Bahrain-based Al Salam Bank approved a stock split recommendation at an extraordinary general meeting (EGM) held yesterday.

The move will split shares worth BD1 into 10 new shares worth 100 fils.

At the meeting held at the Ritz-Carlton Bahrain, Hotel and Spa it was also announced that the bank will incorporate a clause to give a 25 per cent share of profits to Zakat, that shares will be listed on all GCC stock exchanges, and that the board of directors, or whomever they delegate, will be authorised to accomplish these goals.

The EGM was attended by over two-thirds of the shareholders and involved several topics aimed at preserving the performance of the bank and also enhancing its position among Islamic banks operating in Bahrain.

"If you are going to list your shares in other markets, then these markets have parameters of pricing and everyone's pricing is one dirham, one riyal, 100 fils, so you have to be in line," Al Salam Bank chairman Mohammed Ali Rashid Alabbar told the Gulf Daily News, our sister newspaper.

"By going to 100 fils I think for the retail investors it makes things more affordable and accessible.

"The idea of having a face value at $5 or $10 is not a fair advantage to the small investors and it also puts more pressure on the management to perform. The stock split and future listing of the shares on several GCC stock exchange markets will make it easier for shareholders and traders to promote the shares, which will reflect positively on the value of it."

Alabbar thanked the EGM for supporting the bank and the board's plans that aim at transforming the bank into a wider sharia compliant provider of Islamic banking facilities.

The 120 million shares of Al Salam Bank Bahrain have been listed on the Bahrain Stock Exchange Market since last year. After the stock split, the number of Al Salam Bank shares will increase to 1.2 billion.

 The bank is also planning to open a branch in the City Centre before the end of this year, said a report in our sister paper Akhbar Al Khaleej. -TradeArabia News Service