The decision taken by France’s Credit Agricole and Japan’s Tokyo-Mitsubishi bank to leave Bahrain following the unrest in 2011 sparked widespread fears of a mass exodus of financial institutions and led to a slump in investor confidence, casting a shadow of doubt over the performance of Bahrain’s economy. However, three years later, these initial fears seem rather misplaced. Despite a drop in investor confidence, Bahrain’s financial sector has remained intact, and economic growth has rebounded to pre-2011 levels. In the 1980s, in the wake of the Lebanese Civil War, Bahrain established itself as a regional financial center. In recent years, Bahrain has faced intense competition from Dubai and increasingly Qatar, but it has proven resilient due to its solid regulatory …