Basel III had gone too far, says CBB Governor Al Maraj

Riyadh : Bahrain’s central bank governor said yesterday that stricter international bank rules, known as Basel III, had gone too far and banks had been burdened with too much regulation.

“We have to be careful about how far we go from now onwards, not watering down what we have done but at least we have to give the banking system breathing space so they absorb what we have done, test these new regulations and see what is the impact on economic growth,” Bahrain central bank governor Rasheed Mohammed al-Maraj said at an investment conference in the Saudi capital.

He also told the conference that the row between Qatar and some other Gulf Arab States has paused the progress to a single currency in the six-nation Gulf Cooperation Council (GCC).

Al-Maraj, who was speaking at an investment conference in Riyadh, also said he was committed to Bahrain’s exchange rate peg to the U.S. dollar because it eliminated risks.

GCC states have been discussing creating a single currency for years but economists see it as a distant prospect. The United Arab Emirates has pulled out of the project.