Rasmala Investment Bank has become the latest victim of the crisis in equities markets with the closure of its research division.
The closure comes after a recovery in equity volumes and prices over the last two months that have come as a reprieve to the sector.
Rasmala's research division was run as a joint venture with Royal Bank of Scotland (RBS), as part of a tie-up announced in 2010, but closed after RBS decided to pull out.
"We are exiting our cash equities businesses via sale or closure globally. As a result, for the Mea [Middle East and Africa] region, this means there is no further requirement for the joint arrangement with Rasmala, which was solely in place to provide equity research for the cash equities and ECM [equity capital markets] business," said Simon Penney, the chief executive of RBS Middle East and Africa.
He added RBS was still committed to its other businesses in the UAE, including investment banking and its newly opened corporate banking branch in Dubai.
Many brokerages closed their UAE operations last year after the Arab Spring and European debt crisis caused liquidity to dry up.
Today, 55 securities firms are operating in the Emirates, down from 103 at the beginning of last year. Forty-five companies shut down last year, and three have gone out of business so far this year.
But traded value on the Dubai Financial Market (DFM) General Index has risen 722 per cent from November 29 to February 29 to hit US$228 million (Dh837.3m) on Thursday, the highest value since April 2010.
"We were on the verge of closure last year," said Mohamed Sadleh, the operations manager at Al Jazeera Financial Services in Abu Dhabi. "But higher volumes have brought some optimism for us."
The DFM General Index has risen 25.7 per cent so far this year, making it the second-best performing benchmark in the region after Egypt.
"It's all very encouraging," said Khaldoun Jaradat, the trading manager at Brokerage House Securities in Abu Dhabi. "But it needs more sustainability … One good month is not enough to eradicate a year's worth of losses."