“Bahrain Stock Exchange (BSE) and real estate sector recorded the lowest falls in 2008 compared with other bourses and realty markets in the Middle East and North Africa (MENA) region,” Shaikh Ahmed bin Mohammed Al-Khalifa, minister of finance said.
He said that Bahrain had benefited from having less speculative pressures on the BSE and real estate sector.
Shaikh Ahmed, who opened the two-day 11th Middle East Project Finance Conference at the Ritz Carlton Hotel, said that Bahrain’s realty sector showed a resilience in the recent troubled times.
“Bahrain’s real estate sector has slowed down in terms of growth and has not witnessed any significant or material downturn when compared with the process levels of 2007.
Bahrain’s real estate projects have been more concentrated on end users and it appears that the practice of flipping residential properties for short-term speculative gain is not so wide-spread in Bahrain like other markets,” he added. However, the Minister said, support so far has been focused on providing short-term liquidity where needed.
“Given the economic downturn and credit crunch, it is probable that Bahrain real estate projects will continue to sell but at reduced rates. In 2008 we decided to maintain the Central Bank of Bahrain leverage requirements for locally incorporated banks.
The minimum required Basel II capital ratios for our local banks remain comfortably above the 12 percent requirement, which in turn is significantly above the Basel 8 percent requirement,” he said.
