United Arab Bank (UAB) is planning a major move to strengthen its financial position. The bank has announced a new rights issue, aiming to raise up to Dh1.03 billion. This step is part of its strategy to grow, become more competitive, and offer better value to shareholders.
The new capital will help UAB improve its balance sheet, support future growth, and continue building its presence in the UAE’s banking sector.
What is a rights issue?
A rights issue is when a company offers its existing shareholders the chance to buy more shares, usually at a discounted price. In this case, UAB is offering its shares at Dh1 per share.
This means current shareholders can buy more shares at this fixed price. It also allows them to keep their ownership percentage in the bank from decreasing. If shareholders don’t wish to buy more shares, they can sell their rights to others.
Key dates to remember
If you’re a UAB shareholder, here are some important dates:
- Eligibility date: You must hold shares by mid-June to qualify.
- Rights trading period: Late June to early July — you can sell or buy rights on the Abu Dhabi Securities Exchange (ADX).
- Subscription window: Early to mid-July — this is when you can pay to subscribe for the new shares.
- New shares issued: End of July — these will be added to the market.
By following these dates, shareholders can take part in the rights issue and make the most of this opportunity.
Why is UAB launching this rights issue?
The United Arab Bank rights issue is a strategic step. It is not just about raising money — it’s about preparing for the future.
Here are some of the main reasons:
- Increase core capital: The funds raised will help improve the bank’s capital strength.
- Support business growth: UAB wants to expand its lending, services, and operations.
- Enhance investor confidence: A stronger capital base makes the bank more stable and trustworthy.
- Regulatory compliance: It also helps meet the requirements of financial regulators.
This move is expected to support UAB’s efforts to modernize its services, offer more loans, and stay ahead in the competitive banking space.
How much capital will be raised?
UAB aims to raise Dh1.03 billion through this rights issue. Its total capital will increase from Dh2.06 billion to Dh3.09 billion. This is a significant rise and will give the bank more strength to invest in future plans.
What does this mean for shareholders?
If you are an existing shareholder, you have the first right to buy the new shares. This means you can buy additional shares at Dh1, which may be lower than the market price.
There are three main options for you:
- Subscribe for new shares to maintain your shareholding percentage.
- Sell your rights if you don’t want to buy more shares.
- Buy more rights if you want to increase your stake in the bank.
Shareholders who want to buy more than their allocated amount can apply for extra shares. These will be offered if there are any unsubscribed shares left after the offer period.
Refunds for unallocated shares, if any, will be returned shortly after the subscription window ends.
Impact on United Arab Bank’s future
This rights issue is expected to make a positive impact on UAB’s performance in the coming months and years. Here’s how:
- Stronger financial health: More capital means better ability to manage risks.
- Growth opportunities: The bank can expand its services, add more branches, and improve digital platforms.
- Credit growth: More funds allow the bank to provide more loans to individuals and businesses.
- Better investor confidence: A well-capitalized bank attracts more investors.
UAB wants to position itself as a key player in the UAE banking sector, and this capital raise is a big step in that direction.
What should investors know?
Here are a few quick facts for investors considering the United Arab Bank rights issue:
- Share price advantage: Rights shares are priced at Dh1, which could be lower than the market price.
- Trading opportunity: If you don’t want to subscribe, you can sell your rights to others during the trading window.
- New entry point: New investors can also buy rights from existing shareholders and join at a fixed price.
- Oversubscription possible: If you want more shares than you’re eligible for, you can apply — but allocation depends on availability.
Investors should act based on their financial goals and keep an eye on UAB’s upcoming financial results and market updates.
A milestone for the bank
This is a milestone moment for United Arab Bank. The rights issue represents a confident move toward a bigger and better future. It shows that the bank is serious about growing stronger and staying competitive in the fast-changing banking world.
The decision is backed by a clear plan — to strengthen its capital, expand its business, and deliver long-term value to its shareholders.
As the UAE banking sector continues to grow, UAB is working to stay ahead with bold and well-planned steps like this rights issue.
Summary: Why this matters
The United Arab Bank rights issue is more than just a financial event. It reflects the bank’s commitment to:
- Building a strong capital base
- Expanding its reach and services
- Supporting UAE’s growing economy
- Giving shareholders and new investors a growth opportunity
This Dh1.03 billion move could open the door to a new phase of progress for UAB and create long-term benefits for everyone involved.
If you’re a shareholder, now is the time to review your options and be part of the bank’s next big chapter.
Do follow UAE Stories on Instagram
Read More: 9 spots to get the best breakfast in Dubai this June
