According to BDL statistics, the combined balance sheet of commercial banks operating in Lebanon widened by 4.97% (LBP 18,710 billion) during the first eight months of the current year to LBP 394,807 billion ($261.90 billion), up from LBP 376,097 billion ($249.48 billion) in December 2018. On an annual basis, the combined assets of the resident banking sector came in 9.83% higher than the LBP 359,473 billion ($238.46 billion) reading reported at end of August of last year.

On the funding side of the balance sheet, customer deposits fell by 0.72% (LBP 1,935 billion) YTD August 2019 to LBP 267,239 billion ($177.27 billion), down from LBP 269,173 billion ($178.56 billion) in December 2018. Said contraction came as a result of the 0.76% (LBP 1,566 billion) drop in the deposits of the resident private sector to LBP 204,293 billion ($135.52 billion), accompanied by a 1.86% (LBP 1,059 billion) decrease in the deposits of the non-resident private sector to LBP 55,811 billion ($37.02 billion), which were, however, met by a 10.71% (LBP 690 billion) hike in public sector deposits to LBP 7,135 billion ($4.73 billion). From a currency denomination standpoint, deposits in Lebanese Pounds receded by 4.43% (LBP 3,703 billion) during the first eight months of this year to LBP 79,939 billion ($53.03 billion), while foreign currency deposits rose by 0.95% (LBP 1,768 billion) to LBP 187,300 billion ($124.25 billion). In this context, the deposit dollarization rate increased to 72.01% by end of August, from 70.62% at end of 2018 and 68.80% in August of the previous year. On an annual basis, customer deposits narrowed by 0.14% from LBP 267,621 billion ($177.53 billion) in August 2018.

On the lending front, loans to the private sector (residents and non-residents) plunged by 7.11% (LBP 6,369 billion) during the first eight months of 2019 to LBP 83,155 billion ($55.16 billion), down from LBP 89,524 billion ($59.39 billion) in December 2018. The loans portfolio also sank by 7.14% on an annual basis, resulting in a ratio of net loans to customer deposits of 31.12%, compared to 33.26% at end of 2018 and 33.46% in August 2018. More specifically, the ratio of LBP-denominated private sector loans to LBP deposits stood at 31.26% by end of August 2019, in comparison with 32.95% at year-end 2018 and 33.16% in August of last year. Similarly, the ratio of foreign currency-denominated private sector loans to foreign currency deposits fell to 31.05%, from 33.40% in December 2018 and 33.61% at end of August 2018.

The consolidated capital accounts of commercial banks operating in Lebanon rose to just over LBP 31,234 billion ($20.72 billion) at end of August 2019, compared to LBP 30,382 billion ($20.15 billion) at end of 2018 and LBP 30,246 billion ($20.06 billion) at end of August 2018. This can be explained by banks’ continuous reinforcement of their capital base in order to meet BDL’s solvency requirement thresholds.