Bahrain has no plans to shut Islamic units of commercial banks

Bahrain has the largest number of Islamic banks in the Middle East
ISLAMIC BANKS: Bahrain has the largest number of Islamic banks in the Middle East (ITP Images)
By Bloomberg
Wed 16 Feb 2011 05:07 PM

Bahrain,
the Middle Eastern country with the largest number of Islamic banks,
has no plans to shut the Islamic units of commercial banks, said Abdul
Rahman Al Baker, executive director of financial institutions
supervision at the Central Bank of Bahrain.

“We are
allowing Islamic lenders for a long time,” he said in said in Abu Dhabi
on Wednesday. “Conventional banks add value to Islamic banking.”

Qatar’s central
bank told lenders on February 1 that non-Shariah compliant banks would
have to close their Islamic lending branches by year-end and stop
taking deposits in those units immediately.

Deposits and loans at Bahrain’s
banks are “very healthy” and will grow at single-digit rates this year,
and some investment banks have started restructuring, Al Baker said.

“Several of the banks started to restructure their investments, started
to cherry-pick and revisit their investment model,” he said.

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