Bahrain's financial system remains resilient, liquid and strong despite the recent unrest. That is the view of new Standard Chartered Bank Bahrain chief executive Hassan Jarrar.
"I was watching the situation from the UAE and we kept a close eye on outflows and was surprised just how minimal they were," he said. "We thought there would be an outflow of capital but the needle did not move. "This is a reflection of where Bahrain stands in the Middle East. It has the best regulatory system in the region and an amazing level of unspoken confidence and we need to remind people of its success.
"The rest of the region and further afield can learn from how Bahrain's financial system stood up to its problem. People should give Bahrain some credit. It has a 100 years of banking history and that has not changed. The black clouds will go away. Bahrain may be less flash than some places - but it has more substance." He was speaking at a media forum organised by the Bahrain Association of Banks (BAB).
"Despite the problems Bahrain faced we did not see any deflation in the financial sector in 2011," said BAB chairman Abdulkarim Bucheery, who is also chief executive of BBK. "It is too early to tell how 2012 will go but there is optimism in the market." He said the industry enjoyed strong liquidity and the banks were ready to lend if they could find the right projects.
Now that the anniversary of the unrest had past, he said it would help the sector and rating agencies could remove the negative rating on Bahrain. "The situation in Bahrain is much better than people expected," he said. "A couple of banks left but only one of them was connected to unrest. There was no flight of capital or jobs. "A lot of people expected institutions would leave and staff would be cut but none of this happened."