March 15, 2007

Shamil Bank AGM Approved 17% Cash Dividend for 2006
EGM Approves split of shares into 4:1 at US Cents 25 each

Shamil Bank, a leading publicly quoted Islamic retail bank in Bahrain held its annual general assembly yesterday at the Regency Intercontinental Hotel in Manama, Kingdom of Bahrain.

The AGM approved the Board’s recommended appropriations to pay cash dividends of $ 38.8 million ($ 0.17 per share – 17%), an increase of 42% over 2005; transfer of $ 6.1 million to statutory reserves; $ 6.1 to fiduciary reserve and $ 10.1 to general reserve.

An EGM was also held and the shareholders approved the split of the Bank’s shares into 4:1 of US cents 25 each, thereby increasing the number of tradable shares four fold. This step was taken to go in line with the majority of the companies listed on the Bahrain Stock Exchange, to provide a wider base for share trading.

The meetings were chaired by Mr. Mohamed Abdulla Abdulaziz Al-Angari, Chairman of the Board of Directors. Present were also Mr. Zamil Abdulla Al-Zamil, Board member; Mr. Mohamed Hussain, Chief Executive and Ahmed A. Rahim, General Manager Support Group.

The general assembly was opened by a recitation from the Glorious Holy Quran by Shaikh Ismail Al Awadhi, the Bank’s Internal Sharia Auditor. Thereafter, the Chairman presented the Agenda to the meeting, comprising Board of Directors report, presentation of Religious Supervisory Board report and Auditors’ Report for 2006.

“I am delighted to announce that 2006 was a year of excellent operational and organizational achievements for Shamil Bank on all grounds. The increase in net income from $ 39.1 million to $ 61.6 million (57% increase), is attributed to substantial growth in earnings from the Bank’s core business and strategic investment activities, in line with the Bank’s 3-year Strategic Plan for 2006-2008. The Bank’s improved profitability is reflected on the key financial ratios. Earning per Share increased to US cents 27from US cents 17 in 2005, and Return on Average Equity increased to 17.8% from 12.4% in 2005, thereby achieving greater returns for our shareholders.”, said the Chairman.

The meetings were attended by a large number of shareholders, representatives of the Central Bank of Bahrain, Bahrain Stock Exchange, Ministry of Industries and Commerce, representatives of the external auditors, PricewaterhouseCoopers, local and regional media, and senior management personnel from Shamil Bank of Bahrain.

In a press conference following the general assembly, the Chief Executive of Shamil Bank, Mr. Mohamed Hussain, commented: "The year 2006 proved to be the most successful and eventful period in Shamil Bank’s long history which witnessed record financial results and key strategic developments accompanied by significant business and organisational achievements. During the year, the Bank was assigned an investment grade rating by Standard & Poor’s of ‘BBB-’ for long-term and ‘A-3’ for short term counterparty credit rating, with a ‘stable outlook’, while Capital Intelligence upgraded the Bank’s long term foreign currency and financial strength rating to ‘BBB’ from ‘BBB-’ with a ‘stable outlook’ maintained.”

“As a result, Shamil Bank is now a much stronger, more efficient and responsive institution with a brighter future outlook. We will continue to discharge our economic and social responsibilities as a leading Islamic financial institution”, he added.