International investment bank HSBC said that Lebanon’s financial solidity remained intact despite the deepening conflict in Syria. Yet, the bank does not rule out the threat to Lebanon’s economic stability due to the Syrian conflict.
It added that the series of sporadic security incidents that occurred in the local arena underscore the strain that the Syrian crisis is imposing on Lebanon. “Despite such events, Lebanon’s banking sector retains a remarkably high tolerance of political risk, supported by large-scale inflows from expatriate Lebanese, which do not appear to have been downsized,” HSBC said, adding that Lebanon has been able to keep its currency stable, increase FX reserves (to $30 billion, or 17 months of import cover, in June 2012) and maintain a positive growth of loans to the private sector.
It also issued $785 million worth of 10-year local currency debt in September 2012, at a coupon of 8.24 percent.
The Daily Star
3 October
