How is the Lebanese banking system performing in the midst of a challenging economic environment in the region? What key policy steps have been taken to maintain its stability? Despite the challenging operating environment, the Lebanese banking sector is still reporting a healthy performance of 8 percent growth in total banking activity in 2012. Bank deposits are growing by 7 percent annually, having reached US$136 billion in May. In parallel, lending activity registered more than 10 percent annual growth, with bank credits to the private sector exceeding US$45 billion in May. There are some key measures that have protected our banking sector from international and regional crises and have built a cushion against external and internal political pressure. Lebanese banks have high liquidity ratios and this has allowed them to maintain the flow of credit within the local market. Basel III capital adequacy among Lebanese banks has exceeded 10 percent.
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