Bond issue still on, says Bahrain central bank


Bahrain's banks are operating as usual and there has been no adverse impact from the protests, the Gulf Arab country's central bank governor said on Thursday.

Echoing comments he made two weeks ago, Bahrain Central Bank Governor Rasheed Al Maraj said on the sidelines of a regional central bankers' meeting the country would still push forward with a planned $1 billion bond issue.

"We have not decided on the timing yet. The plan is still on but we will have to enter the market at the right time," Maraj told reporters.

He added that Bahrain had not yet mandated banks for its planned $1 billion bond issue.

"This is part of our budgetary process," Maraj said.

Bahrain is facing rising expenditures on social items such as subsidies and government houses.

Maraj also said Bahraini banks were operating normal.

But bankers and analysts say Bahraini banks will be impacted as international banks could cut financing lines and local companies in particular in the tourism and retail sector could be forced into debt restructurings.

Rating agencies have lowered Bahrain's sovereign ratings as well as their ratings on some Bahraini banks.

Retail lender Bahrain Islamic Bank postponed a planned $143 million rights issue planned for this week.

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