The Central Bank of Bahrain is developing new rules aimed at strengthening Sharia governance in Islamic financial institutions based in the island-nation.

A Central Sharia Board is being established in Bahrain to help the Islamic financial services industry achieve "consistency in Sharia opinions" as part of the state's pro-Sharia finance initiative.

In the eyes of the island's Government, takaful and retakaful (the co-operative system of reimbursement or repayment in case of loss), Islamic capital markets and wealth management (i.e. equities, funds and sukuk, which is an alternative to bonds), Islamic microfinance, Islamic venture capital and private equity, Islamic SRI (Socially Responsible Investing) and impact investing,  and Zakah and Waqf (charity) are some of the major components of the 'enabling environment' that is needed for sustained progress in Islamic finance.

The Central Bank of Bahrain, which is acting in tandem with the rest of the Government, thinks that a holistic approach should entail the establishment or or improvement of the following for each of the components mentioned above.
1. Regulatory matters.
2. Public awareness and communication.
3. Human resource training and education.
4. Corporate and Sharia governance, on which it is particularly keen as a route to success.
5. Risk management.
6. Standardisation by adopting AAOIFI (the Accounting and Auditing Organization for Islamic Financial Institutions), IFSB (the Islamic Financial Services Board), IIFM (Islamic International Financial Market) and other standards.
7. Tax and accounting matters.
8. Sharing of experience, cross-border co-operation, investments and transactions.

The New Year will see Bahrain adopting Basel III. Domestic 'systemically important' banks have been selected and their resolution and recovery plans are under assessment by the CBB.