Beirut’s banking sector healthy but challenges lie ahead

The Lebanese banking sector has survived and thrived through not one but two major shocks in two years: the assassination of Rafik Hariri in 2005 and the Israeli-Hizbullah war in the summer of 2006. A younger or less experienced banking sector would have collapsed under shocks like these, but the shrewdness of Lebanese bankers and banking regulators, the implicit and sometimes explicit support of friendly Arab neighbors and the extraordinary recurrence and solidity of Lebanese deposits and remittances from a very wealthy and influential Lebanese diaspora once again allowed the banking sector to remain solid. This impressive resilience and the continuous financial performance and growth in assets, despite the setbacks, was reflected in Riad Salameh being named best central bank governor in the world for 2006 by the renowned Euromoney magazine. This is not the first time a Lebanese has been honored this way: In 1990, Mr. Edmond Naim also