Comparative Performance Evaluation of Selected Commercial Banks in Kingdom of Bahrain Using CAMELS Method

Abstract

The aim of this paper is to analyse the financial efficiency of selected commercial banks in kingdom of Bahrain. Bahrain which is considered as the financial hub of Middle East, play significant role in the economic activities in the Mena Region. Financial sector play a significant role in Bahrain as 16% of the GDP of Bahrain originates from financial sector. The financial efficiency of banks under study is measured by CAMELS analysis. There are 4 retail conventional banks that used as samples in this research out of the 28 conventional and Islamic retail banks in the country. Results show that National Bank of Bahrain, the government bank in the country, has attained highest efficiency compared to its peers in the market.

Keywords: bank efficiency, CAMELS approach, capital adequacy, loans and deposits, market sensitivity

JEL Classification: G10, G21