BEIRUT: Blom Bank, one of the top two banks in Lebanon, expected its 2010 results to be a "major improvement" as the country’s economy improves and said it was looking to expand in the Middle East.
The strong growth in the Lebanese economy and in retail and corporate loans was driving the bank’s growth in profits said Saad Azhari, its chairman and general manager, at the Reuters Middle East Investment summit.
Lebanese banks have been very profitable over the last two years, emerging relatively unscathed from the financial crisis due to conservative policies by the central bank, which prohibited exposure to risky instruments.
Because of Lebanon’s turbulent history since the 1975-90 civil war, banks have generally adopted more conservative policies than their Gulf counterparts, keeping higher levels of liquidity.
Azhari said the bank’s first half results had already shown "a double-digit increase" in assets, deposits and profits.
"In 2010 there is definitely a major improvement over 2009 for the major reason that the (Lebanese) economy is continuing to grow," Azhari said.
"We are witnessing very strong growth in loans, both retail and corporate loans, not only in Blom but the banking sector in general," he said, adding consumer spending was driving growth in car and house loans.
The bank’s net profit last year grew 16.5 percent to $293.2 million and its first half net profit rose 13.1 percent compared to the same period last year to $156 million. In April, Moody’s lifted the bank’s long-term foreign currency deposit ratings to B1 from B2.
Azhari also said his bank, which is present in 12 countries across the Middle East and Europe, had expanded its branches in Lebanon, Syria and Jordan and was looking to establish a presence in other Middle Eastern countries.
"In the Middle East wherever we are, we are strengthening and we are looking when opportunities arise to grow in other markets," Azhari said. "We are not looking outside the Arab world."
The bank opened four more branches in Syria in the last few months to bring the total number to 27. In Lebanon, three branches were opened in the last few months and seven more are planned over the next nine months. Azhari said the bank would add two more branches in Jordan in the next six months.
