Of the new licenses issued during 2005, 24 were for banks and banking-related institutions, 7 for insurance and insurance-related operations, and one was for a capital market broker.

At the end of 2005, the total number of institutions licensed by the BMA stood at 366, comprising 202 banking institutions, 151 insurance and insurance-related operations firms and 13 capital market brokers.

"We managed to attract a good mix of locally incorporated, regional and international institutions during 2005” observed Ahmed Al Bassam, Director of Licensing & Policy at the BMA.

“The business activities of the new institutions, which most of which are serving the Middle East market, will also add value to the Bahrain’s position as a financial center," he added.

The BMA issued licences to several well-known firms across the financial services spectrum last year, which Mr. Al Bassam believes demonstrates the fact that Bahrain remains "the jurisdiction of first choice" for financial institutions in the Middle East region.

Eamar Properties Company, a UAE based Company was granted a license during 2005 to establish Al Salam Bank as a 'retail bank' that is intended to provide financial services to the public according to Shari'ah principles. Licenses were also granted to Mashreq Bank (one of the largest banks in UAE) to provide retail banking, in addition to Vakifbank, Bank Al Habib Limited, Fortis Bank, and Venture Capital Bank, a unique specialist Islamic investment bank which invests in the region's SME sector.

Furthermore, the BMA granted Representative Office licenses to Dexia Private Bank (Switzerland), Man Investment A.G, and LGT Bank of Liechtenstein to offer private banking services to high net worth individuals and institutional investors in the Gulf region.

In the area of insurance, New Hampshire Insurance Company (NHIC) owned by AIG, has been granted a license to open a branch in Bahrain. The Bahrain branch will provide reinsurance services in the Middle East.

Munich Re, the world's largest reinsurance company, was also granted a license during 2005 to establish Med-Net Bahrain as a Third Party Administrator (TPA), to provide administration and management of health claims in the region.

In the area of Capital Markets, the BMA granted a license to Kuwait Middle East Financial Investment Company (KMEFIC), to offer stock brokerage services, and asset management in regional and international securities.

British–based Dawnay Day & Co. Limited, a commodity broking company, was granted a license to establish a broking company in Bahrain.

As part of its efforts to facilitate and support the continuing development of Islamic banking, the BMA and the Tokyo Commodity Exchange (TOCOM), the world’s leading bullion and energy exchange, signed a Memorandum of Understanding (MoU) in September 2005.

The BMA also signed another MoU during 2005 with the Insurance and Pensions Authority of the Isle of Man aimed at mutual cooperation between the relevant supervisory authorities as a means of improving their effectiveness in administering and enforcing the insurance laws of their respective jurisdictions.

The BMA says it has had a number of "significant" applications already in 2006.

“It is a demonstration of the excellent reputation the Kingdom enjoys as an international financial center," noted Mr. Al Bassam.