60 December 2011 BTM Since the beginning of the crisis, most retail banks have been trying to ease the pressure on their consumer clients. “Most banks, including BBK, have introduced a host of initiatives to help our consumers restructure their loans. The government allowed us to offer repayment ‘holidays’ of up to three months to our clients to help them through the crisis,” he says. “Similar assistance to the SME sector has provided businesses the required breathing space. Going forward, banks will need to be even more prudent and make higher provisions for their difficult clients, whether consumers or corporates.” The banking and financial services sector forms the core of Bahrain’s economy, emerging as the single largest contributor to Bahrain’s GDP in recent years despite a downturn in the global financial markets. With 408 banking and financial institutions, the financial services sector accounts for around 27 per cent of Bahrain’s GDP and has total assets amounting to US$198.61 billion. Of this, wholesale banks, including overseas banking units and investment banks, command a sizeable chunk, around US$132 billion, while retail banks account for US$67 billion. Islamic banks account for US$24 billion of the total pie. Saudi Arabia remains the largest investor in terms of deposits in Bahraini banks, investment firms and wealth managers, mostly housed in offshore centres. Bahrain’s unrest from earlier this year may not have had much impact on the operations of the banking sector but, with the downgrade of the Kingdom’s credit rating, the financial implications for the industry will be far-reaching. “The main challenge for banks will be to keep the high quality of their portfolio intact,” observes Abdulkarim A. Bucheery, CEO of BBK and chairman of Bahrain Association of Banks. annualreview Broadening the Remit Banks in Bahrain will need to focus more on cross-border opportunities if they’re to maintain the growth momentum in an increasingly challenging business environment, believes Abdulkarim Bucheery. Abdulkarim Bucheery xxxxx The corporate and commercial banking sectors have shown growth this year owing to the prudent policies of Bahrain’s banks
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