The steady growth of sharia-compliant assets suggests banks believe in the future of the sector, but the dismantling of the largest cross-border Islamic window raises questions about whether global banking groups can make a success of the business.

The financial centres of Bahrain, Dubai and Qatar dominate the Gulf's economic sphere and despite some major regulatory changes, the region as a whole is becoming more attractive to international asset managers in search of investable wealth.

Arab banks offset the turmoil of the Arab Spring and offered a robust performance in 2011 with impressive growth across the key financial indicators. And with minimal exposure to the eurozone crisis, the region's banks are expected to continue their recovery from the global financial crisis.

In light of its ongoing political turmoil, many industry players have been quick to sound the death knell for Bahrain's status as the Middle East's financial hub but the country still holds many competitive advantages over its rivals.

From Hong Kong to London, established global financial centres are looking to reinvent themselves as Islamic finance hubs and capture a slice of a fast-growing and still largely untapped market.

Bahrain has had to deal with its fair share of problems on the back of the global economic downturn, but a sound regulatory and supervisory structure and deft handling of the crisis by the central bank has ensured it will emerge as a stronger, more confident nation as a result. Writer Charlie Corbett