Slumping volumes hit Premier Financial Brokerage, the latest financial services firm to suspend trading operations.
Another brokerage shuts its doors
Another financial brokerage has shut its doors as a trading drought across local markets saps the industry of fees.
Premier Financial Services, based in Abu Dhabi, said it had received the approval of the country's stock exchange regulator, the Securities and Commodities Authority (SCA), to suspend its brokerage activities for up to six months.
"The markets are not helping," said Ahmed Al Hamed, a manager at the firm. "It was a board decision."
The firm will terminate its trading activities on November 11, Mr Al Hamed said, and clients would have to visit the company's offices to close their accounts.
In accordance with SCA requirements, Premier Financial Services must immediately refund its clients' credit balances. It must also transfer out of its custody any securities held at that time.
The market slowdown has been felt both by small brokers and global investment companies.
Nomura and Credit Suisse are among the larger players to have cut jobs in their research teams amid muted activity on local stock exchanges.
"It's a tough time at the moment for the entire industry," said Nabil Farhat, a partner at Al Fajer Securities, based in Abu Dhabi.
"Current volumes can only take 10 brokerages at the moment, to cover their expenses and break-even."
Brokerage revenues in the Emirates dropped sharply at the start of the year as trading volumes slumped to the lowest since 2004 on the Dubai and Abu Dhabi bourses.
"In the past, brokerages used to survive when trading activity slowed from their own portfolios or ownership in properties," Mr Farhat said.
"But when the stock market has been declining for three months in a row, their portfolios are affected and [they] are forced to sell assets."
Almost half of the brokerages operating in the Emirates at the start of the year have closed after client fees dried up and trading volumes dwindled.
There are 61 brokerages in operation in the UAE, according to trading reports published on local exchanges, down from 103 at the start of last year.