Lebanon’s banking sector: An overview
The consolidated balance sheet of commercial banks for the first 9 months of 2000 indicates the following:
Total assets reached $43.755 billion, an 11.75 percent increase from September 1999
Customer deposits totaled $36.62 billion, up 11.55 percent from the same period last year.
The dollarization rate of deposits was 64.49 percent compared to 63.96 percent in September 1999. Loans to the private sector amounted to $14.66 billion—a 7.43 percent rise year-on-year.
The dollarization rate in lending reached 88.84 percent compared to 88.73 percent in September 1999.
The ratio of loans to deposits in foreign currencies stood at 54.13 percent, well below the Central Bank’s limit of 70 percent, while the same ratio in Lebanese Lira was 14.44 percent. The ratio of total loans to deposits stood at 40.04 percent.
The lower rates of increase in assets and customer deposits compared to previous years continue to reflect the prevailing economic slowdown in the country.
The number of checks written during the first 9 months of 2000 reached 8,077,971 checks for a total value of LL30,171 billion, or about $20 billion. This constitutes a 0.78 percent decrease in the number of checks written and a 1.17 percent rise in value from the same period last year. The number of returned checks reached 291,468 checks for a value of LL1,053 billion, or $698.5 million. This constitutes a 0.04 percent drop in number and a 12 percent decrease in value from the first 9 months of 1999. Returned checks constituted 3.61 percent of the aggregate number of checks written and 3.49 percent of their total value compared to 3.59 percent and 4.03 percent respectively, for the same period last year. Returned checks in foreign currencies accounted for 81.65 percent of total checks returned.
Total banking credits to the private sector reached $14.52 billion in August 2000, up 0.56 percent from July. The trade and services sector accounted for 44.02 percent share of total credits followed by construction with a 21.87 percent share.
Industrial activity came in third place at 12.44 percent, followed by an 11.04 percent share for personal loans. Financial intermediaries and the agricultural sector received 2.92 percent and 1.54 percent of total loans, respectively. Beirut continues to lead all regions with 82.03 percent of total bank credits and comprised 68.24 percent of loan beneficiaries in August.
The Central Bank’s concise balance sheet reached LL16,840.438 billion in the first half of November compared to LL16,788.525 billion at the end of October.
Assets in foreign currencies decreased by $83.84 million to $5.946 billion from $6.03 billion at the end of last month. Assets in foreign currencies increased by $1.189 billion in 1999 and by $486.78 million in 1998. They declined by $1.57 billion in the first 10 months of this year.
Société Générale Libano-Européenne de Banque SAL (SGLEB), one of Lebanon’s top 10 banks, posted consolidated net profits of $18 million in 1999, down 8.47 percent from 1998.
Total assets reached $2 billion, up 5.7 percent from the previous year. Customer deposits totaled $1.71 billion, a 5.84 percent rise year-on-year. Loans grew 28.7 percent to $814.67 million.
SGLEB is part of the French banking group Société Générale. Its assets include local brokerage Fidus, the Amman-based Middle East Investment Bank, and leasing affiliate Sogelease Liban. The bank acquired Inaash Bank earlier this year, raising its branch network to 42 active branches.— ( Lebanon Invest )