Sharp rise in net profits for Lebanese banks
Banque du Liban et d’Outre-Mer SAL (BLOM), Lebanon’s largest bank in terms of assets and customer deposits, declared net profits of $58.76 million for the first 9 months of 2000, an 11.8 percent increase from the same period last year.
Total assets reached $5.59 billion—up 18 percent since September 1999. Customer deposits totaled $4.8 billion—an 18.3 percent rise year-on-year. Loans grew 15 percent to $1.21 billion.
BLOM’s loan provisions rose from $2.72 million in September 1999 to $5.2 million this year, due to the economic recession. The ratio of loans-to-deposits in foreign currency was 34.6 percent, well below the 75 percent ceiling set by the Central Bank—while the overall ratio stood at 24.95 percent.
The bank’s Tier One capital rose 18.4 percent on a yearly basis to $297.3 million. Earnings per share rose to $4.24 from $3.79 in the first 9 months of last year.
Banque Audi SAL, one of Lebanon’s top 5 banks, posted net profits of $27.81 million for the first 9 months of the year, down 7.07 percent from the same period of 1999.
Total assets reached $3.64 billion, an 18.16 percent rise year-on-year. Customer deposits totaled $3 billion, up 18.35 percent from the same period last year. Loans grew by 6.75 percent to $910 million.
Banque Audi attributed the decline in profits to the ongoing economic recession, higher rates on deposits and an increase in provisions for bad loans. It also blamed a 2.2 percent drop in capital inflows to the country and a 9.6 percent drop in the velocity of money for the lower profits.
The bank’s operating commissions rose by 20 percent to $11 million due to an 87 percent rise in retail banking activity and an 8 percent increase in commissions from commercial banking activity.
Audi expressed interest in expanding to Syria but is waiting for the Syrian government to pass clear banking laws.
Its cost-to-income ratio rose to 60.24 percent from 56.26 percent in September of last year. The higher operational expenditures were due mainly to the opening of 13 new branches—an aggressive advertising campaign, investment in information technology, and a rise in payroll. Annualized earnings per share were $2.34 compared to $2.37 last year.
Banque Européenne pour le Moyen-Orient SAL (BEMO) declared net profits of $3.08 million in the first 9 months of 2000, up 47.83 percent from the same period last year.
Total assets reached $433.19 million, up 22.73 percent from September 1999. Customer deposits totaled $346.41 million, a 27.77 percent rise year-on-year. Loans grew 16.26 percent to $127.83 million. — ( Lebanon Invest )