After years spent in the shadow of its neighbours, Bahrain is hoping to claw back some of the business it has lost as a financial centre in the Arab world.

While rivals such as Dubai have been hit hard by falling property prices and scandals, Bahrain has only wobbled. Two regionally owned but locally based banks, Gulf International Bank and Arab Banking Corporation, have admitted heavy losses from investments in the sub-prime property market. But the island’s promoters say they are the exceptions that prove the rule.