Under the 12-year deal, Ibdar will lease the Canadian-built aircraft to Ethiopian with an option for an additional four planes, the lender said in a statement, as use of Islamic financing increases among regional carriers.
Ibdar Bank financed $22 million of the deal through equity, with $78 million secured through a funding agreement with Export Development Canada, the statement said.
The deal marks Ibdar Bank's second Islamic aircraft leasing transaction after it arranged a six-year lease of a Boeing 777-200ER in 2011 for Emirates Airline. Ibdar also participated in a small syndicated deal for Bahrain's Gulf Air in 2009.
Use of lease financing has expanded among commercial airlines. Large carriers, which tend to secure lower lease rates, reduce the risk of a fall in the value of their fleets, while smaller rivals gain aircraft they could not buy outright.
In June, Airbus Group and the Jeddah-based Islamic Development Bank launched an Islamic aircraft leasing fund to cater to growing demand from Gulf airlines such as Etihad Airways, Emirates and Qatar Airways.
But Islamic financing is appealing to a wider set of carriers as the aviation industry sees strong growth across the Middle East, Asia and Africa.
Last month, Dubai Islamic Bank and Air Arabia signed a $230 million Islamic financing deal to cover the purchase of six new Airbus A320 aircraft in 2015 by the budget airline.