The Central Bank of Bahrain (CBB) has opened a consultation on revising minimum paid-up capital requirements for newly licensed locally incorporated retail and wholesale banks and financing companies, proposing materially lower entry thresholds while maintaining ongoing prudential safeguards. Under the proposal, minimum initial capital for conventional and Islamic retail banks would fall to BHD 2 million from BHD 100 million, and for conventional and Islamic wholesale banks to BHD 2 million from USD 100 million, in each case “or equivalent”. Financing companies’ minimum shareholders’ equity would drop to BHD 250,000 from BHD 5 million. The new levels would apply to new licence applicants, while existing licensees would need CBB approval for changes to their capital structure; risk-based capital adequacy requirements under the Basel III framework would continue to apply and scale with each institution’s size, complexity and risk profile. Responses are requested by 10 March 2026, with the proposed amendments available on the CBB website under the “Open Consultations” section.
Central Bank of Bahrain 2026-02-10
Central Bank of Bahrain consults on steep reductions to minimum initial capital for new locally incorporated banks and financing companies
The Central Bank of Bahrain is consulting on reducing minimum paid-up capital requirements for new retail and wholesale banks and financing companies, proposing a decrease to BHD 2 million for banks and BHD 250,000 for financing companies, while maintaining prudential safeguards. Existing licensees require approval for capital structure changes, and responses are due by 10 March 2026.