Author Archives: Nicolas Photiades

Basel II

Basel II

The banking world was rocked in early 2000 when the Basel II Capital Accord came out with its first draft. This accord emanated from the Bank for International Settlements (BIS), which is an international organization whose aim is to promote international monetary and financial cooperation, discussions and policy analysis, and acts as a bank for

Bank capital increase

Lebanese banks have increased their capital significantly over the last decade, as consolidated equity moved from less than $500 million in the early 1990s to slightly more than $6 billion today due to external capital increases, capital injections from existing shareholders and, above all, organic growth. Indeed, the significant profitability of Lebanese banks during the

A real future for Beirut’s financial center potential

During the 1960s and 1970s, Beirut was globally acknowledged as the banking center of the Middle East. Lebanese banks flourished and built up strong franchises by picking up petro-dollar deposits from Gulf investors – particularly after the 1973 oil crisis. Foreign banks increasingly chose Beirut as a regional hub. Beirut, with its cosmopolitan outlook, was

A waste of space

Since its independence, Lebanon has always been gold rich. In fact, during the prosperity years of the 1960s and early 1970s, the country was a net buyer of gold, increasing its gold reserves to a total of 9.22 million ounces today. Lebanon is considered to have the largest gold reserves among Arab countries and is

Hedge Your bets

Founded by Marc Hochar, a former Lebanese investment banker who had spent his entire professional life (more than 13 years) in investment banking and global markets with US investment bank JP Morgan, Melkart Capital has become the talk of Lebanese financial circles and the region. Melkart is the first large-scale international “fund of funds” to

An idiot’s guide to hedge funds

As a follow up to recent articles published in this magazine on fund managers, such as Philippe Jabre and Marc Hochar, and the numerous mentions in these articles of hedge funds, we thought we should shed some light on the meaning or definition of hedge funds, their origins as well as their characteristics. In the

Listing to live

When implemented sometime during 2008, the Basel II Capital Accord will demonstrate that the entire Lebanese banking sector will be in need of extra capital to cover up the underlying risk of their assets. Most banks are expected to see a drop in their capital adequacy ratio (equity divided by risk weighted assets) from an

We’ve said it before and we’ll say it again

Back in September 2005, this magazine published an article about the possibility of holding a donors’ conference in Beirut in December 2005. In the same article, the magazine expressed serious doubts as to the conference taking place in the medium-term, let alone in 2005. The main reasons for these doubts were built on the fact

The shrinking factor

For a long time, there was a widespread belief in Lebanon that the Lebanese sector was highly diversified given the large number of banks (at one stage, the sector had more than 80 institutions). The fact remains that this diversification of the banking system was nothing more than an old myth that had turned into

High Liquidity Saves the day

2005 has been a testing year for Lebanese banks. But it could have been a whole lot worse for the country’s most reliable economic sector were it not for the vision and caution of Lebanon’s central bank, Banque du Liban (BDL), which, seasoned by decades of political and security turmoil, was able to mitigate the

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