Rise in business activities, increasing demand for investment-linked and financial products led 6.7% growth in consolidated assets of the Bahrain banking industry in Q2 of 2008.
The Central Bank of Bahrain said that the total consolidated assets of the Bahrain banking industry grew 6.7% in the second quarter of 2008 over the same period in 2007, as reported by Gulf Daily News.
The consolidated assets of the banking system climbed from $252.5 Billion in the first quarter of 2008 to $269.5 Billion in the second quarter of 2008, an addition of $17 Billion. Also, the banking system assets jumped 26.6% in the past 12 months, where wholesale banks contributed 77.4% and the remaining 22.6% was provided by the retail banks.
The strong growth in the consolidated assets has been attributed to the increased business activities in the sector. Relocation of several high profile international banks in the country confirms the continued support to the banking industry. Collaboration of these banks with regional private banks also assisted the banking industry to expand by opening more business prospects.
Moreover, the banking industry experienced strong demand for wealth management and investment-linked products owing to rising wealth and enlarging base of middle-income population. Apart from this, the economic growth along with strengthening banking and finance sectors are supporting the banking industry that has helped the country in maintaining its status of the leading financial center in the region.
Bahrain banking sector will continue to be buoyant as business conditions in near future are expected to remain favorable. The Economic Development Board (EDB), which provides support for the establishment of new business in Bahrain, will continue to follow its policy of encouraging overseas banks to support the country’s banking industry.
According to a Research Analyst at RNCOS, “High growth in the banking industry of Bahrain will strengthen its economic development as banking contributes significantly to the GDP. It will also help in creating more employment opportunities in both banking and financial sector. The investors are looking at it as a profitable venture as the industry is likely to grow in near future.”
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