The Central Bank of Bahrain (CBB) has suspended caps on banks' exposures to the region's troubled real estate markets, banking sources said, highlighting regulators' trouble with containing the crisis aftermath.
"There was a regulation that was issued on the first of August and then on the 18th of August it was withdrawn and suspended completely until further notice," a senior banker at a Bahraini retail bank told Reuters.
Banks in the Gulf Arab region invested heavily in regional property markets during a six-year oil boom, but the bursting of the real estate bubble in the region's tourism and commercial hub Dubai in 2008 raised concerns about their exposure.
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