European Islamic bank acquires 35% stake in Rasmala

European Islamic Investment Bank is to invest $16m over 12 months in Dubai-based Rasmala Holdings Ltd via a financing facility convertible into shares representing about 35 percent of the group's enlarged capital. Rasmala chairman Ali Shihabi told Reuters on Friday that Rasmala chief executive Anwar Abu Sbaitan would continue in that role. Shihabi will be chairman of Rasmala's supervisory board. Rasmala, which has around $900m in assets, has offices in the UAE, Saudi Arabia, Oman and Egypt and operates in asset management, corporate finance and institutional brokerage. Shihabi told Reuters in November that EIIB was in talks with one party about investing in the bank as part of a capital boost. EIIB confirmed those talks last month. "This transaction will strengthen our balance sheet and allow us to compete more effectively in a challenging but also exciting regional environment," Shihabi told Reuters on Friday. Earlier this year, a slump in turnover forced Rasmala to close its UAE retail brokerage business and to focus on institutional brokerage and research, asset management and corporate finance. Turnover and trading volumes on the Dubai and Abu Dhabi exchanges have fallen, extending a trend that started with the global financial crisis in 2008.