8-K

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 8-K


                                 CURRENT REPORT
     Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934


Date of Report (Date of earliest event reported) December 30, 2005
                                                 ------------------



                            UNIVERSITY BANCORP, INC.
                            ------------------------
             (Exact name of registrant as specified in its charter)


         Delaware                     0-16023                  38-2929531
- ----------------------------       ------------          -------------------
(State or other jurisdiction       (Commission           (I.R.S. Employer
  of incorporation)                File Number)          Identification No.)


2015 Washtenaw Avenue, Ann Arbor, Michigan                    48104
- -------------------------------------------                 ---------
(Address of principal executive offices)             (Zip Code)


Registrant's telephone number, including area code (734) 741-5858
                                                   --------------



Item 1.01 Entry into a Material Definitive Agreement

The Company forms Sharia'a compliant banking subsidiary.



                           Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.



Date:  January 13, 2006                     University Bancorp, Inc.

                                            /s/ Stephen Lange Ranzini
                                            --------------------------------
                                            Stephen Lange Ranzini

EX-99.A9

                                                                Exhibit 99

For Immediate Release
Contact:  Stephen Lange Ranzini, Chairman and President
734-741-5858, Ext. 226
Email: ranzini@university-bank.com


         $15,581,000 DEAL FORMS 1ST U.S. SHARIA'A COMPLIANT BANKING SUB
           INVESTOR GROUP BUYS 20% OF SUB COMMON STOCK FOR $3,000,000


         December 30, 2005, Ann Arbor, Michigan--Stephen Lange Ranzini,
President and Chairman of Ann Arbor's University Bank (NASDAQ: UNIB), announced
the formation of University Islamic Financial Corporation (UIFC). UIFC is
capitalized with $15,581,000 in shareholder equity and assets and is the first
ever U.S. Islamic Banking Subsidiary to be formed. In connection with the
formation of the subsidiary, University Bank sold 20% of the common stock of
UIFC for $3,000,000 to Virtue Investors, LLC, at a 50% premium to book value,
which will generate a capital gain for University Bank of $1,000,000. Of this
amount half of the subscription ($1,500,000) was received today and half will be
received by February 15, 2006. Following the transaction, University Bank holds
80% of the common stock of UIFC with a cost basis of $8,000,000 and $5,581,000
Series A non-convertible preferred stock of UIFC.

         Ranzini commented, "This transaction represents a major milestone in
University Bank's Islamic Banking activities and gives us the resources to put
us on an accelerated growth curve. It also establishes a valuation on our
Islamic Banking subsidiary with a $5 million premium to book value and increases
our consolidated Tier 1 capital base by $3 million to over $7.5 million. From
the point of view of our shareholders, with this transaction and the recent
relocation of the bank's headquarters we have more than doubled the bank's
capital over the course of the year with minimal dilution of the existing
shareholders."

         UIFC intends to engage in Islamic Banking with an initial focus on its
existing product set: soliciting Islamic Sharia'a FDIC-insured Deposits held by
University Bank and originating Islamic Sharia'a home financings as agent for
University Bank. UIFC's products have received favorable legal rulings (fatawa)
from some of the leading Islamic legal scholars in the U.S. and the world.
University Bank is also in the final stages of negotiating a master commitment
with a major Government Sponsored Enterprise to create a secondary market for
UIFC's Sharia'a compliant home financings nationwide.

         For additional information about UIFC's Sharia'a compliant products and
its fatawa, see www.university-bank.com/IslamicBanking/IBDmain.htm.

         Ann Arbor based University Bancorp owns 100% of University Bank which
manages a total of $3.3 billion in assets. University Bank is an FDIC-insured,
locally owned and managed Community Bank primarily serving the cities of Ann
Arbor and Ypsilanti of Washtenaw County. The Community Banking operation focuses
on local businesses, minorities and the non-profit communities. University Bank
is the only financial institution headquartered in Washtenaw County to be rated
"Outstanding" by the FDIC for Community Service and Community Reinvestment.
Other Community Banking specialties include highly competitive deposit products
for business owners, residential mortgages, commercial real estate lending and
insurance, investments and money management through its wholly-owned subsidiary
University Insurance & Investments, Inc. In addition to its Community Banking
operations, University Bancorp specializes in Islamic Banking through 80%-owned
University Islamic Financial Corporation and also in mortgage subservicing and
mortgage origination primarily serving credit unions through the Bank's
Houghton-based 80%-owned subsidiary, Midwest Loan Services.

         Any prediction of the future is inherently not assured. Investors
should read the risk factors listed on pages 21 and 22 in the Company's report
on Form 10K for the year ended December 31, 2004 and any prediction in this
release is intended to be covered by the Safe Harbor provisions of Section 21E
of the Securities Exchange Act of 1934.

         Additional comprehensive investor relations information on University
Bancorp is available at www.university-bank.com/bancorp.htm.