With the introduction of project finance instruments to complement more familiar short-term trade finance and consumer lending, Islamic banking has found a sound but innovative home in Bahrain. Few financial sectors have grown as quickly as the Islamic banking industry, whose religious precepts have struck a nerve with younger investors in particular across the Muslim world. The financial authorities in the Bahrain Monetary Agency (BMA - the central bank), the Bahraini government and Manama's banking community understood the potential of this trend at an early stage, and sought to create the right conditions in which the nascent industry could thrive, based on the BMA's rigorous rules-driven approach. Bahrain is consolidating its position at the heart of the Islamic industry, providing a base for the majority of the sector's banks, stimulating further growth by encouraging the development of new instruments and placing the sector within a well-regarded regulatory framework.
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