TBY talks to Joseph G. Sassine, President Director General, Banque de L'Habitat, on the sector.

Joseph G. Sassine

Banque de l'Habitat has decreased the interest rate on lending from 5 to 3% per year. How is the bank managing to remain profitable?

The interest rates are determined according to certain criteria: the cost of funds plus margins to cover the operational cost, the risk, and benefit. Our actual cost of funds is 1%, because the central bank has given us financial facilities at 1%. We add 1% for operational costs, 0.5% to cover the risks, and we keep only 0.5% as a benefit because we are not a commercial bank. The private sector owns 80% of the shares, and the government owns the remaining 20%. The presence of the government in the administration is to supervise the social function of the bank, including long-term housing loans to low-income people. We are here just to positively influence the economy through the housing sector.

What are your priorities and goals for the next year?

We have estimated the volume of our loans for the year 2017 at between LBP450 and 500 billion. I think that we will achieve this target for this year.