The Lebanese Economy witnessed in 2016 another difficult year, registering only an estimated 2% GDP growth, which is better than most years in the Cycle that started 5 years ago and was characterized by slow economic growth. As such, we can only be confident about the future with the boost in Confidence that started in the last quarter of 2016 thanks to the successful Presidential Elections, the formation of a new Government, the new Electoral Law, and the new Term of Governor Riad Salameh at the Head of the Central Bank.

During 2016, monetary conditions remained favorable and continued to prove their resilience, with BDL foreign currency reserves (excluding gold) reaching a new historic level of USD 40.7 billion in December 2016, with the Foreign Exchange market seeing stability on the Lebanese pound over the year. Hence, the ratio of foreign currency reserves to local currency money supply reached 74% in December 2016 (and 94% when accounting Gold reserves) showing the Central Bank’s ability to defend the local currency.

In these challenging economic conditions, the Banking Sector realized a satisfactory performance in 2016, as evidenced by the commercial banks’ balance-sheet increasing by 9.9% to reach USD 204 billion in December 2016 and total deposits of the sector increasing by USD 11 billion in 2016 to reach USD 162 billion.

In parallel, the Banks’ lending activity to the private sector continued in its growth momentum recording a USD 3 billion increase during the year to reach USD 57 billion in December 2016. This growth was driven by the stimulus extended by BDL, which consisted of incentives to commercial banks to support several productive economic sectors that lead to a growth in LBP denominated loans of USD 2 billion.

In this context, IBL Bank, that is ranked amongst the top 10 banks in Lebanon in terms of total assets according to Bankdata, registered a strong year 2016 over-performing the sector in most Key Performance Indicators, while continuing in its conservative strategy and strong risk management practices, as evidenced by IBL Bank’s total assets growing by 20% in 2016, fueled by the increase in the Bank’s total deposits by 10.5% in 2016 while the Bank’s shareholders’ Equity increased also by 20% during the year.

The strong growth in Shareholders’ Equity is imputed to two main drivers. First the solid and sustainable capacity of IBL Bank in internal capital growth thanks to healthy and steady increase of net profits over the years; and second to the issuance of IBL Bank’s series 3 preferred shares amounting to USD 75 million during the year 2016.

In addition, it is important to note that thanks to its conservative approach the Bank enjoys a strong liquidity as evidenced by IBL Bank registering the second highest net primary liquidity to deposits ratio in the alpha group according to Bankdata.

As a consequence of the Bank’s strategic directions, IBL Bank realized an 18% growth in Net Income during 2016, leading to the Bank enjoying the highest Return on Average Equity (ROAE) and the second highest Return on Average Assets (ROAA) in the Lebanese Banking sector according to Bankdata.

Finally, following to the Bank’s healthy risk management framework, and the strong capitalization mainly constituted of core Tier 1 capital, IBL Bank is as at December 2016 fully compliant with the Basel 3 accord and more so with the ratios required in 2018 by the local regulators. In fact, as at December 2016, the Bank’s Common Equity Tier I Capital Ratio was 14.8%, the Tier I Capital Ratio was 17.6%, and the Total Capital Ratio was 19.1%

I would like to close by grabbing this opportunity to thank our customers and correspondent banks for their continuous trust and support as well as the Board of Directors and the entire Group’s staff for their precious insights and efforts to push the Bank towards higher summits