The bank paid a bonus-share dividend for 2005 which raised paid-in capital to AED 408.7 million ($111 million). Shareholders have now approved raising this figure in a rights issue to AED 1,000 million ($271 million) through three equal instalments to be held
in September and December this year and in March 2007. Shares will be priced at
AED 10 ($0.30) each compared with AED 7.10 ($1.90) quoted on the Abu Dhabi Securities Market on 12 July. The government of Ras al-Khaimah
will maintain its 1.75 per cent stake.

'There was talk before of making this bank Islamic,' says Buharoon. 'The idea was turned down by the shareholders. We have decided instead to set up an Islamic subsidiary with capital of AED 500 million [$136 million]. We will hold 70 per cent of the shares but the final shareholding structure is still being worked out.'

CBI reported an increase in net profits of more than 200 per cent to AED 237.3 million ($64.3 million) in 2005. Underlying profits are continuing to rise, but the fall in UAE share prices will affect the bottom line.

Buharoon says it has limited exposure to customers who invested in equities but its own investments have been hit. 'I believe the stock market has bottomed,' says Buharoon. 'It's a good time to buy stocks but some shares are still
overvalued.'