International expansion has been the inclination of many of Lebanon’s banks in recent years, and being no strangers to unpredictable security conditions, frequent electrical outages and the slow crawl of legal modernization, the fledgling Iraqi market may well seem an attractive prospect. “The local Lebanese market is saturated with banking services, which made [Lebanon’s Central Bank] eager to encourage banks, such as ourselves and others, to expand outside the local market,” said Chawki Badr, head of international expansion at BBAC, which at the beginning of 2010 began operating a branch in Erbil, Iraq’s third largest city and the capital of the autonomous northern region of Kurdistan. Iraq was a natural location to broaden the reach of Lebanese banks due to the familiar conditions, preexisting trade relationships and the Iraqi government’s incentives to bring international investors in the country — including tax-free status for 10 years and guarantees that no industries
