GCC Equities Review: Bahrain banks feel the pressure as investors focus on sovereign debt | ZAWYA MENA Edition

GCC Equities Review: Bahrain banks feel the pressure as investors focus on sovereign debt | ZAWYA MENA Edition:

The Bahrain All-Share Index declined in value during the first six months of 2018, but the decline – at 1.6 percent – was not particularly dramatic.

A sovereign debt scare in May, when spreads on credit default swaps ballooned due to fears over the scale of the country’s debt, before receding after neighbouring countries, including Saudi Arabia, the United Arab Emirates and Kuwait all pledged financial support to the kingdom, if required, impacted on the performance of many of Bahrain’s financial firms.

Unsurprisingly, given concerns over the government’s ability to repay its debt, a number of the country’s banks found that their shares came under pressure, with Ithmaar Bank and Khaleeji Bank both witnessing a 31 percent decline in their share price.