Banking on the good times

The banking sector in Lebanon continued to witness sustained growth throughout the first half of 2004, continuing the trend adopted in 2003, which followed a short lull. Total banking sector assets grew by more than 11.8% year-on-year, reaching LL94,377 billion as of June 30, 2004. Main growth was driven by growth in deposits, with bank deposits standing at LL64,639 billion at the end of June 2004, up 11.7% from the same period last year, and 4.7% from year-end 2003. Despite the considerable growth in assets and deposits, the loan portfolio of the Lebanese banking sector did not undergo significant growth. Total loans to the private sector (both commercial and non-commercial loans) grew by only 1.2% between June 2003 and June 2004, reaching LL23,019 billion. At first glance, a somewhat promising development is revealed in the shrinkage of lending to the government by over 6% between June 2003 and June 2004.