Economics & Policy articles

Take a hike

Take a hike

Crude oil and its derivatives epitomize the notion that besides matching bids and offers, there often lies in the background a multitude of factors, which not only affect prices but also, and more importantly, the perception about supply, capacity, consumption and relative tightness/availability of the product. The movements in crude oil have been, to a

Audi merger sets the stage

The merger of Banque Audi and Banque Saradar was the best thing to happen to the Lebanese banking sector for many years and the biggest merger/acquisition since the Byblos-Banque Beyrouth pour le Commerce and Bank of Beirut-Beirut Riyad Bank deals in 1995 and 2001, respectively. Although the banking sector has been consolidating for the last

Safe from harm?

Is Lebanon a genuine emerging economy? If so, how has the country been able to escape unscathed through the domino-like collapse of new entrants into the global financial architecture. After the implosion of several Asian “tiger” economies and the more recent Russian debt crisis, it seemed that the Lebanese bubble would burst. The common reflections

2004 national budget

There was much debate and not a little bad feeling, but in the end Parliament, after a three-day marathon debate, approved the 2004 state draft budget on April 7, with a vote of 65-31 and one abstention. It was a more realistic budget to the one originally set for 2003, probably due to the government’s

Trouble with stocks

The re-opening of the Beirut Stock Exchange (BSE) in 1996 offered local businesses the means to raise equity funding to finance restructuring and development plans, as well as expansion strategies. It also coincided nicely with the rise in emerging market equities, and the initial listings of Lebanese companies and banks, such as Solidere, Banque Audi

Revitalizing banking

Despite its proud regional reputation, Lebanon’s banking sector has faced a number of hurdles in the past few years. Strong regional competition, stemming from the spawning of a number of large-scale Arab banks – mainly in the Gulf – have created obstacles for a sector seeking expansion, while a high level of liquidity, a large

Moneyed marriage

Following the failed merger talks between Banque Audi and Banque Libano-Francaise in 2002, few anticipated the announcement of last month’s $159 million merger acquisition of Banque Audi and Banque Saradar. Moreover, such a merger differs significantly from the type of consolidation sought by the central bank, namely a consolidation of the smaller, less efficient, banks

Q&A: Freddie Baz

How long were the two banks involved in negotiations before signing the agreement to form a single group? The two banks have had a long proactive relationship. Every now and then we sat together on the managerial level and assessed the situation of the banking industry in Lebanon and the consolidation process. In this favorable

Waiting for BASEL II

The Basel II Capital Accord, the set of rules issued by the Bank for International Settlements (BIS) in 1999 to establish new regulations for banks world-wide, aims to encourage the development of better risk management by banks. Additionally it aims to add momentum to consolidation in the banking sector, change the shape of the credit

Spike in the Euro

Back in January 2002, we analyzed the fate of the euro in this section, looking at its performance since its launch and placing the technical framework for what appeared to be a move up, destined to hit the $1.17-$1.20 area. As is often the case in the currency markets, the euro has not only overshot

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