by Hadeel Al Sayegh and Mathieu Rosemain

DUBAI/PARIS (Reuters) – BNP Paribas plans to reduce its workforce in Bahrain and remove the capital Manama as its Middle East and Africa (MEA) headquarters after deciding that all its local offices in the region would come under Paris, two sources close to the matter told Reuters.

Staff were told in a conference call this week that the changes would lead to a reduction in the workforce in Bahrain by early next year, one of the sources said.

The top French bank’s decision to scrap its Middle East and Africa headquarters comes as competition intensifies between Dubai and Abu Dhabi, in the United Arab Emirates, and Riyadh, in Saudi Arabia, for dominance financial situation in the region.

BNP Paribas, which has offices in these three cities as well as Kuwait, Qatar and Morocco, wants to avoid giving the impression of favoring one city over others in the growing regional rivalry, said one of the sources.

“BNP Paribas, which has operated in Bahrain for more than 50 years, will maintain its significant presence in the country and continue to develop its local activities,” the bank said in a statement sent to Reuters on Wednesday.

“The BNP Paribas group constantly adapts its system in all the countries where it operates, depending on market developments, technology, customer needs and its risk policy,” added the bank.

Bahrain, a vibrant financial center in the 1970s and 1980s, has struggled since the rise of Dubai in the early 2000s and after the country’s Arab Spring uprisings in 2011.

The Bahrain base of BNP Paribas, which provides corporate and institutional banking and investment solutions as well as Islamic finance solutions, employed 261 people at the end of last year, according to the bank’s annual financial report.

(Written by Federico Maccioni; Bertrand De Meyer, edited by Blandine Hénault)

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