BEIRUT (AP) – Banks from four Arab countries are interested in investing in Lebanon’s struggling banking sector, which was hard-hit by the small nation’s three-year economic meltdown, a top Arab banker said yesterday.
Lebanon is in the throes of its worst economic crisis in its short and troubled history that has skyrocketed poverty and inflation, and crippled its bloated public sector and infrastructure.
Secretary General of the Union of Arab Banks Wissam Fattouh, spoke to The Associated Press on the sidelines of the biggest regional banking conference held in Beirut since the historic economic crisis began in October 2019.
Caretaker Economy Minister Amin Salam and Lebanese and regional banking officials called on their Arab counterparts to invest in the crisis-hit country and help revitalise its battered economy.
Fattouh told Saudi-owned TV station Al-Hadath in July that Jordanian and Iraqi banks have expressed an interest to buy small Lebanese banks.
“During our numerous visits to Arab countries and visits with banking leadership, we discussed the possibilities of owning and possessing some Lebanese banks that have the intention to sell,” Fattouh told the AP. He did not name the banks interested in investing in Lebanon.
As of 2022, some 61 banks operate in the tiny Mediterranean country, of which 46 are commercial banks. Many have downsized due to the crisis.
The World Bank said Lebanon’s financial crisis is among the worst worldwide since the mid-19th Century – a culmination of decades of financial mismanagement, corruption, and nefarious policy.
The International Monetary Fund and the Lebanese government reached a tentative agreement in April 2022, which called for an “externally assisted bank-by-bank evaluation for the 14 largest banks”. The audit never happened, as Lebanon’s ruling political parties and officials, many of whom are shareholders or owners in the banks, refused to implement any reforms.
The country has been without a president since October and its Central Bank governor stepped down on Monday.
