Bahrain’s economy is maintaining strength and stability despite regional and global challenges, it was revealed. The level of loans and credit facilities has remained stable over the last two years, standing at BD5.9 billion ($15.65 billion).
The figures were revealed as His Royal Highness Prime Minister Prince Khalifa bin Salman Al Khalifa chaired the weekly Cabinet meeting at Gudaibiya Palace.
According to the annual report issued by the Central Bank of Bahrain (CBB) for the fiscal year ending last December 31, the volume of loans and credit facilities given to the construction sector rose by 7.8 per cent last year to top BD1.66 billion, up from BD1.54 billion in 2008.
The number of financial institutions legally operating in Bahrain topped 410. The CBB issued licences for 13 new financial establishments by the end of last year. CBB Governor Rasheed Al Maraj highlighted efforts to tackle the fallout of the global meltdown on the banking sector.
He outlined measures aimed at withstanding the crisis, reducing negative consequences and ensuring financial stability. ‘Efforts also focused on preserving financial stability and ensuring safe banking transactions,’ he said. He also cited steps to protect the financial standing of banks by adopting rigorous policies and introducing new monetary instruments. Al Maraj cited, particularly, the decision to lower interest rates in a bid to alleviate the impact of the global crisis on the financial sector.
The CBB decided to lower the rate of compulsory reserve requirement from 7 per cent to 5 per cent, boosting the ability of retail banks to give loans. The CBB posted BD22.6 million in net profits last year, the report also said.