News


Over $700M invested in MENA tech startups

Lebanon has climbed to third place in the MENA ranks in terms of investments in tech.

An ArabNet Business Intelligence Report on “the state of Investments” in the region, said that over $700 million were invested in tech startups in MENA between 2013 and October 2015, with Jordan and Lebanon hovering around 50-60 investment deals each.

Lebanon has climbed the MENA ranks with respect to its number of investments, from fifth to third place behind the UAE and Jordan.

“It has done so in under three years, as cumulative investment in the Lebanese digital space since 2013 nears [$]50M, representing thus 15 percent of total MENA investments,” according to the statement.

It noted that the Central Bank announced Circular 331 in 2014, injecting the potential of over $400 million into the Lebanese digital enterprise market, with the goal to assist Lebanon in growing its knowledge economy.

 

“The rise in digital innovation in the MENA region has been coupled with a proliferation of new funding institutions in the past six years, with the number of investors increasing five-fold since 2010,” the statement added.

The statement said the Levant is home to strong investor communities with 30 percent of MENA investors located in Lebanon, Jordan and Palestine.

“ArabNet Beirut 2016 seeks to answer such high demand, by bringing together digital communities from across the Levant and North Africa, on March 1,2 and 3, to discuss the latest in digital and showcase rising entrepreneurial talents,” the statement said.

The Daily Star

27/1/2016


حمود لـ«المستقبل»: لا خفض لتصنيف لبنان في شباط5

” لا خفض لتصنيف لبنان.. وليس هناك من داع لذلك”؟ بدا رئيس لجنة الرقابة على المصارف سمير حمود واثقا مما يقوله عند سؤاله عن احتمال خفض وكالة «ستاندرد اند بورز» لتصنيف دين لبنان السيادي في تقريرها المتوقع في شباط المقبل. وتحضر حاليا لجنة الرقابة على المصارف المعطيات والارقام التي توثق متانة القطاع المصرفي لان «وفودا من وكالات التصنيف قريبا لاجراء عملية تقويم دورية«.

واذ نفى علمه باي لائحة جديدة ستصدرها وزارة الخزانة الاميركية بحق اشخاص لبنانيين، بدا حمود مرتاحا ومطمئنا جدا الى اداء القطاع المصرفي والتزامه جميع المعايير الدولية، وهو ما سيؤكد عليه مجددا وفد جمعية المصارف الى الولايات المتحدة اخر الشهر الحالي.

وعن مسألة تردد مصارف لبنانية في فتح حسابات مصرفية لنواب «حزب الله»، اوضح ان الاميركيين هم من دعاة السيادة الداخلية للبنان شرط عدم المس بهم، وبالتالي فهم يعتبرون ان فتح حسابات بالعملة المحلية هو شأن لبناني خاص». وكشف حمود انه رفع اقتراحا الى حاكم مصرف لبنان رياض سلامه لتعديل التعميم الخاص بتصنيف الديون لمساعدة المصارف على تطبيق معيار» IFRS 9 « الذي يفرض على المصارف تكوين مؤونات على كل ديونها في العام 2018.

بالامس، استقبل حمود وفدا اوروبيا جاء للاطلاع على وضع القطاع المصرفي اللبناني، فشرح لهم بالارقام متانة القطاع. فماذا ابلغهم؟

يقول حمود في حديث لـ«المستقبل»: «رغم كل الازمات التي شهدها العام 2015، الا ان اداء القطاع المصرفي كان ايجابيا بفعل المناعة التي اكتسبها عبر السنوات. وهو تمكن من تحقيق نمو ايجابي جيد مقارنة بما حققته المصارف الاوروبية او الاميركية او حتى بما تحقق في الدول النامية. اذ حقق نموا في ودائعه (نحو 4 في المئة) وان كان بوتيرة أقل من السنوات السابقة، وفي حجم تسليفاته التي نمت بنسبة اقل من السابق بسبب ضآلة قابلية القطاع الخاص على الاقتراض في ظل حال الترقب والحذر والتحفظ وغياب الثقة الذي يعيشه هذا القطاع«.

يذكر ان القطاع المصرفي حقق نموا متواضعا في ودائعه في 11 شهرا العام الماضي بنسبة 3.65 في المئة (مقابل 6 في المئة عام 2014، و8.9 في المئة في 2013، و7.5 في المئة في 2012، و7.9 في المئة في 2011، و11.9 في المئة في 2010، و23.1 في المئة في 2009، و15.6 في المئة في 2008). ووصلت الودائع في الاشهر الاحد عشر الاوائل العام الماضي الودائع الى 157.2 مليار دولار. في المقابل، نمت تسليفات المصارف الى القطاع الخاص بقيمة 2.3 ملياري دولار فقط في 11 شهرا في 2015، مقابل 3.1 مليارات دولار في الفترة نفسها من العام 2014.

واكد حمود ان المصارف لا تزال قادرة ان تمول عجز الدولة بنسبة نمو ودائعها المحققة، و»لكن خطأ ان نقول ان المصارف جاهزة لتمويل القطاع العام، فما يهمها اكثر هو القطاع الخاص، لان هذا الامر يحسن من نوعية محفظة التسليفات التي تمنحها». اضاف «لا اخشى عدم نمو الميزانية المجمعة للمصارف او ارباحها انما اخشى ان يترافق عدم النمو الاقتصادي مع تدني التصنيف لمحفظة التسليفات«.

وهل ان نسبة نمو الودائع البالغة 4 في المئة هي عبارة عن مال جديد دخل الى القطاع او ان جزءا منه سببه الفوائد، قال: «هذا مفهوم شائع. فمن قال ان الفوائد تتراكم كي تنمو الودائع بالفوائد؟ لا يجب ان نقول ان زيادة الودائع ناتجة عن تراكم الفوائد، ولكن يمكن ان نقارن بين نمو الودائع ونمو نسبة كلفة الودائع (حساب ارباح وخسائر) على الليرة او على الدولار. وبالتالي فان النمو المحقق هو نمو حقيقي«.

كما اوضح انه لا يجب مقارنة اداء القطاع بذلك الذي كان عليه في السنوات ما بين 2007 و2010 حين دخلت كتلة نقدية الى لبنان بقيمة نحو 50 مليار دولار، بفعل تداعيات الازمة المالية العالمية من جهة واسعار النفط عالميا من جهة اخرى.

واذ نوه باستمرار تدفق تحويلات اللبنانيين من الخارج، قال «ما نفتقد اليه اليوم هو الاستثمارات لاسيما الاجنبية منها لتفعيل الاقتصاد. نريد ان نشهد اوروبيين وشرق اسيوييين يعودون ايضا«.

يضاف الى كل ذلك، افادة الاقتصاد من حركة النزوج السوري بفعل ارتفاع استهلاك هذه الشريحة، «كما هناك تحويلات تأتي الى سوريين من اقارب لهم في الخارج..علما ان للنزوح السوري سلبيات كثيرة على لبنان، ولو كان الوضع السوري سليما لكنا تطلعنا الى تنمية الاقتصاد بطريقة مختلفة».

التصنيف

وعن تصنيف دين لبنان السيادي، اوضح حمود ان وكالة «ستاندرد اند بورز» لم تخفض تصنيف لبنان انما نظرتها المستقبلية، لافتا الى ان وضع القطاع المصرفي اللبناني هو الذي حمى لبنان من خفض تصنيفه بفعل المستويات التي بلغها، ان في ما يتعلق بنسبة الديون الى الودائع، او حجم الاموال الخاصة، او معايير كفاية رأس المال.

اضاف «توجهنا الى اوروبا واميركا، وتحدثنا الى وكالات التصنيف، واجتمعنا بالاجهزة الرقابية المصرفية في انكلترا وفرنسا وقبرص وبلجيكا. وكان الكل يشيد بمرونة القطاع المصرفي اللبناني وبقدرته على مواجهة اي نوع من الضغوطات او حتى غير البسيطة. كما ان مصرف لبنان ولجنة الرقابة على المصارف حريصان على عدم حصول اي تجاوز لمعايير السلامة العامة او معايير كفاية رأس المال او المعايير الدولية في ظل الحذر الدولي من حركة تنقل المال غير النظيف بين الدول. وهذا امر مهم لاستمرار العلاقة مع المصارف المراسلة«. واكد ان «لا تهاون في هذا الموضوع، فنحن مع السرية المصرفية كاملة في ما يتعلق بالمال النظيف، وضدها اذا كان هناك مال وسخ. وهو امر تكفله القوانين المالية اللبنانية» التي اقرها مجلس النواب اخيرا.

وعن احتمال خفض التصنيف، قال: «لا اتوقع على الاطلاق خفض تصنيف لبنان، وستأتي الى لبنان وفود من وكالات التصنيف الدولية لتقويم اداء السلطة النقدية وسلطة الرقابة المصرفية. وستكون هناك اجتماعات قريبة معهم، ونحن نحضر اليوم الارقام اللازمة لعملية التقويم. كما انني اجتمعت مع ستاندرد اند بورز في باريس مؤخرا، واؤكد انه لن يصار الى خفض التصنيف. ليس هناك من داع لهذا الامر، فالقطاع المصرفي سليم، رغم ان الثغرة الكبرى هي في شق المالية العامة وغياب الموازنات وبالتالي غياب سياسة الحكومة ورؤيتها الاقتصادية«. وحض حمود الحكومة على حسم امرها في ما يتعلق باقرار الموازنة، مشددا على ان ما يشفع الدولة اليوم، في ظل غياب الموازنة والعجز الكبير في الخزينة واستمرار المديوينة، وجود قطاع مصرفي سليم قادر على مساعدتها مع استمرارية سلامة وضعه واستمرار التزامه المعايير الدولية.

رواتب نواب «حزب الله»

وعن الزيارة المرتقبة لجمعية مصارف لبنان الى واشنطن اثر صدور قرار الكونغرس بتعقب الاموال التي تتجه الى «حزب الله»، اوضح ان المصارف اللبنانية ستؤكد للجانب الاميركي مجددا التزامها كل المعايير الدولية.

وعن تردد بعض المصارف اللبنانية في فتح حسابات خاصة بنواب «حزب الله»، قال حمود «ان هذا الموضوع حساس جدا.. فنحن نراهن على عقلانية حزب الله في التعاطي مع القطاع المصرفي. كما اننا نراهن على عقلانية المصارف في التعاطي مع حزب الله. ما هو ثابت بالنسبة الينا هو التزامنا المعايير الدولية، وما صدر عن الكونغرس ستخضع اليه المصارف الاميركية والمصارف الدولية، وبالتالي نحن لا يمكن ان نخل به، والا سنكون في عزلة مالية دولية. وهذا امر غير ممكن لاستمرار عمل المصارف اللبنانية، وحزب الله يدرك هذا الامر تماما. حتى ان الاميركيين انفسهم هم دعاة للسيادة الداخلية شرط عدم المس بهم. فان يكون لدى اشخاص هنا حسابات بالليرة، هو امر خاص بنا«.

يحكى عن لائحة جديدة من العقوبات ستطال اشخاصا لبنانيين. فهل لدى مصرف لبنان اي اطلاع على هذا الامر؟ اجاب حمود «لا يمكن القول ان الاميركيين لن يصدروا لوائح جديدة ليس للبنان فقط بل لدول اخرى، فعينهم على ما يجري في العراق وفي افغانسنان وفي ليبيا وفي سوريا. هم يجرون تحقيقاتهم في شأن تنقل الاموال وتبييضها من دون ابلاغ اي جهة، وبالتالي فان الحديث عن لوائح جديدة وعن اعداد جديدة ليس دقيقا. علما اننا ملزمون تطبيق ما يصدر«.

معيار IFRS 9

هذا، وتواجه المصارف اللبنانية تحديا جديدا اليوم يتمثل بوجوب حملها مؤونات على كل الديون التي تحملها، وهو التزام يجب بدء العمل به في العام 2018، فماذا يقول حمود عن هذا الامر؟

«هذا المعيار معروف بـIFRS 9 وهو ليس جديدا. وبموجبه، يجب ان تكون كل مؤسسة قادرة على اجراء اختبار ضغط على موجوداتها في حال تدني الاسعار بحيث تكون قادرة على ان تشكل مقابلها المؤونات اللازمة. فموجودات المصارف، وخصوصا التجارية، هي عبارة عن سندات خزينة او سندات دين او قروض. لذللك فهي مضطرة لاجراء اختبار ضغط على هذه الموجودات سنويا وان تصنفها عبر 3 مراحل. علما ان المرحلة الاولى يعتبرها القطاع المصرفي امرا جديدا. اذ ان المصارف اعتادت ان تكون مؤونات عند تصنيف الدين دون العادي او مشكوك في تحصيله. ولكنها اليوم ستكون مضطرة الى تكوين مؤونات حتى للحسابات السليمة، وتعريضها لاختبار ضغط سنويا. نحن اليوم في ورشة كبيرة لتوزيع التصنيف. في الخارج يتم اما الاستعانة ببرامج تصنيف او بناء اليات خاصة بالتصنيف. وهو امر مكلف جدا، لذلك نحن نسعى لمساعدة المصارف على درس المؤونة الواجبة على كل تصنيف. وقد ارسلت اقتراحا الى حاكم مصرف لبنان بتعديل تعميم يعطي اوسع عمق لتصنيف الديون من واحد الى عشرة، ليتمكن المصرف من اجراء مقاربة ومطابقة للتصنيف الموضوع من قبل لجنة الرقابة. وعندها يمكننا تحديد حجم المؤونات المطلوبة هند كل مرحلة من المراحل الثلاث». اضاف «من دون شك، سيكون لهذا الامر انعكاس على ربحية المصارف وعلى حجم المؤونات التي تكّون، انما هو معيار دولي لا يمكن اغفال تطبيقه. لكن هذا المعيار ضروري جدا لحماية اموال المودعين والمساهمين كذلك«.

تنظيم الديون

وفي ما يتعلق باعادة هيكلة الديون، اوضح حمود ان مصرف لبنان لم يتلق طلبات. «تلقينا طلبا واحدا لم يستوجب الشروط الموضوعة في التعميم الصادر العام الماضي. ولكن ما اريد ان اشدد عليه في هذا الاطار، هو ان هذا التعميم لم يأت لمرحلة معينة. لا تاريخ له. بل بات جزءا من العمل الائتماني في القطاع المصرفي في لبنان. واعتقد ان هذا التعميم يساعد اكثر في وقت البحبوحة، لانه عندها يكون امكانية كبيرة في اعادة تفعيل مؤسسة ضعيفة«.

هلا صغبيني

المستقبل الإقتصادي
الخميس 14 كانون الثاني 2016 – العدد 5608 – صفحة 11


Finalising post-crisis reforms and Basel III implementation – Basel Committee reports to G20 Leaders

The Basel Committee on Banking Supervision has today published two reports for the G20 Leaders at their Summit in Antalya on 15-16 November.

The first report on Finalising post-crisis reforms: an update reviews the Basel Committee’s work since the global financial crisis to strengthen the international regulatory framework for banks. The report also focuses on the Committee’s substantial progress towards finalising its post-crisis reforms, which includes reducing excessive variability in risk-weighted assets. As a result, the Committee is well on track to finalise the remaining elements of the regulatory reform agenda for global banks.

The second report is an Update on the implementation of Basel III standards since the 2014 progress report to the G20 Leaders. It notes that implementation has generally been both timely and consistent with the globally agreed standards. All Committee member jurisdictions have implemented the Basel III risk-based capital regulations. Final rules on the Liquidity Coverage Ratio are in force in almost all member jurisdictions. Efforts are continuing to adopt the Basel III standards for the leverage ratio and the Net Stable Funding Ratio as well as for systemically important banks.

www.bis.org
November 13, 2015


Lebanon tops Arab world in financial secrecy

It mixes secrecy with big tax exemptions

lebanon-tops-arab

The Tax Justice Network (TJN) said it has ranked Lebanon first in the Arab world and seventh globally in the 2015 Financial Secrecy Index (FSI).

“Lebanon has sailed against the prevailing winds on global financial transparency and continues to make secrecy a core selling point,” according to TJN, which describes itself as “a coalition of researchers and activists focused on the harmful impacts of tax avoidance, tax competition and tax havens.”

Lebanon has a very high secrecy score, which remained basically unchanged since 2013. It mixes financial secrecy with substantial tax exemptions for nonresidents and this makes it a ‘classic’ tax haven, TJN said in the FSI report. The non-resident category consists of the large diaspora that includes high net-worth individuals in addition to depositors from other Arab countries.

With bank assets representing 400 percent of its GDP, Lebanon is more dominated by its banking sector than most other financial hubs. Its offshore financial services sector remained resilient despite the political and security problems. This sector has been growing at an annual average of 12 percent since 2006, with bank deposits reaching nearly $175 billion at the end of 2014.

“Lebanon’s strong focus on financial secrecy has naturally made the country a hotbed of illicit activity,” the TJN report said. It said that Lebanon has merely taken partial measures to abide by international transparency standards.

 

Reported by Shikrallah Nakhoul

Business News

November 17, 2015


Salameh calls for ratification of anti-cybercrime laws

salameh-calls

Salameh: “We have also warned against the use of electronic money such as

BEIRUT: Leading bankers called upon the Parliament Thursday to ratify e-commerce and cybercrimes laws for the protection of Internet users in Lebanon, following reports that millions of dollars were stolen by hackers. “Lebanon still lacks the appropriate legislations for the protection of data transferred through electronic trade operations while serious efforts are needed to fight against the increase in cybercrimes,” said Riad Salameh, the governor of Lebanon’s Central Bank.

Salameh said that cybercrimes are very dangerous because they cannot be controlled within the boundaries of one country which requires serious efforts on the national and international levels. “Also, hackers are anonymous and they cannot be identified which makes it harder to arrest these people.”A law pertaining to the approval of the e-signature is currently being examined by the Parliament but has not been passed yet.

Banque du Liban Resolution 7548 mentions the minimum of precautionary procedures to be taken by a bank before accepting a transfer order.Salameh’s remarks came during an anti-cybercrime forum, which was organized by Al-Iktissad Wal-Aamal group and took place at Four Seasons Hotel, to discuss ways of fighting digital fraud and piracy in the banking and commercial sectors in Lebanon.

Salameh said that despite the lack of proper legislations in Lebanon, the country ranked in seventh place among 10 other countries in UNCTAD’s report about the potential of e-commerce for developing countries. He added that Lebanon witnessed some improvement in the field of e-commerce whereby the Central Bank has secured a proper legislative environment while controlling the cost of such transactions and guaranteeing the protection of clients engaging in electronic banking operations.

Salameh said that the Central Bank has already issued in the past two decades circulars to enhance and improve electronic money transfer operations in addition to transactions done through ATMs.

He added that Circular 69 was issued by the Central Bank in the year 2000 to define electronic financial and banking operations and restrict these transactions to institutions registered with BDL.

“We have also warned against the use of electronic money such as bitcoins in addition to the electronic signature except in specific cases where an agreement is made between the institution and the client to specify the dangers incurred in such an activity,” he said.

Abdul-Hafiz Mansour, the head of the Special Investigation Commission at BDL, said that cybercrimes have remarkably increased in the past few years and millions of dollars were stolen from depositors’ accounts in Lebanese banks.

“The number of hacks increased from 1 in 2011 to 63 today and the amounts of money stolen ranged from $1,500 to $2 million,” he said.

“The biggest problem facing us in cybercrimes is that the hacker is anonymous and the second big problem is that it’s difficult to retrieve the money because it is transferred from one country to several other countries within 24-48 hours,” he said.

Mansour said that the only way to recover the stolen money is by discovering the crime within 24-48 hours maximum. “The client must report to the bank which will, in its turn, contact its correspondent bank to stop the money transfer and return it back to the depositor.”

Maj. Gen. Ibrahim Basbous, director-general of the Internal Security Forces, echoed Salameh’s views on the need for legislations to regulate the Internet sector in addition to a law that specifies ways of fighting against cybercrimes and the applicable punishments for such acts.

He said that the General Directorate of the Internal Security Forces created a department for the fight against cybercrimes while equipping it with very advanced technologies in addition to training its staff.

“We are still working on improving our staff’s skills for them to be up to developments taking place worldwide,” he said.

He added that his department succeeded in coordinating with the state prosecutor’s office for the issuance of circulars aimed at committing providers of Internet services to keep the data that goes into their servers in a bid to facilitate the tracking of Internet criminals.

Other speakers warned that criminals hack and fish the email addresses of bank customers and using them to order transfers from a specific account without the client knowing anything about it.

They added that this constitutes a new pattern of banking crimes that has hugely increased in recent years.

The session’s main aim was to raise awareness among individuals and companies, most of which are unaware of the many hazards that enable cybercrime.

Since 2014 the Special Investigations Commission of Lebanon’s Central Bank has received more than 80 requests of assistance for piracy cases conducted through the Internet.

Antoine Mandour, the deputy assistant director of the SIC, discussed some of these in details.

“A Lebanese bank received an email from a customer, attached to written information holding the customer’s signature to transfer $220,000 to a foreign account abroad under the name of a legal person. There was a suspicion at the bank because the customer had never ordered a similar transaction before and the funds on the account were insufficient,” he said.

He added that this unusual demand triggered the bank’s internal verification procedures.

The client was contacted by phone and denied to have ordered such a transfer. In this case a huge financial loss was avoided by successful internal safeguards.

The SIC’s investigation found that criminals infiltrate email addresses of customers and companies, or change one letter from the original address, to send transfer orders without raising suspicion.

Mandour stressed the importance for banks to have a precise list of their customers’ emails in order to avoid any communication with the nearly identical addresses used by hackers.

He added that “banks should never accept a transfer instruction from a customer’s account without validating the request by phone. Banks as well as customers need to make more efforts and be more cautious in verifying information transmitted by email.”

Summary

Leading bankers called upon the Parliament Thursday to ratify e-commerce and cybercrimes laws for the protection of Internet users in Lebanon, following reports that millions of dollars were stolen by hackers.

Salameh said that cybercrimes are very dangerous because they cannot be controlled within the boundaries of one country which requires serious efforts on the national and international levels.

Banque du Liban Resolution 7548 mentions the minimum of precautionary procedures to be taken by a bank before accepting a transfer order.

Salameh said that despite the lack of proper legislations in Lebanon, the country ranked in seventh place among 10 other countries in UNCTAD’s report about the potential of e-commerce for developing countries. He added that Lebanon witnessed some improvement in the field of e-commerce whereby the Central Bank has secured a proper legislative environment while controlling the cost of such transactions and guaranteeing the protection of clients engaging in electronic banking operations.

Salameh said that the Central Bank has already issued in the past two decades circulars to enhance and improve electronic money transfer operations in addition to transactions done through ATMs.

He added that Circular 69 was issued by the Central Bank in the year 2000 to define electronic financial and banking operations and restrict these transactions to institutions registered with BDL.

Other speakers warned that criminals hack and fish the email addresses of bank customers and using them to order transfers from a specific account without the client knowing anything about it.

 

Dana HalawiPaul Fargues| The Daily Star

The Daily Star

November 13, 2015


Anti-money laundering law key to deposits

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Leading bankers warned Tuesday that the flow of deposits to Lebanon will be gravely affected if the parliament fails to pass crucial bills on anti-money laundering and terrorism financing by the end of this year.

“Lebanon will face severe financial sanctions if it fails to pass these bills by the end of this year and this will definitely impact the flow of deposits to the country, warned Joseph Torbey, chairman of the of World Union of Arab Bankers at the annual conference on anti-money laundering compliance.

 

The conference, which was held at Movenpick Hotel, aims at discussing challenges facing Arab banks in implementing anti-money laundering laws. The event was organized by the Union of Arab Banks in cooperation with the Special Investigation Commission at the Central Bank and the World Union of Arab Bankers.

 

In the past few years, the Central Bank has intensified its campaign against suspected money launderers after Lebanon’s name was removed from the list of noncooperating countries in the fight against dirty money in 2001. But Lebanon still has to make some amendments to the current anti-money laundering and terrorism funding regulations to be in full compliance with international standards.

“Lebanon was removed from the List of countries that are noncompliant with anti-money laundering regulations in 2001 after succeeding in creating compliance departments in its financial institutions which restored trust in its banking system,” Torbey said.

 

He added that the de-risking phenomenon also became widespread in Lebanon and in Arab countries prompting banks to end their business ties with high risk customers.

“The problem with de-risking is that it has resulted in banks losing some of their customers which increased the risk of witnessing more shadow banking activities, he said. “However dealing with high risk customers may on the other hand pose threats to banks’ relations with their correspondent banks,” he added.

In a bid to be fully compliant with international standards, Torbey emphasized the need for cash declaration on the borders when money transfers exceed a specific amount. “This procedure does not impact banking secrecy at all because most of the money is transferred from Africa and Gulf countries, where there exist no obstacles in money movement [as opposed] to the U.S. and EU countries,” he said.

Also, Torbey added that this procedure does not aim to collect taxes because money that is generated by Lebanese outside their country is not subject to taxes.

However, he added, among the newly required amendments is tax exchange information agreement for money generated inside Lebanon. “The absence of tax exchange information was not considered part of organized crimes but then it was included in pacts signed by the U.S. and the EU and it is a must now,” he said.

“The tax administration in Lebanon did not have the right to declare tax evasion cases but this should be required after the Parliament passes the tax exchange information agreement,” he added.

 

Torbey said that law 318/2001 related to fighting terrorism should be amended to include crimes that are newly listed internationally.

Moreover, he said that Parliament must approve the 1999 U.N. treaty designed to criminalize acts of financing terrorism. The convention also seeks to promote policy and judicial co-operation to prevent, investigate and punish the financing of such acts.

 

His views were echoed by Abdul Hafiz Mansour, secretary-general of the Special Investigation Commission who emphasized the need to take part in the 1999 U.N. treaty, which, he said, is capable of solving two-thirds of the problems currently facing Lebanon.

“We really hope that Parliament approves Lebanon’s participation in the 1999 U.N. treaty,” he said.

 

Mansour noted that 95 percent of member countries in the U.N. approved on this treaty and Lebanon and Somalia are the only two Arab countries that are not part of it yet.

“But Somalia has made headway to approve the treaty [as opposed to Lebanon,” he said.

 

Mansour said that it is in the interests of the country to fight acts of financing terrorism because they contribute to increasing inflation in addition to weakening public finances due to tax evasion.

He also spoke of the threat emanating from the increase in cybercrime and most specifically stealing from people’s bank accounts.

“This has increased at a remarkable pace and the problem with these kinds of crimes is that it’s difficult to track stolen money because they move from one country to several other countries within 24 hours,” he said.

 

Mansour said these crimes have also increased in Lebanon, whereby the number of hacks increased from just one in 2011 to 63 over the past few months.

 

Mohamed Abou Moussa, executive director at the Egyptian Money Laundering and Terrorist Financing Combating Unit at the central bank of Egypt, repeated

 

Mansour’s remarks by saying that advanced technology contributed to the increase in crimes.

 

He gave a presentation on the threats imposed by new payment methods, such as postpaid cards and crowd funding, on fighting anti-money laundering and terrorism funding.

 

He said that postpaid cards do not allow for identifying their users and are mainly in countries that do not have strong regulations for anti-money laundering and terrorism funding.

 

He added that some terrorist organizations resort to crowd funding disguised as charity groups to solicit money in a bid to commit their crimes

 

Dana Halawi

The Daily Star

November 11, 2015


No time to cry wolf

The alpha hounds of Lebanon’s banking sector still perform as needed in H1 2015

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In the Lebanese banking sector’s cherished game of claiming the deposit throne, month-on-month drops of private sector deposits are usually reserved for the January statistics, in what has become known as the annual correction of window dressing at the end of the business year. That is why, when the relevant central bank data is pulled up as a line graph, January 2011, January 2014, and January 2015 look like little potholes on a long, ever ascending highway to a heaven of private sector deposits.

Besides the January corrections, deposit dips in the past five years have been few and far between, such as February 2011, July 2012 and April 2013. None of downward moves lasted more than a month and none amounted to more than a few decimals in the sector’s deposit tally of billions of dollars. This fact alone was enough to make alarm signals sound in the news, that July was another of those months with a minute contraction in private sector deposits appears unseemly; namely a 0.2 percent fall from $148.58 billion in June to $148.39 billion in July according to Banque du Liban data released in mid-September.

In numbers based on central bank reporting, total private and public deposits at all commercial banks rose by $4.26 billion from $143.4 billion at the end of June 2014 to $147.6 billion at the end of last year and by another $4.15 billion to $151.8 billion at the end of June before receding to $151.5 billion in July. Total deposits are generally a few billion dollars higher than total private sector deposits. But looking at either data stream, the growth rate in H1 2015 has clearly slowed percentage wise when compared with six-month periods in recent years. However, this observation itself cannot be a precursor of the sky being about to crash down.

The picture of our banking activity also remains within bounds of normality when reviewing the performance of top banks in the first half of 2015. Market leader Bank Audi recorded very minor growth of assets and deposits. Both its domestic and foreign assets expanded by less than 1 percent in the first half of 2015. Domestic assets denominated in USD saw the largest increase, at 2 percent year to date. Loans in the bank’s foreign operations contracted when expressed in USD, domestic loans in the Lebanese Pound expanded by over 5.6 percent in the year to date but this increase could not keep the consolidated lending growth in the black; the overall loan portfolio shrank by 0.8 percent.

Growth and profit

At BLOM Bank, the growth rates looked stronger but not decidedly stronger. Assets edged up by 2.3 percent, deposits by 3.1 percent and loans by 1.6 percent. Domestic growth surpassed growth of BLOM’s foreign entities in all three categories, by about one percentage point in loans, two percentage points in assets and almost three percentage points in deposits. While Audi and BLOM’s combined market share of total deposits dropped by about 30 basis points when compared with mid-2014, combined, their position remained dominant with a 37 percent control of alpha group deposits.

Revenue stream components at the two largest banks showed an up-shifting of net interest income while trading and investment income and non-interest income declined. According to FFA Equity Research the year-on-year improvements in net interest income for H1 2015 were 8 percent at BLOM and 16.5 percent at Audi. Both banks improved their fees and commissions income; however, these gains were juxtaposed with year-on-year drops in trading and investment income of 43.1 percent at BLOM and 18.3 percent at Audi that contributed to the two banks’ contraction of non-interest incomes by 16.5 percent (BLOM) and 4.4 percent (Audi).

The first-half net profits of the two top banks amounted to $202.1 million for Audi and $190.4 for BLOM, followed by $70.1 million at Byblos Bank, the third largest Lebanese bank by assets and deposits. Year on year, Audi achieved a 6.5 percent profit increase, BLOM 6.2 percent. For Byblos Bank, the increase was 1.1 percent. The latter bank’s first-half performance, which was a mix of net interest income versus non-interest income, underwent a rather different development to that of Audi and BLOM. Byblos Bank’s fees and commissions income dropped 10.4 percent year on year, its trading and investment income, however, jumped 24.7 percent higher. Byblos Bank achieved improvements of 8.8 percent in net interest income and 8.7 percent in non-interest income.alpha-banking-ranks

Growth of deposits in different pockets, lending activity subdued across the ranks

The report card on profits is also coherent for the entire stratum of the 14 largest Lebanese lenders. Banking intelligence company BankData reported in early September that the combined net profits of banks in the alpha group, comprising banks with deposits above $2 billion, increased by 9 percent for the first half in 2015 when compared with end June 2014. Total alpha group profits for H1 2015 tallied at $993 million according to BankData, with the top five banks by profits – Audi, Blom, Bank of Beirut, Fransabank and SGBL – accounting for $648 million, or 65 percent of the total.

The three banks with the strongest first-half deposit growth rates were Lebanon and Gulf Bank (LGB) with 7 percent, followed at some distance by Credit Libanais and BBAC, each showing growth in the mid four percent range. The three banks together represent about 9.5 percent of alpha group deposits. While Credit Libanais and BBAC each reported growth of domestic deposits that was above 5 percent in conjunction with drops in deposits in entities abroad, LGB derived its growth more from units abroad than from domestic operations, showing year-to-date deposit growth rates of 22.5 percent from entities outside of Lebanon and 6.9 percent within the country. Of the two banks that experienced negative year-to-date growth of deposits, First National Bank (-1.7 percent) and Banque Libano-Francaise (-0.4 percent), FNB saw outflows from foreign currency accounts in the domestic market while BLF achieved a small gain in domestic deposits and reported lower deposits in foreign entities. FNB’s and BLF’s combined market share in alpha group deposits is 7.7 percent.

The strongest loan growth was represented by CreditBank at 7.7 percent, followed by BBAC at 5 percent. On the balance, however, the overall evolution of the alpha group’s loan portfolio was unsettlingly flat for the first half in 2015, at 0.1 percent growth. Six of the 14 alpha group banks showed year-to-date drops in the loan portfolios, with contractions going up to 5 percent. The lending growth that occurred was, with a few exceptions such as CreditBank, concentrated on Lebanese Lira-denominated loans while the alpha group’s portfolio of foreign currency-denominated loans regressed mildly.

In short, developments of assets, deposits, and loans since the start of 2015 have varied in the customary fashion from bank to bank and often differed notably between H1 2015 and H2 2014, and also within individual institutions.

The most striking commonality in the sector’s performance numbers is related to deposit growth when comparing year-to-date growth in the first six months in 2015 with the year-on-year growth between end June 2014 and end June 2015. With the single exception of BLF, whose small contraction of deposits was wider year on year than in the year to date, all banks in the alpha group by end of June 2015 had seen significantly stronger deposit growth rates in the past twelve months than in the past six months. More specifically, for the bottom half of the alpha group banks, the growth percentage of the 12-month period was three times or more what they had achieved in the first half of 2015. On average across the alpha group, the year-to-date deposits growth rate was 2.2 percent as opposed to 6.9 percent year on year.

Deposit doubt

This slowing in the ability to attract deposits is the hidden, or not so hidden, worry that lurks beneath the floorboards of the Lebanese economy. Consistent and significant growth in deposits is needed to sustain the financing of the public sector deficit and of the private sector. This growth necessity does not chime all that well with the information in the BankData report for H1 2015 that “deposits rose by 2.2 percent over the first half of 2015, with domestic deposits growing by 3.0 percent while foreign deposits decreased by 1.4 percent over the period. Out of domestic deposits, [LBP] deposits grew by 4.6 percent while foreign currency deposits increased by 2.1 percent.”

While it is certainly worth keeping in mind that deposit growth in such low percentage ranges could cause the Lebanese economy serious pains after few short years, the detailed numbers for the first half of 2015 and the headline numbers for July present a nuanced picture of banking sector performance, showing a reality that does not lend itself to broad-brush predictions of doom.

Expectations voiced by BDL Governor Riad Salameh in the September monthly meeting between the central bank and the Association of Banks in Lebanon are that banks will achieve 6 percent growth in deposits and 5 percent growth in lending this year according to a brief report in Byblos Bank’s Lebanon This Week (LTW) publication for the third week of September. According to LTW, Salameh also affirmed the stability of the currency regime and the sufficiency of market liquidity in Lebanon and told bankers that BDL will continue to issue its financial stimulus package in a 2016 edition. (Minutes of the meeting or even a summary were not offered online by ABL or BDL as neither organization appears to have yet put on the mantle of transparency when it comes to keeping the business community in the loop about these important conversations).

For the moment, the analysis of year-to-date sector data and the presence of central bank assurances suggest that now is not the time to cry wolf over any new, vicious imbalance in our banking sector. Lebanese bankers will also act at their own peril if they ignore recent warning flashes of downward adjustments in 2015’s GDP and the change in the ratings outlook from stable to negative. It is indubitable that the banking business, along with the entire country, is in for new challenges and one cannot shout loud enough to alert all “concerned parties” that the political paralysis of the state must be overcome constructively.

A Federal winter is coming

Finally, it is an inescapable insight that, today, global scenarios are just as obscure as the domestic outlook. The past weeks of Federal Reserve soul-searching over interest rate decisions have affirmed the understanding that hiking of the federal funds rate in the United States has certain implications of uncertain direction and magnitude outside the US. This was reflected clearly in references to “developments abroad” and “international developments” in the Federal Open Market Committee’s September 17 statement on the decision to maintain the current rate a little while longer. The potential for a growing dichotomy between US and global interests was immediately highlighted by divergent responses from market participants after the recent Fed announcement and the need to calm moods with a speech by Fed Chair Janet Yellen on September 24 to reassure her compatriots that the return to “normal” levels of the federal funds rate is likely to be initiated before the end of this year.

If anything is more certain than that the Fed’s decisions will impact markets and economies all over the world, it is that these impacts will bring many surprises and give analysts years of work opportunities to formulate hindsight explanations why such events were logical. A safe assumption for any Lebanese observer is therefore that our bankers will have to be at their nimblest, smartest, and most responsible in order to preserve health and growth of their institutions in this emerging global financial environment.

Thomas Schellen

Executive Magazine

November 9, 2015

 


EU provides $27.5 million in aid to Lebanon

The European Union (EU) has adopted the 2015 second assistance package for Lebanon totaling €25 million ($27.5 million).

The aid consists of three programs. The first is valued at €15 million ($16.5 million) and aims at supporting private sector development by assisting micro, small and medium-sized enterprises to be more competitive.

The second is valued at €5 million ($5.5 million) and consists of providing technical assistance to the Government. The assistance will help improve governance and strengthen the capacities for administrative and institutional reform within the Lebanese public administration, an EU statement said.

The third program is entitled ‘Civil society partnership to promote reform and local development’ and is valued at €5 million’ ($5 million). According to the EU, the funding will help civil society support reforms and increase public accountability in the fields of health, education and environment (including water and energy). Moreover, it will support grassroots organizations to allow their engagement in local socio-economic development.

The programs implement the priorities set out for EU cooperation with Lebanon for 2014-2016.

Reported by Leila Rahbani
Business News9
November 9, 2015


News in Detail

If several languages coalesce, the grammar of the resulting language is more simple and regular than that of the individual languages. The new common language will be more simple and regular than the existing European languages. It will be as simple as Occidental; in fact, it will be Occidental. To an English person, it will seem like simplified English, as a skeptical Cambridge friend of mine told me what Occidental is. The European languages are members of the same family. Their separate existence is a myth. For science, music, sport, etc, Europe uses the same vocabulary. The languages only differ in their grammar, their pronunciation and their most common words. Everyone realizes why a new common language would be desirable: one could refuse to pay expensive translators.

 


BCCL News

The BCCL’s function is to supervise banks, financial institutions, money dealers

To take a trivial example, which of us ever undertakes laborious physical exercise, except to obtain some advantage from it? But who has any right to find fault with a man who chooses to enjoy a pleasure that has no annoying consequences, or one who avoids a pain that produces no resultant pleasure? On the other hand, we denounce with righteous indignation and dislike men who are so beguiled and demoralized by the charms of pleasure of the moment, so blinded by desire, that they cannot foresee

Content Type: Press,Press Releases