European Islamic Investment Bank (EIIB) is to invest $16 million over 12 months in Dubai-based Rasmala Holdings via a financing facility convertible into shares representing about 35 per cent of the group's enlarged capital.

Rasmala chairman Ali Shihabi said yesterday 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 $900 million in assets, has offices in the UAE, Saudi Arabia, Oman and Egypt and operates in asset management, corporate finance and institutional brokerage.

Shihabi said 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 said yesterday.

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.-Reuters