Bahraini Spirit
May 19th, 2005, 02:51 PM
Hi, well good news and hopefully this year will be better and so on, enjoy (no need to read all hehe):
Global: Bahrain's financial services industry continued to develop and expand during 2004, with 23 new licenses issued by the Bahrain Monetary Agency (BMA)
Bahrain hosts the largest concentration of banks and other financial institutions in the Middle East region, with nearly 367 financial institutions offering diverse range of services, including money market and portfolio management, investment advice and insurance products involving risk transfer and capital accumulation.
Bahrain's financial sector is growing rapidly and continues to attract banks and financial institutions from all over the world, representing a blend of local, regional and international names.
The pre-eminence of Bahrain's financial sector rests upon the regulatory regime imposed by the Bahrain Monetary Agency, the financial strength of the individual institutions and the professional and technical competence of individuals employed in the industry. The BMA is responsible for the licensing, supervision and regulation of the financial sector and its supervisory and regulatory framework is fully consistent with international standards. Bahrain was one of the first countries outside the G-10 to apply the BIS's 8 percent capital adequacy ratio. Bahrain's financial services industry continued to develop and expand during 2004, with 23 new licenses issued by the Bahrain Monetary Agency (BMA). This brought the total number of financial institutions licensed by the BMA to 367 by 2004-end. This comprises 189 banking institutions, 165 insurance firms and 13 capital market brokers. Of the new licenses issued during 2004, 17 were for banks and banking-related institutions and 6 for insurance and insurance-related operations. The country attracted a good mix of locally-incorporated, regional and international institutions during 2004. The business activities of the new institutions, many of which will serve the Middle East market, also adds value to Bahrain's financial center.
There are currently 29 Islamic financial institutions licensed in Bahrain, including 5 full commercial banks, 16 investment banks and 3 offshore banking units. With the increase in banking activities, assets of the banks showed robust growth. The asset size of the consolidated balance sheet of the banking system in Bahrain stood at US$118.9bn at the end of Dec 2004 compared with US$100.9bn at the end of 2003, representing a jump of 17.8%. At end-Dec 2004, net foreign assets of the banking system were US$4bn. The total domestic assets amounted to US$18.2bn at the end of Dec 2004, an increase of 25.3% over Dec 2003 level.
The Islamic banking industry in Bahrain has grown considerably over the years, satisfying a growing desire of customers to transact their financial activities in accordance with the Islamic Sharia principles. Bahrain, which has spearheaded the Islamic banking activities in the region, has become the natural and convenient location for Islamic finance in the Middle East region with 29 Islamic financial institutions. No other country in the region has created an environment or the legal framework for the operations of Islamic banks. Bahrain is the only country to have created a legal framework for Islamic banks and is one of the few markets that allows dual banking system. The Islamic banking and finance industry in Bahrain encompasses a unique blend of institutions of different categories. Some banks such as Bahrain Islamic Bank, Shamil Bank of Bahrain and Al Baraka Islamic Bank are dedicated fully to Islamic banking services. Other Islamic banks are resident banks with originally conventional banking activities like Arab Banking Corporation, which saw potentially profitable opportunities in diversifying their activities to Islamic banking. A final category of Islamic banks operating in Bahrain is represented by multinational banks like Citi Islamic Bank, a subsidiary of Citicorp. Since the past four years, the total assets of the Islamic banking industry grew at a CAGR of impressive 30.3%. The total assets of Islamic banks and financial institutions operating in Bahrain stood at US$5.43bn at the end of Dec 2004, which was an increase of 30.7% over its 2003-year end level.
The total assets of the OBUs stood at US$98bn at the end of Dec 2004, which represents 17.6% jump from 2003-end level. The total assets of the OBUs witnessed substantial rise after the end of Iraq war, as it increased by 41.8% to US$83.4bn at the end of 2003. In Dec 2004, the total assets of the OBUs were more than 9 times the country's GDP. This indicates the importance of OBUs in the overall economy of Bahrain. The system remains a net external creditor, with net foreign assets amounting to US$1.9bn as of Dec 2004. Domestic assets of the OBUs amounted to US$6.6bn at the end of Dec 2004 while the domestic liabilities amounted to US$8.5bn during the same period.
Commercial banks in Bahrain recorded outstanding performance in 2004. Most of the local listed commercial banks showed higher earnings for the period compared to 2003. The trend that underpinned earnings in 2003 continued into the year 2004 and margins expanded further as the banks enjoyed record low levels of cost of funds at least in the first half of 2004. This coupled with an upbeat lending market further supported the banks earnings for the first nine months of 2004. The consolidated balance sheet of full commercial banks (FCBs) in Bahrain rose to a 10-year high to stand at BD5.5bn at the end of Dec 2004, an increase of 19.5% over that of 2003. The strong performance by FCBs was a reflection of the positive business and economic conditions prevalent in Bahrain and the quality of assets held by those banks. The consolidated balance sheets of FCBs rose mainly on account of 23.9% rise in private non-bank assets which stood at BD2.17bn at the end of Dec 2004. In line with the increase in economic activity, total loans and advances extended to residents by commercial banks increased by 24% during FY2004 and stood at BD2.23bn, compared with BD1.8bn at the end of December 2003. The sectoral distribution of total outstanding loans indicates that 45.2% of the loans were in the form of business lending, while personal and government sector accounted for 45.5% and 9.3% respectively. The low interest rate regime prevalent during the first six months of 2004 induced many retail customers to borrow at lower interest rate.
The consolidated balance sheet of investment banks rose to its 10-year high to US$6.2bn at the end of Dec 2004, representing an increase of 16.6% over 2003. Domestic assets increased by 18.9% to US$1.26bn as of Dec 2004. Share of GCC countries in investment banking assets (excluding Bahrain) was 18%, Western Europe 25.1%, USA 29.8%, and Asia 1.6%, while their shares in liabilities were 31%, 5.6%, 24.8% and 0.2% respectively as of Dec 2004.
Global: Bahrain's financial services industry continued to develop and expand during 2004, with 23 new licenses issued by the Bahrain Monetary Agency (BMA)
Bahrain hosts the largest concentration of banks and other financial institutions in the Middle East region, with nearly 367 financial institutions offering diverse range of services, including money market and portfolio management, investment advice and insurance products involving risk transfer and capital accumulation.
Bahrain's financial sector is growing rapidly and continues to attract banks and financial institutions from all over the world, representing a blend of local, regional and international names.
The pre-eminence of Bahrain's financial sector rests upon the regulatory regime imposed by the Bahrain Monetary Agency, the financial strength of the individual institutions and the professional and technical competence of individuals employed in the industry. The BMA is responsible for the licensing, supervision and regulation of the financial sector and its supervisory and regulatory framework is fully consistent with international standards. Bahrain was one of the first countries outside the G-10 to apply the BIS's 8 percent capital adequacy ratio. Bahrain's financial services industry continued to develop and expand during 2004, with 23 new licenses issued by the Bahrain Monetary Agency (BMA). This brought the total number of financial institutions licensed by the BMA to 367 by 2004-end. This comprises 189 banking institutions, 165 insurance firms and 13 capital market brokers. Of the new licenses issued during 2004, 17 were for banks and banking-related institutions and 6 for insurance and insurance-related operations. The country attracted a good mix of locally-incorporated, regional and international institutions during 2004. The business activities of the new institutions, many of which will serve the Middle East market, also adds value to Bahrain's financial center.
There are currently 29 Islamic financial institutions licensed in Bahrain, including 5 full commercial banks, 16 investment banks and 3 offshore banking units. With the increase in banking activities, assets of the banks showed robust growth. The asset size of the consolidated balance sheet of the banking system in Bahrain stood at US$118.9bn at the end of Dec 2004 compared with US$100.9bn at the end of 2003, representing a jump of 17.8%. At end-Dec 2004, net foreign assets of the banking system were US$4bn. The total domestic assets amounted to US$18.2bn at the end of Dec 2004, an increase of 25.3% over Dec 2003 level.
The Islamic banking industry in Bahrain has grown considerably over the years, satisfying a growing desire of customers to transact their financial activities in accordance with the Islamic Sharia principles. Bahrain, which has spearheaded the Islamic banking activities in the region, has become the natural and convenient location for Islamic finance in the Middle East region with 29 Islamic financial institutions. No other country in the region has created an environment or the legal framework for the operations of Islamic banks. Bahrain is the only country to have created a legal framework for Islamic banks and is one of the few markets that allows dual banking system. The Islamic banking and finance industry in Bahrain encompasses a unique blend of institutions of different categories. Some banks such as Bahrain Islamic Bank, Shamil Bank of Bahrain and Al Baraka Islamic Bank are dedicated fully to Islamic banking services. Other Islamic banks are resident banks with originally conventional banking activities like Arab Banking Corporation, which saw potentially profitable opportunities in diversifying their activities to Islamic banking. A final category of Islamic banks operating in Bahrain is represented by multinational banks like Citi Islamic Bank, a subsidiary of Citicorp. Since the past four years, the total assets of the Islamic banking industry grew at a CAGR of impressive 30.3%. The total assets of Islamic banks and financial institutions operating in Bahrain stood at US$5.43bn at the end of Dec 2004, which was an increase of 30.7% over its 2003-year end level.
The total assets of the OBUs stood at US$98bn at the end of Dec 2004, which represents 17.6% jump from 2003-end level. The total assets of the OBUs witnessed substantial rise after the end of Iraq war, as it increased by 41.8% to US$83.4bn at the end of 2003. In Dec 2004, the total assets of the OBUs were more than 9 times the country's GDP. This indicates the importance of OBUs in the overall economy of Bahrain. The system remains a net external creditor, with net foreign assets amounting to US$1.9bn as of Dec 2004. Domestic assets of the OBUs amounted to US$6.6bn at the end of Dec 2004 while the domestic liabilities amounted to US$8.5bn during the same period.
Commercial banks in Bahrain recorded outstanding performance in 2004. Most of the local listed commercial banks showed higher earnings for the period compared to 2003. The trend that underpinned earnings in 2003 continued into the year 2004 and margins expanded further as the banks enjoyed record low levels of cost of funds at least in the first half of 2004. This coupled with an upbeat lending market further supported the banks earnings for the first nine months of 2004. The consolidated balance sheet of full commercial banks (FCBs) in Bahrain rose to a 10-year high to stand at BD5.5bn at the end of Dec 2004, an increase of 19.5% over that of 2003. The strong performance by FCBs was a reflection of the positive business and economic conditions prevalent in Bahrain and the quality of assets held by those banks. The consolidated balance sheets of FCBs rose mainly on account of 23.9% rise in private non-bank assets which stood at BD2.17bn at the end of Dec 2004. In line with the increase in economic activity, total loans and advances extended to residents by commercial banks increased by 24% during FY2004 and stood at BD2.23bn, compared with BD1.8bn at the end of December 2003. The sectoral distribution of total outstanding loans indicates that 45.2% of the loans were in the form of business lending, while personal and government sector accounted for 45.5% and 9.3% respectively. The low interest rate regime prevalent during the first six months of 2004 induced many retail customers to borrow at lower interest rate.
The consolidated balance sheet of investment banks rose to its 10-year high to US$6.2bn at the end of Dec 2004, representing an increase of 16.6% over 2003. Domestic assets increased by 18.9% to US$1.26bn as of Dec 2004. Share of GCC countries in investment banking assets (excluding Bahrain) was 18%, Western Europe 25.1%, USA 29.8%, and Asia 1.6%, while their shares in liabilities were 31%, 5.6%, 24.8% and 0.2% respectively as of Dec 2004.