The cost of Islamic banking proliferation (Editorial)

The increasing number of Islamic financial institutions is encouraging, yet most of the licenses are being issued in Bahrain to relatively small institutions in the real estate sector. Bahrain may need to reform its financial authorization categories, particularly with regards to institutions licensed as Offshore Banking Units (OBU). As a model for banking in the region, Bahrain should further proliferate high quality institutions that serve the interests of the greater gulf region. The IDB member countries must further liberalize their markets.