Banking Efficiency in Lebanon: An Empirical Investigation (Report‪)‬

INTRODUCTION The Lebanese banking position is unique in the Middle East with rapid development since the 1990s. During the 2007 financial crisis, the Lebanese banks remained safe and completely unaffected by the crisis; due to Lebanese Reserve Banks' legislations not allowing the banks' executives from investing in high-risk structured products. Moreover, the Lebanese banks have always preserved a comparatively high liquidity in Lebanese Pound (LBP) and in foreign currencies allocated between the domestic and external markets without any concentration in a domestic or a correspondent bank. The liquidity in the sector played a substantial role in safeguarding the banking sector. On the contrary, the financial crisis gave the Lebanese banks a huge push with an increase in deposits by 15.6%, total assets by 14.6%, total loans by 18.64% and net profits by nearly 30% in 2008.