The Business Year

Youssef Dib

General Manager, Saradar Bank

There are numerous challenges to doing business in Lebanon, from the macro level of increased regulations, to a subpar infrastructure from roads to internet, not to mention the administrative burden. Talent has been scarcer, not due to education, which remains excellent overall, but more to a lack of international exposure. This is why if you can make it in Lebanon, you can make it anywhere. I remain optimistic about the country’ outlook. The country still faces major challenges in terms of growth, debt, balance of payments, governance, and infrastructure, for example. Despite the flaws, there have been positive things happening in the country. The economy continues to be supported by the diaspora and by the know-how and entrepreneurship of its private sector. Now the government, under the president’s oversight, promises to tackle pending issues to improve the day-to-day life of citizens. It has even promised major investments in infrastructure, with the support of the international community. Lebanon is still an emerging economy, which could have 8-10% growth rates. Within a few years, with public expenditures under control, the debt-to-GDP ratio could drop dramatically, and fast. The reelection of Riad Salamé, the reputed and experienced governor of the Central Bank, has reassured financial markets. As Mr Salamé likes to point out, Lebanon continues to enjoy financing rates that are half of Turkey’s and a third of Egypt’s.

Fadi Daouk

Executive General Manager, BML

We were established in 1929 during the era of King Faruk in Egypt. BML is a Lebanese bank but our major shareholder is Banque Misr in Egypt, which owns 92.8%. BML was first established as Banque Misr Syria and Lebanon. There were three banks at that time in Lebanon, and BMSL played a major role in the economy before and after WWII. During the era of Jamal Abdel Nasser and the problems between Egypt and Syria, the branches in Syria were nationalized and BMSL became BML, Banque Misr Liban. In 2007, BML decided to revamp and restructure. A total of 8% of the staff were women at the time I arrived. We did restructuring and we have done well since. The average age of the staff was 56 and is now 36; and our ratio of women to men is currently 48-52. We invested in our staff and IT systems, introducing the most sophisticated Oracle-based core banking system, and renovated our existing branches. We also expanded our branch network from 14 to 20 branches, with a representative office in the Ivory Coast. Our total assets are USD1.75 billion and are doing about 8-12% annually. We have been aggressive in the market and are moving ahead. We had an expansion program to go to Syria that was put on hold, but will definitely proceed when the time is convenient.

Amine Awad

General Manager, Amine Awad

For the sector, 2016 was a good year, and it was especially true for BLOM. Some of the negative factors in our entities abroad, such as the devaluation of the local currency in Egypt, took place during the last two months of the year, so the impact on consolidated profits when translated into USD was for a limited period of time. Therefore, the impact was small, but we had good results in many of the other entities of the group, mainly Lebanon, the UAE, and Egypt, which are the three main operations of the bank, as well as Switzerland. Lebanon had a good year in general and, of course, we had additional revenues because of the financial engineering set by the Central Bank. For many banks this gave them the opportunity to take all additional provisions required by the Central Bank, including those related to IFRS9 that will be fully implemented on January 1, 2018. We are the second-largest bank by size and profits, but we have the highest profitability ratios (ROAA, ROAE) among listed banks. We have completed the acquisition of HSBC in Lebanon, which means that HSBC became 100% BLOM as of June 17, 2017, after receiving the final approval from the Central Bank of Lebanon. This will boost the balance sheet of the bank by almost USD850 million.



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