Rebuilding Lebanon's Banking Sector: A Post-War Success Story
Post the civil war in Lebanon, the banking sector faced challenges but implemented strategies to rebuild confidence, attract funds, and ensure stability. By focusing on effective regulation, stable exchange rates, and consumer protection, the sector has strengthened, attracting deposits and supporting economic growth.
Uploaded on Mar 13, 2025 | 0 Views
Download Presentation
Please find below an Image/Link to download the presentation.
The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author.If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.
You are allowed to download the files provided on this website for personal or commercial use, subject to the condition that they are used lawfully. All files are the property of their respective owners.
The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author.
E N D
Presentation Transcript
Rebuilding Lebanons Banking Sector A POST WAR SUCCESS STORY Najib Choucair Executive Director Banking Department July 2017
Post Civil War Context & Need for Action 1993 Lebanese economy emerging from civil war Beirut no longer ME s financial hub Economy struggling - massive investment needed Lack of trust in banking sector and LBP Banking sector small and not intermediating funds BDL s MISSION: Rebuild confidence in the banking sector and attract funds to finance GoL & private sector investment needs
BDLs Strategy 4 Pillars to strengthen & develop the banking sector An effective regulation to rebuild confidence & trust Stable exchange rate has proved to be key in the stability of the financial system Establish an efficient financial infrastructure to improve risk management in order to promote a sound and active banking system -- the bedrock of financial system Use innovative means to incentivize growth & extend reach to support all segments of the economy, including MSMEs
BDLs Effective Regulation Rebuilt Confidence & Attracted Deposits Supporting regulations for the MERGERS AND ACQUISITIONS OF BANKS Setting CORPORATE GOVERNANCE RULES according to international standards. IMPOSING CAPITAL REQUIREMENTS AND LIQUIDITY RATIOS (in compliance with Basel II, and recently with Basel III). Supporting the ENACTMENT OF THE ANTI-MONEY LAUNDERING LAW (Law n.318/2001) and regulating the Control of Financial and Banking Operations for Fighting Money Laundering and Terrorist Financing with a role in fighting corruption.
BDLs Effective Regulation Rebuilt Confidence & Attracted Deposits Consumer Protection CIRCULAR #124 Credit Compliance CIRCULAR #128 Concentration CIRCULAR #48
Stable exchange rate has proved to be key in the stability of the financial system by: Preserving a sound banking sector Maintaining low rates of inflation Reinforcing Lebanon s credibility in on the international capital markets scene Boosting the central bank s foreign reserves
Establish An Efficient Financial Infrastructure To Improve Risk Management In Order To Promote A Sound And Active Banking System UPDATING THE PAYMENT SYSTEMS: Regulating CREDIT CARDS, E-PAYMENTS AND E-BANKING. Establishing RTGS and CLEAR systems. Meets INTERNATIONAL STANDARDS & BEST PRACTICES. Enhances SPEED OF MOVEMENT OF MONEY within the national economy, enabling optimum utilization of financial resources. Helps Banks and Financial Institutions to better MANAGE CASH AND REDUCE LIQUIDITY RISK while providing timely and accurate data and statistics to support monetary policy.
Establish An Efficient Financial Infrastructure To Improve Risk Management In Order To Promote A Sound And Active Banking System ENHANCING THE CAPITAL MARKETS: Regulating dealing with foreign financial sectors and avoiding the circulation of highly risky products in the Lebanese markets. Encouraging and regulating the establishment of Financial Institutions and Brokerage Firms. Playing an essential role in the establishment of the Capital Markets Authority (CMA).
Establish An Efficient Financial Infrastructure To Improve Risk Management In Order To Promote A Sound And Active Banking System THE UNPAID CHECKS REGISTRY TO IDENTIFY OFFENDERS ESTABLISHED IN (1996) has grown from zero to 303,386 of records Names of clients with unpaid checks transmitted to banks to exclude such clients from these payment forms. Helps banks assess client risk by giving lender insight into how clients manage their finances. Returned Checks dropped from more 10% of checks in circulation to less than 2%.
Establish An Efficient Financial Infrastructure To Improve Risk Management In Order To Promote A Sound And Active Banking System The development of the CREDIT REGISTRY to track payment history, improve transparency & assess indebtedness of firms & individuals now covers 90% of total private debt Established in 1964 and restructured in 2000 provides both positive and negative information which helps to improve the quantity and quality of credit information ALLOWS LENDERS TO: make better-informed assessments, reduce credit risk, Reduce processing time and costs. The result is a more effective and efficient distribution of credit within the domestic system.
Establish An Efficient Financial Infrastructure To Improve Risk Management In Order To Promote A Sound And Active Banking System SUPPORTING NEW EFFORTS including a COLLATERAL REGISTRY for movable property, bringing MICROFINANCE under Credit Registry to prevent cross lending in this sector.
Use Innovative Means To Incentivize Growth And Increase Access To Finance To Support All Segments Of The Economy, Including MSMEs. Subsidizing loans in several fields (environment, industry ) with sometimes reducing the bank s reserves requirements when such loans are granted. Granting low (or no) interest loans to banks to be used to boost various sectors (housing, start-ups, knowledge economy ). Giving loans at attractive prices to facilitate increased lending like Student loans, Green loans, and Micro-Credit to reach the smallest borrowers. Subsidizing interest to offset crowding out effect of high interest rate environment due to high Government debt.
Total Clients Declared to the Credit Registry 904757 843,034 722,984 Number of Clients 679,863 624,670 563,777 498,628 393,893 321,320 256,548 208,767 172,660 121,937 44,948 Dec-09 Dec-13 Dec-94 Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-10 Dec-11 Dec-12 Dec-14 Dec-15 Dec-16 Years
Total Lending to the Private Sector 64,200 Total Lending to The Private Sector 61,540 57,330 52,902 48,744 43,930 38,690 AMOUNTS IN MILLIONS $ 31,554 27,913 23,035 19,413 17,813 16,414 15,330 13,801 18,000 16,582 16,133 5,8687,7919,538 14,516 11,582 Dec-97 Dec-16 Dec-94 Dec-95 Dec-96 Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 YEARS
Better Risk Management & Growth Dramatically Reduce Sectors NPLs Banking Sector Growth 500,000 34,723 450,000 400,000 37,656 350,000 In Millions of $ 300,000 250,000 200,000 21,501 150,000 15,437 100,000 50,000 2,346 0 Dec-93 Dec-09 Dec-94 Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-93 2,346 3,447 Dec-00 15,437 15,241 Dec-07 21,501 20,418 Dec-13 37,656 47,365 Dec-16 34,723 57,180 Public sector Loans Private Loans Deposits 9,235 10,993 37,632 45,034 67,265 82,228 136,160 164,766 172,230 204,311 Assets
Better Risk Management & Growth Dramatically Reduce Sectors NPLs NPL/Toal Loans 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Dec-00 Dec-13 Dec-94 Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-14 Dec-15 Dec-16
Strong Capital Growth Resulting in CAR for Sector of 16.64% Capital Account 30,000,000 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-16
BDL Total Assets 101,917,682 87,104,238 76,666,434 62,586,745 53,731,198 40,066,060 32,251,601 26,915,983 11,461,298 10,039,417 4,943,274
Number of Beneficiaries in Health Sector 12000 10944 10000 9356 9102 8140 8000 7577 6508 6000 5595 4000 2000 0 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16
Amount of Loans to Health Sector $1,600 $1,515 $1,400 $1,386 $1,200 $1,000 $929 $800 $600 $400 $200 $0 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16
