Lebanese bank assets rise 7.8% y/y to USD 166bn at end-February 2014

By bne IntelliNews April 24, 2014

Lebanon’s banking sector total assets grew 7.8% y/y and 1.0% m/m to LBP 250.3tn (USD 166bn) at end-February 2014, data from the association of banks in Lebanon showed. Despite all odds, the Lebanese banking sector continues to be the key supporter of the country’s creditworthiness and sovereign ratings amid the political and security turmoil.

In April, Standard & Poor's revised its outlook on Lebanon to stable from negative on strong banking sector’s financials and stabilising political situation following the formation of a new government. The banking sector is also the main subscriber to domestic debt issuances, meaning total assets will grow further in 2014.

Total bank deposits, including resident and non-resident private sector deposits and public sector deposits, increased 7.7% to LBP 209.3tn at end-February, accounting for 83.6% of total assets.

LBP-denominated private-sector deposits rose 1.4% ytd to end-February, whereas those denominated in foreign currencies fell 1.3% ytd. The deposit dollarization rate, thus, declined to 65.5% from 66.1% at end-2013. The dollarization rate might ease further in H1 as the government was formed and rival political parties seek to curb violent tensions and boost confidence. The resident private sector deposits accounted for 78.1% of total deposits at end-February, whereas those of the non-resident sector equalled 19.7%.

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