those who have been transferred as part of this purchase and are eligible will now have access to a wider range of Sharia-compliant property re-financing options. We are now focused on ensuring a seamless migration for customers to our servicing platform."

---