Islamic Financial Services
From The Report: Bahrain 2012
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A history of clear regulation and prudent oversight has served the Islamic financial services sector well in the challenging years since the onset of the global economic downturn. It also accounts for the sense of optimism within the sector, despite the challenges that are facing the broader global finance industry. In 2011 the opening of the Bahrain Financial Exchange added new depth to the country’s capital markets and brought with it an Islamic platform, the Bait Al Bursa, which has broken new ground with its sharia-compliant instruments and represents the latest in a long series of sharia-compliant innovations to emerge from Manama. As of April 2012, some 27 Islamic banks had been licensed by the Central Bank of Bahrain to operate in the Kingdom. The presence of such a large number of industry bodies which exert an influence far beyond the borders of Bahrain is one of the reasons why the country will remain a key player in the global Islamic financial service industry. This chapter includes interviews with Mohammed Ebrahim Mohammed, CEO, Bahrain Islamic Bank; and Mohammed Bucheerei, CEO and Member of the Board at Ithmaar Bank.

Articles from this Chapter

Overview

Ahead of the curve: The sector continues to be a leader both regionally and internationally
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The Kingdom of Bahrain is synonymous with Islamic finance, and plays host to the largest concentration of sharia-compliant institutions in the Middle East. Islamic banks, insurance (or takaful) companies and investment firms have thrived within a regulatory regime which was one of the first in the world to recognise the importance of establishing best-practice standards for the industry. The Islamic banking and insurance modules of the Central Bank of Bahrain (CBB) have done much to establish…

Analysis

Playing matchmaker: The central bank continues to encourage mergers, with mixed results
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The Central Bank of Bahrain (CBB) has been at the forefront of the global expansion of Islamic finance for decades and, together with Bank Negara Malaysia, is frequently cited as the body most responsible for its current popularity around the globe. So when, in 2011 the CBB revealed that the bank had urged five Islamic banks to merge in order to strengthen their capital bases, the industry took note. Under the scheme that was revealed by CBB, two mergers would take place in 2012: Al Salam…

Interview

OBG talks to Mohammed Ebrahim Mohammed, CEO, Bahrain Islamic Bank
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Interview: Mohammed Ebrahim Mohammed What are the advantages to be gained from mergers in the Islamic banking sector? MOHAMMED EBRAHIM MOHAMMED: To compete these days, banks should have a strong capital base, which helps in making new transactions and growing the business. For us, as an Islamic bank, the capitalisation would be the biggest achievement. Also, any merger or acquisition helps reduce the fear of competition in the market. Once a strong capital base is established by merging…

Interview

OBG talks to Mohammed Bucheerei, CEO and Member of the Board, Ithmaar Bank
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Interview: Mohammed Bucheere What strategies are being pursued by Islamic banks to reignite growth within the industry? MOHAMMED BUCHEEREI: The multiple economic challenges of the past few years have helped Islamic banks reassess their risk management framework and pushed investors to focus on the benefits of Islamic banking and finance. They have also highlighted previously neglected areas of potential growth across the MENA region. As a result, 2011 was a year of significant growth in new areas…

Analysis

Well-respected: Organisations based in the Kingdom draw global attention
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Claims by Bahrain to be a global centre of Islamic finance rest not just on the plethora of sharia-compliant institutions which have chosen to headquarter themselves in the country, but also on the large array of industry bodies that call Manama home. Of these, the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) is one of the most notable. Its standards have been adopted by jurisdictions across the globe, and in many more it is not uncommon to hear Islamic finance…