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Bahrain’s sharia-compliant financial institutions enter 2017 after weathering the tumultuous economic environment and changing regulatory landscape of the previous year. Despite the challenges, the kingdom’s Islamic banks continue to expand in the domestic market and beyond, while activity in the newly reinforced sharia-compliant insurance sector is well positioned to continue along a trajectory of premium growth, outstripping that of its conventional counterparts. This chapter contains an interview with Hisham Al Rayes, CEO, GFH Financial Group.

The region’s exchanges have operated in adverse economic conditions since the decline of oil prices began in the second half of 2014, and the Bahrain Bourse is no exception. However, the apparent stabilisation of global oil prices in 2016 has brought a similar firming of the main index and, after a year of shrinking stock prices, some increasingly attractive valuations. The larger story of 2016, however, has been of some important structural advances, such as the introduction of real estate investment trusts and the emergence of a vibrant secondary debt market. More legislative and infrastructural developments due in 2017 promise to sustain this forward momentum. This chapter contains an interview with Najla M Al Shirawi, CEO, Securities and Investment Company.

Bahrain’s banking sector has managed two years of a challenging low oil-price environment without seeing significant deterioration in its financial stability indicators. Conventional lenders and Islamic financiers operating within the kingdom’s famously robust regulatory framework have also managed to maintain profitability throughout this period thanks to efficiency drives and continued government spending on large infrastructure projects. However, with the industry facing a third successive year of low oil prices, efforts to maintain growth margins are becoming more challenging. This chapter contains an interview with Jean-Christophe Durand, CEO, National Bank of Bahrain.

The kingdom of Bahrain has thrived as one of the Gulf’s financial centres for decades. Despite increasing competition from emerging financial centres in the region, its advanced regulatory framework, educated workforce and relatively low-cost environment means that it remains an attractive platform for companies engaging with the wider GCC and beyond. The recent decline in oil prices, however, serves as a reminder of the government’s reliance on its hydrocarbons resources for revenues. Facing a stubborn fiscal deficit, Bahrain is in the process of overhauling its subsidy framework and seeking new income streams, both of which are challenging prospects in an economy renowned for generous social support and light-touch taxation. The kingdom’s long-standing diversification strategy, meanwhile, has taken on a new urgency with the prospect of volatile oil prices for some years to come. This chapter contains interviews with Khalid Al Rumaihi, Chief Executive, Bahrain Economic Development Board; Mahmood Al Kooheji, CEO, Mumtalakat; and Ebrahim Mohammed Janahi, Chief Executive, Tamkeen.

This chapter contains an overview of the legal framework in which local and foreign investors operate in the country, including a breakdown of the distinctions between conventional and Islamic banks, an outline of the employment regulations for both Omanis and foreigners, and a look at commercial and personal bankruptcy laws.