weekly market watch economic research unit · 2016-04-02 · the world travel & tourism council...

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AdliehBeirut,[email protected]

CREDIT LIBANAIS S.A.L.

WeeklyMarketWatch

IssueNo.495

March29th‐April1st2016

LLEEBBAANNOONN NEWS

ECONOMIC INSIGHTS

> Lebanon Ranks 30th in the World in Travel & Tourism’s Contribution to GDP 1

> Lebanon Emerged as the Most Expensive Destination for Receiving Remittances from Germany 2

> 34 Office Projects Under Construction in Beirut 3 > Industrial Exports Drop by 6.16% in 2015 to $2,955.8 Million 4 > Opened Letters of Credits Shed 23.85% Y-O-Y in January 2016 5 > The Net Foreign Assets of the Lebanese Financial Sector Start

the Year 2016 with a Deficit of $718.9 Million 6 > Weighted Average Interest Rate on LBP Deposits at 5.52% in

January 2016 6 > Consolidated assets of Financial Institutions Down at $1.61

Billion In January 2016 7 > Cement Deliveries Down by 8.59% in 2015 8 > Lebanon’s Coincident Indicator up by 3.52% Y-O-Y in January

2016 8 > Reserves at BDL Reach $47.97 Billion at End of Q1-2016 9 > BSE Value Traded Increases by 21.62% Y-O-Y in Q1-2016 10

CORPORATE NEWS

> Byblos Bank to Distribute Dividends to Shareholders 11 MONETARY PERFORMANCE

> Monetary Aggregates 12 > Money Markets 12 LEBANESE EQUITIES

> Lebanese Equities & Credit Libanais Indices 13

Lebanon's Economic & Financial Sector Indicators 15 Lebanon's Ratings 16

LEBANON RANKS 30TH IN THE WORLD IN TRAVEL & TOURISM’S CONTRIBUTION TO GDP

The World Travel & Tourism Council ranked Lebanon 30th in the world in terms of the Travel and Tourism sector’s total contribution to GDP, which stood at 22.1% (around $9.9 billion) in the year 2015. LEBANON EMERGED AS THE MOST EXPENSIVE DESTINATION FOR RECEIVING REMITTANCES FROM GERMANY

According to the World Bank, the cost of sending $200 from Germany to Lebanon attained $26.18 in the first quarter of 2016, qualifying the Germany-Lebanon corridor to be the most expensive among all money corridors emanating from Germany. 34 OFFICE PROJECTS UNDER CONSTRUCTION IN BEIRUT

The number of office buildings currently under construction in Municipal Beirut stood at 34 in March 2016 spanning over a total area of 194,863 sqm as per the most recent survey conducted by RAMCO. INDUSTRIAL EXPORTS DROP BY 6.16% IN 2015 TO $2,955.8 MILLION

Lebanon’s industrial exports came in 6.16% lower in the year 2015 at $2.96 billion compared to $3.15 billion in the year 2014. OPENED LETTERS OF CREDITS SHED 23.85% Y-O-Y IN JANUARY 2016

Opened letters of credits (L/Cs) fell by 23.85% on an annual basis to $467.66 million in January 2016, down from $614.13 million in January of last year

TABLE OF CONTENTS

Weekly Market Watch

ECONOMIC RESEARCH UNIT - ADLIEH, BEIRUT LEBANON - TEL: 01-608000 FAX: 01-608231

"BDL" Banque Du Liban "ABL" Association of Banks in Lebanon "MOF" The Lebanese Ministry of

Finance "BOP" Balance of Payment "IMF" The International Monetary Fund "Moody's" Moody's Investors Service "BSE" Beirut Stock Exchange "GDRs" Global Depositary Receipts "M1" Currency in Circulation + Demand

Deposits in LBP "M2" M1 + Other Deposits in LBP "M3" M2 + Deposits in Foreign Currencies "M4" M3+ Treasury Bills Held By Non Banking System, Including Accrued

Interests "CPI" Consumer Price Index "PPI" Producer Price Index "CLASI" Credit Libanais Aggregate Stock Index "CLFI" Credit Libanais Financial Sector Stock Index

"CLCI" Credit Libanais Construction Sector Stock Index “EIU” Economist Intelligence Unit “EOY” End of Year "P/E" Price to Earnings Multiple "P/BV" Price to Book Multiple "YTD" Year To Date "YTD Price Performance" Yield to Date Price Appreciation

"Forex" Foreign Exchange "LBP" The Lebanese Pound "USD" The United States Dollar "Yen" The Japanese Yen "GBP" The British Pound/ Sterling Pound "CHF" The Swiss Franc "Y-O-Y" Year-On-Year "GDP" Gross Domestic Product "MENA" Middle East and North Africa

“LE” Livre Egyptienne – Egyptian Pound

“SAR” Saudi Arabian Riyal “AED” United Arab Emirates Dirham “BD” Bahraini Dinar

SYNOPSIS OF TERMS

Weekly Market Watch

ECONOMIC RESEARCH UNIT - ADLIEH, BEIRUT LEBANON - TEL: 01-608000 FAX: 01-608231

LEBANON NEWS

LEBANON RANKS 30TH IN THE WORLD IN TRAVEL & TOURISM’S CONTRIBUTION TO GDP

The World Travel & Tourism Council (WTTC) recently published its “Travel & Tourism Economic Impact 2016” report in which it assesses the influence of the Travel and Tourism (T&T) sector on the economy by estimating the industry’s contribution to GDP and employment in 184 countries across 24 regions and sub-regions around the globe. On a local basis, the report ranked Lebanon 30th in the world in terms of T&T’s total contribution to GDP, which stood at 22.1% (around $9.9 billion) in the year 2015, surpassing by far the world average of 9.8%. T&T’s direct contribution to Lebanon’s GDP reached 8.1% ($3.6 billion), compared to an average direct share of 3.0% of GDP for the world, positioning Lebanon 31st in the world. On the employment front, the total number of jobs (direct & indirect) in Lebanon’s T&T industry attained 326.8 thousand in 2015, representing 21.3% of the country’s overall job market. Concurrently, the report unveiled that the T&T sector in Lebanon attracted some $1.3 billion in capital investments in 2015, representing a stake of 9.9% of total capital investments in the country. Visitor exports, which represent total spending within the country by international tourists, aggregated to $6.9 billion in 2015, accounting for 51.9% of total spending in Lebanon (rank: 20th), compared to a world average of $7.1 billion (6.1% of total exports). As for the future prospects of the travel and tourism industry, the report projected T&T’s total contribution to Lebanon’s GDP to widen by 5.3% in the year 2016 and an additional 6.8% per annum (p.a.) during the ten-year period extending between the years 2016 and 2026, to reach $19.97 billion by end of 2026. In parallel, the report noted that T&T sector-related jobs in Lebanon (direct & indirect) are likely to expand by 4.4% in 2016 and by an average of 4.0% p.a. over the coming ten years to eventually attain 503.1 thousand jobs by end of 2026. In addition, spending by tourists in Lebanon is estimated to grow by 3.3% in 2016 and by 5.7% p.a. during the 2016-2026 period before nearing the $12.50 billion mark in the year 2026. Investments in the travel & tourism sector in Lebanon are projected to grow by 5.6% in 2016 and by 6.2% p.a. over the next ten years to just above $2.46 billion by end of year 2026.

Weekly Market Watch

SOURCE: WTTC, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 1

Value Rank % Share Rank Average % Share

T&T's Direct Contribution to GDP $3.6 Billion 61 8.1% 31 $18.5 Billion 3.0%T&T's Total Contribution to GDP $9.9 Billion 62 22.1% 30 $55.7 Billion 9.8%T&T's Direct Contribution to Employment 120.9 Thousand Jobs 83 7.9% 32 845.8 Thousand Jobs 3.6%T&T's Total Contribution to Employment 326.8 Thousand Jobs 83 21.3% 30 2,123.0 Thousand Jobs 9.5%T&T Capital Investment $1.3 Billion 61 9.9% 48 $4.3 Billion 4.3%Visitor Exports $6.9 Billion 42 51.9% 20 $7.1 Billion 6.1%

WorldLebanonTravel & Tourism's (T&T) Economic Impact in 2015

Source: WTTC, Credit Libanais Economic Research Unit

0% 10% 20% 30% 40% 50% 60%

T&T's Direct Contribution to GDP

T&T's Total Contribution to GDP

T&T's Direct Contribution to Employment

T&T's Total Contribution to Employment

T&T Capital Investment

Visitor Exports

8.1%

22.1%

7.9%

21.3%

9.9%

51.9%

3.0%

9.8%

3.6%

9.5%

4.3%

6.1%

Key Travel & Tourism Figures in the Year 2015

World Lebanon

Source: WTTC, Credit Libanais Economic Research Unit

LEBANON NEWS

Weekly Market Watch

SOURCE: WORLD BANK, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 2

LEBANON EMERGED AS THE MOST EXPENSIVE DESTINATION FOR RECEIVING REMITTANCES FROM GERMANY

The World Bank Group recently published its latest statistics surrounding remittance prices around the world, in which it assesses the cost of sending and receiving remittances from 35 money sending countries to 99 receiving countries, resulting in 300 “country corridors” worldwide. The cost includes, among other things, transaction fees, the applicable exchange rate, and the speed of the service. According to these statistics, the cost of sending $200 from Germany to Lebanon attained $26.18 in the first quarter of 2016, thus constituting 13.09% of the transferred amount. This qualifies the Germany-Lebanon corridor to be the most expensive among all money corridors emanating from Germany, followed by China ($23.63), Moldova ($21.49), Ghana ($21.32), Vietnam ($21.16), and India ($21.00), only to name a few. It is worth noting that the cost of sending remittances ($200) from Germany to Lebanon stood at $24.22 (12.11%) in the fourth quarter of 2015. Furthermore, the World Bank revealed that the average cost of sending $500 from Germany to Lebanon stood at $36.90 (7.38%) in the first quarter of 2016, in comparison with $35.55 (7.11%) a quarter earlier. In parallel, and when evaluating the cost of sending $200 from the United States to receiving countries around the globe, Lebanon surfaced as the second most expensive destination, standing at $24.60 (12.30%) in Q1-2016, unchanged from the previous quarter, preceded by Kenya ($24.78) and followed by Thailand ($23.21), South Africa ($20.85), and China ($17.16), only to name a few.

From % Total Cost % Total Cost % Total Cost % Total Cost

United States 12.30% $24.60 12.30% $24.60 5.91% $29.55 6.53% $32.66

Germany 12.11% $24.22 13.09% $26.18 7.11% $35.55 7.38% $36.90Source: World Bank, Credit Libanais Economic Research Unit

Cost of Sending Remittances to Lebanon

4th Quarter of 2015 1st Quarter of 2016

$200 $500

4th Quarter of 2015 1st Quarter of 2016

$0 $5 $10 $15 $20 $25

Kenya

Lebanon

Thailand

South Africa

China

Jamaica

Afghanistan

Indonesia

Jordan

Yemen

$24.78

$24.60

$23.21$20.85

$17.16

$16.81

$16.27

$16.16

$15.81

$12.85

The 10 Most Expensive Destinations for Remittances ($200) from the United States as of the First Quarter of 2016

Source: World Bank, Credit Libanais Economic Research Unit

$0 $5 $10 $15 $20 $25 $30

Lebanon

China

Moldova

Ghana

Vietnam

India

Afghanistan

Bosnia & Herzegovina

Serbia

Macedonia

$26.18

$23.63

$21.49

$21.32$21.16

$21.00

$19.06

$17.86

$17.60

$17.18

The 10 Most Expensive Destinations for Remittances ($200) from Germany as of the First Quarter of 2016

Source: World Bank, Credit Libanais Economic Research Unit

LEBANON NEWS

Weekly Market Watch

SOURCE: RAMCO, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 3

34 OFFICE PROJECTS UNDER CONSTRUCTION IN BEIRUT

According to RAMCO, the office real estate sector in Lebanon is starting to feel the pinch of the prevailing economic slowdown which is captured by a drop in office stock under construction in Municipal Beirut coupled with more flexible pricing schemes by some developers. In details, the number of office buildings currently under construction in Municipal Beirut stood at 34 in March 2016 spanning over a total area of 194,863 sqm as per the most recent survey, in comparison with 37 projects under construction over an area of 195,694 sqm a year earlier. The survey also reveals that the average asking price on the first floor in new office towers in Municipal Beirut ranges between $3,500 and $4,000 per sqm. The majority (around 71.38%) of the new office buildings according to the survey was concentrated in the Ashrafieh area which hosted 24 projects over an area of 139,099 sqm implying an average area of 5,796 sqm per project. Elsewhere in Beirut, the western part attracted 6 projects with an average project size of 3,822 sqm followed by the Beirut Central District (BCD) which hosted 4 projects having an average project size of 8,208 sqm. The report identified the Corniche el Nahr, Adlieh, National Museum, and Badaro areas as the most attractive office building spots in the Ashrafieh area, and tipped the Jnah, Ramlet al Baida and Unesco areas to become important business destinations.

BCD Ashrafieh Western Beirut Municipal BeirutNumber of Projects 4 24 6 34Office Area (sqm) 32,831 139,099 22,933 194,863Average Project Size (sqm) 8,208 5,796 3,822 5,731Share Across Beirut 16.85% 71.38% 11.77% 100.00%

Office Projects Under Construction in Municipal Beirut

Source: RAM CO, Credit Libanais Economic Research Unit

LEBANON NEWS

Weekly Market Watch

SOURCE: THE LEBANESE MINISTRY OF INDUSTRY, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 4

INDUSTRIAL EXPORTS DROP BY 6.16% IN 2015 TO $2,955.8 MILLION

According to the Lebanese Ministry of Industry, Lebanon’s industrial exports expanded month-on-month to $231.1 million in December 2015, compared to $219.9 million in November. On an annual basis, however, industrial exports came in 6.16% lower in the year 2015 at $2.96 billion compared to $3.15 billion in the year 2014. More specifically, exports of prepared foodstuffs fell by 6.00% ($31.7 million) annually to $497.2 million, accompanied by a 15.72% ($59.4 million) drop in exports of base metals and articles of base metal to $318.4 million, only to name a few. Concurrently, industrial imports contracted by 12.89% y-o-y to $234.4 million during the year 2015, compared to $269.1 million a year earlier. This contraction can be primarily attributed to the 23.27% decline in imports of industrial equipment from the USA to $11.6 million and the 6.98% drop in imports of industrial equipment from Italy to $52.1 million, among others. Exports of “machinery and mechanical appliances” topped the list of Lebanon’s industrial exports, accounting for 23.20% ($685.7 million) of the total exports’ bill, followed by “chemical products” ($544.5 million <18.42%>) and “prepared foodstuffs” ($497.2 million <16.82%>), only to name a few. On the imports front, Italy led the list of countries exporting to Lebanon ($52.1 million <22.24%>), followed by China ($50.7 million <21.62%>) and Germany ($44.9 million <19.14%>) as elaborated in the section below:

(USD Million) 2014

Industrial Exports 3,149.8

Industrial Imports of Equipment & Machinery 269.1 234.4 -12.89%

2015Evolution of Industrial Activity

2,955.8

Y-O-Y% Change

-6.16%

Source: Lebanese M inistry o f Industry, Credit Libanais Economic Research Unit

2,700

2,800

2,900

3,000

3,100

3,200

3,300

3,400

2013 2014 2015

3,384.3

3,149.8

2,955.8

$ Million

Cumulative Evolution of Industrial Exports

Source: Ministry of Industry, Credit Libanais Economic Research Unit

0

50

100

150

200

250

300

350

2013 2014 2015

300.4

269.1

234.4

$ Million

Cumulative Evolution of Industrial Imports of Equipment & Machinery

Source: Ministry of Industry, Credit Libanais Economic Research Unit

Italy22.24%

China21.62%

Germany19.14%

France5.49%

U.S.A.4.95%

Others26.56%

Breakdown of Imports of Equipment & Machinery by Country of Origin in 2015

Country Value ($ Million)Italy 52.1China 50.7Germany 44.9France 12.9U.S.A. 11.6Others 62.2Total Industrial Imports 234.4

Breakdown of Imports of Equipment & Machinery by Country of Origin in 2015

Source: Lebanese M inistry o f Industry, Credit Libanais Economic Research Unit

Machinery and mechanical appliances23.20%

Chemical Products18.42%Prepared

Foodstuffs16.82%

Base Metals and Articles of Base

Metal10.77%

Paper & paperboard and articles thereof

5.40%

Others25.39%

Breakdown of Industrial Exports in 2015

Product Value ($ Million)Machinery and mechanical appliances 685.7Chemical Products 544.5Prepared Foodstuffs 497.2Base Metals and Articles of Base Metal 318.4Paper & paperboard and articles thereof 159.6Others 750.4Total Industrial Exports 2,955.8Source: Lebanese M inistry o f Industry, Credit Libanais Economic Research Unit

Breakdown of Industrial Exports by Product in 2015

LEBANON NEWS

Weekly Market Watch

SOURCE: BDL, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 5

OPENED LETTERS OF CREDITS SHED 23.85% Y-O-Y IN JANUARY 2016

According to Banque Du Liban statistics, opened letters of credits (L/Cs), a measurement tool for trade activity, fell by 15.72% during the month of January 2016 to $467.66 million, down from $554.89 million in December 2015. On an annual basis, the face value of opened L/Cs came in 23.85% lower when compared to the $614.13 million recorded in January of last year. Documentary L/Cs opened to finance imports activities shed 7.04% y-o-y to $344.88 million in January 2016, from $371.01 million a year earlier. Concurrently, utilized credits for imports slipped to $389.85 million, from $424.68 million in January 2015. In parallel, inward bills for collection, another documentary credit form of financing (backed by invoices), plunged by 38.52% on a yearly basis to $87.89 million, down from $142.95 million in the first month of 2015.

In a related note, documentary L/Cs opened to finance exports activities notched 49.50% lower y-o-y to $122.79 million at end of January 2016, from $243.12 million a year before. Utilized credits to finance exports also fell by 19.92% to $160.27 million (130.52% of opened L/Cs for exports), from $200.13 million in January 2015. Concurrently, outward bills for collection eased by 32.10% annually to $95.26 million, while the value of outstanding outward bills rose by 12.01% to $596.88 million.

-

200

400

600

800

1,000

1,200

Jan-2009 Jan-2010 Jan-2011 Jan-2012 Jan-2013 Jan-2014 Jan-2015 Jan-2016

717.84 784.72

601.07

808.65

1,004.72

777.69

614.13

467.66

$ Million

Evolution of Total Opened L/Cs

Source: BDL, Credit Libanais Economic Research Unit

$ Million Jan-2015 Jan-2016 Y-O-Y % Change

Documentary L/Cs

– Opened Credits 371.01 344.88 -7.04%

– Utilized Credits 424.68 389.85 -8.20%

– Outstanding Credits 894.93 902.95 0.90%

Bills For Collection

– Inward Bills 142.95 87.89 -38.52%

– Outstanding Bills 148.39 129.29 -12.87%Source: BDL, Credit Libanais Economic Research Unit

Documentary Credits for Imports' Financing for the Month of

$ Million Jan-2015 Jan-2016 Y-O-Y % Change

Documentary L/Cs

– Opened Credits 243.12 122.79 -49.50%

– Utilized Credits 200.13 160.27 -19.92%

– Outstanding Credits 1,166.50 788.72 -32.39%

Bills For Collection

– Outward Bills 140.30 95.26 -32.10%

– Outstanding Bills 532.87 596.88 12.01%Source: BDL, Credit Libanais Economic Research Unit

Documentary Credits for Exports' Financing for the Month of

050

100150200250300350400

Jan-2015 Jan-2016

371.01344.88

142.95

87.89

$ Million

Opened Letters of Credits & Inward Bills for Imports' Financing for the Month of

– Opened Credits – Inward Bills

0

50

100

150

200

250

Jan-2015 Jan-2016

243.12

122.79140.30

95.26

$ Million

Opened Letters of Credits & Outward Bills for Exports' Financing for the Month of

– Opened Credits – Outward Bills

LEBANON NEWS

Weekly Market Watch


THE NET FOREIGN ASSETS OF THE LEBANESE FINANCIAL SECTOR START THE YEAR 2016 WITH A DEFICIT OF $718.9 MILLION

The net foreign assets of Lebanon’s financial sector started the year 2016 with a five-year record deficit of $718.9 million, compared to a $280.2 million deficit in January 2015 and a $31.3 million deficit in January 2014. The first month of the year 2016 witnessed a deficit for the sixth consecutive month, compared to deficits of $372.4 million and $816.0 million during December and November of the previous year. This deficit comes as a result of the shy $44.8 million surplus in the net foreign assets of the Lebanese Central Bank, which was completely eroded by the $764.0 million deficit in the net foreign assets of banks & financial institutions. WEIGHTED AVERAGE INTEREST RATE ON LBP DEPOSITS AT 5.52% IN JANUARY 2016

According to BDL statistics, the weighted average interest rate on Lebanese Pound denominated deposits dropped to 5.52% during the month of January 2016, compared to 5.56% in December 2015 and 5.57% in January 2015. However, the weighted average interest rate on U.S. Dollar denominated deposits increased to 3.22% in January 2016, up from 3.17% a month earlier and 3.12% in January 2015. On the other hand, commercial banks’ discount and lending rate on LBP denominated loans shows a significant increase in January 2016 to 8.28% from 7.45% in December 2015 while concurrently expanding to 7.34% on USD denominated loans. This increase is attributed to banks’ compliance with BDL intermediary circular no. 389 which requires them to factor out subsidies and reserve requirements in their computation of lending rates to the private sector.

Net Foreign Assets

In Millions of USD January 2015 January 2016 % Change

Central Bank 357.2 44.8 -87.46%

Banks & Financial Institutions (637.0) (764.0) -19.94%

Total (280.2) (718.9) -156.57%

For the Month of

Source: Banque Du Liban, Credit Libanais Economic Research Unit

-800

-600

-400

-200

0

200

400

Jan-2010 Jan-2011 Jan-2012 Jan-2013 Jan-2014 Jan-2015 Jan-2016

(44.30)

(772.10)

(289.80)

382.50

(31.30)

(280.20)

(718.90)

USD MillionCumulative Balance of Payments


-1000

-800

-600

-400

-200

0

200

(280.2)

(152.6)

(417.4)

136.0 189.2

(794.3)

2.4

(332.0)

(121.8)

(395.5)

(816.0)

(372.4)

(718.9)

Monthly Evolution of the Financial Sector's Net Foreign Assets

2015 2016

USD Million


1.0

6.0

Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16

%

Evolution of USD Lending & Deposits Rates

Spread USD Average Rate on Deposits USD Discount and Loans Rate


0.0

5.0

10.0


%

Evolution of LBP Lending & Deposits Rates

Spread LBP Average Rate on Deposits LBP Discount and Loans Rate


LBP USD LBP USD LBP USD

5.57% 3.12% 5.56% 3.17% 5.52% 3.22%

5.95% 3.57% 5.97% 3.64% 5.88% 3.67%

7.26% 6.96% 7.45% 7.06% 8.28% 7.34%


De c e mbe r 2 0 15Inte re st Ra te Le ve ls

Ja nua ry 2 0 16

Discount & Loans Rate

Average Rate on Deposits

Term Savings & Deposits Rate

Ja nua ry 2 0 15

LEBANON NEWS

Weekly Market Watch


CONSOLIDATED ASSETS OF FINANCIAL INSTITUTIONS DOWN AT $1.61 BILLION IN JANUARY 2016

The consolidated balance sheet of financial institutions operating in Lebanon was down by LBP 161,852 million ($107.36 million) during the month of January 2016 to LBP 2,432.65 billion ($1,613.70 million), from LBP 2,594.50 billion ($1,721.06 million) a month earlier. This comes as a result of the 10.76% ($101.74 million) monthly drop in claims on the private sector to LBP 1,271.91 billion ($843.72 million). Similarly, on an annual basis, the balance sheet of Lebanese financial institutions ended the first month of the year 2016 down by 2.56%, compared to year-on-year growth rates of 15.06% in the first month of 2015 and 16.86% in the first month of 2014. On the lending front, claims on the private sector, which constitute 52.28% of financial institutions’ total assets, added 14.10% y-o-y from LBP 1,114.73 billion ($739.46 million) in January 2015. Claims on the public sector, however, dropped by 59.54% annually to LBP 223.15 billion ($148.03 million) as at end of January 2016, representing 9.17% of the total balance sheet of Lebanese financial institutions. In a related note, the compounded annual growth rate (CAGR) in the balance sheet of Lebanese financial institutions hit the 8.53% mark over the January 2010–2016 period, as sketched in the chart hereunder:

USD Million January 2010

January 2011

January 2012

January 2013

January 2014

January 2015

January 2016

Y-O-Y % Change

AssetsCash & Banks 333.72 364.92 399.74 474.30 556.95 567.83 622.93 9.70%Claims on the Private Sector 475.22 539.36 557.63 631.98 756.02 739.46 843.72 14.10%Claims on the Public Sector 139.84 101.05 108.14 124.21 124.80 365.90 148.03 -59.54%Other Assets 38.63 19.72 22.81 1.13 1.52 -17.16 -0.99 -94.26%Total Assets 987.41 1,025.04 1,088.32 1,231.63 1,439.29 1,656.02 1,613.70 -2.56%LiabilitiesLiabilities to the Private Sector 198.79 258.73 231.48 232.15 269.20 255.88 334.43 30.69%Liabilities to the Financial Sector 397.72 403.29 465.57 549.96 671.12 857.93 692.28 -19.31%Other Financial Liabilities 10.73 13.00 16.26 18.15 19.80 20.40 27.25 33.59%Capital Accounts 259.34 261.80 318.34 362.70 404.25 443.49 468.91 5.73%Other Liabilties 120.82 88.21 56.68 68.67 74.92 78.33 90.83 15.97%Total Liabilities 987.41 1,025.04 1,088.32 1,231.63 1,439.29 1,656.02 1,613.69 -2.56%

Financial Institutions Consolidated Balance Sheet


0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

January2010

January2011

January2012

January2013

January2014

January2015

January2016

987.41 1,025.04 1,088.321,231.63

1,439.29

1,656.021,613.70

$ Million

Evolution of Financial Institutions' Assets


Cash & Banks & Other Assets

38.54%

Claims on the Private Sector

52.28%

Claims on the Public Sector

9.17%

Breakdown of Financial Institutions Balance Sheet as at January 2016


LEBANON NEWS

Weekly Market Watch


CEMENT DELIVERIES DOWN BY 8.59% IN 2015

Cement deliveries, the coincident indicator of construction activity, fell by 7.04% during the month of December 2015 to 447,724 tons, down from 481,636 tons in November. On a cumulative basis, cement deliveries shed 8.59% in the year 2015 to 5,042,867 tons, from 5,516,827 tons in 2014. Cement deliveries registered a compounded annual growth rate (CAGR) of 2.58% over the 2008 – 2015 period, mirroring the lackluster activity of Lebanon’s construction sector. LEBANON’S COINCIDENT INDICATOR UP BY 3.52% Y-O-Y IN JANUARY 2016

Banque Du Liban’s coincident indicator, which is an indicative measure of the country’s overall economic activity, and which comprises import of petroleum derivatives, electricity production, check clearing activity, cement deliveries, foreign passengers, foreign trade, and the M3 monetary aggregate, fell by 7.58% during the month of January 2016 to 279.4, down from 302.3 in December 2015. On an annual basis, however, the coincident indicator rose by 3.52% when compared to the 269.9 reading recorded in January 2015, portraying as such a moderate improvement in economic activity.

2008 4,219,257

2009 4,897,460

2010 5,226,621

2011 5,549,769

2012 5,308,550

2013 5,830,616

2014 5,516,827

2015 5,042,867

Evolution of Cumulative Cement Deliveries (Tons)


01,000,0002,000,0003,000,0004,000,0005,000,0006,000,000

4,219,2574,897,460

5,226,6215,549,769

5,308,550

5,830,6165,516,827

5,042,867

Yearly Evolution of Cement Deliveries


Tons

240

250

260

270

280

290

300

310


269.9

263.3

279.7

288.2285.0

277.7

264.6266.6

271.5

281.4

293.1

302.3

279.4

Evolution of Lebanon's Coincident Indicator


LEBANON NEWS

Weekly Market Watch


RESERVES AT BDL REACH $47.97 BILLION AT END OF Q1-2016

The Lebanese Central Bank balance sheet conveys some $98.27 million contraction in the foreign assets (foreign currency reserves) portfolio during the second half of March to $36.59 billion as at end of Q1 2016, from $36.69 billion in mid-March. The value of gold reserves at BDL, however, remained almost stable at $11.38 billion. On an annual basis, foreign assets at BDL came in 4.89% lower than the $38.48 billion reading reported at end of Q1 2015. On the other hand, the value of gold reserves appreciated by $0.45 billion (4.10%) year-on-year when compared to the $10.93 billion figure registered at end of March 2015. Overall, total reserves (foreign currency and gold) at BDL shed $1.43 billion annually to $47.97 billion, down from $49.41 billion in that same quarter last year. These reserves cover more than 123 months of debt service, and constitute 430.63% of the principal value of foreign and local currency debt that matures in 2016, and 67.93% & 77.70% of Lebanon’s gross and net public debt on a respective basis:

The Central Bank’s balance sheet widened by $0.27 billion during the second half of March to $94.58 billion on the back of the 1.07% appreciation in BDL’s securities portfolio to $19.70 billion and the 0.67% increase in the value of other assets to $21.36 billion. In this perspective, the share of gold and foreign currency reserves at BDL narrowed to 50.72% of the Central Bank’s total assets as at end of Q1 2016, down from 50.97% as at mid-March of the same year and 55.62% as at end of Q1 of last year.

$ Billion End of March. 2010

End of March. 2011

End of March. 2012

End of March. 2013

End of March. 2014

End of March. 2015

End of March. 2016

Gold 10.23 13.22 15.33 14.76 11.94 10.93 11.38Foreign Assets 30.10 30.41 32.42 35.33 36.30 38.48 36.59Total Reserves 40.33 43.63 47.76 50.09 48.24 49.41 47.97Source: Banque Du Liban, Credit Libanais Economic Research Unit

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

End ofMarch.2010

End ofMarch.2011

End ofMarch.2012

End ofMarch.2013

End ofMarch.2014

End ofMarch.2015

End ofMarch.2016

10.2313.22

15.33 14.7611.94 10.93 11.38

30.10 30.4132.42

35.3336.30 38.48

36.59

Evolution of Total Reserves at Banque Du Liban

Gold Foreign Assets


USD Billion

Total Reserves50.72%

Securities Portfolio20.83%

Loans to Public Sector0.00%

Loans to Local Financial Sector

5.63%

Valuation Adjustment

0.00%

Other Assets22.59%

Fixed Assets0.23%

Breakdown of BDL's Balance Sheet as at End of March 2016


$ Billion End of March 2015 Mid-March 2016 End of March

2016Bi-Weekly

(% change)Y-O-Y

(% change)

Total Reserves 49.41 48.07 47.97 -0.20% -2.90%Securities Portfolio 15.80 19.49 19.70 1.07% 24.66%Loans to Public Sector 0.00 0.00 0.00 - -Loans to Local Financial Sector 4.49 5.33 5.33 -0.02% 18.69%Valuation Adjustment 0.00 0.00 0.00 0.00% 0.00%Other Assets 18.92 21.22 21.36 0.67% 12.93%Fixed Assets 0.23 0.22 0.22 -1.92% -5.25%Total Assets 88.84 94.31 94.58 0.28% 6.46%Currency in Circulation Outside BDL 2.74 3.05 3.11 2.11% 13.51%Financial Sector Deposits 69.31 74.89 75.71 1.09% 9.24%Public Sector Deposits 7.71 5.74 4.98 -13.30% -35.46%Valuation Adjustment 5.07 5.84 5.91 1.23% 16.56%Other Liabilities 0.58 1.26 1.33 5.22% 129.52%Capital Accounts 3.43 3.54 3.54 0.06% 3.22%Total Liabilities 88.84 94.31 94.58 0.28% 6.46%Source: Banque Du Liban, Credit Libanais Economic Research Unit

Total Reserves

as a % of Year 2016 Short Term Debt* 430.63%as a % of Gross Public Debt (1) 67.93%

as a % of Net Public Debt (1) 77.70%In months of Debt Service (2) 123.09

(1) As at End of January 2016(2) Average Monthly Debt Service During the Year 2015 Source: ABL, MOF, Credit Libanais Economic Research Unit

* Due to the unavailability of data on projected interest payments for the year 2016, this figure only includes principal repayments on Eurobond Securities and Treasury Bills

LEBANON NEWS

BSE VALUE TRADED INCREASES BY 21.62% Y-O-Y IN Q1-2016

The Beirut Stock Exchange (BSE) witnessed a major improvement in trading activity during the month of March 2016 fueled by a block trade on BLOM Bank listed shares. More specifically, value traded on the BSE rose by 417.98% to $222.42 million in March, up from $42.94 million in February with volume traded concurrently increasing by 392.05% to 24.42 million shares, from around 4.96 million shares in February. This rally in trading activity owes to a block trade involving some 20.06 million BLOM Bank listed common shares (82.17% of total month transactions) pursuant to the liquidation of AZA Holding Co. and the transfer of the said number of shares to the company’s shareholders. In fact, trades mainly consisted of listed banking stocks which represented 99.04% of the total traded volume in March 2016. The stake of real estate stocks was a thin 0.94% down from 41.05% in February, followed by industry & trading stocks at a very shy 0.01% of total traded volume. As far as market capitalization is concerned, the latter increased month-on-month by $244 million to $11.34 billion, yet trailed behind last year’s reading of $11.94 billion. On a cumulative basis, traded volume on the BSE dropped by 2.77% y-o-y to 33.86 million shares during the first quarter of 2016, while value traded headed north gaining some 21.62% annually to $303.85 million. As far as trading multiples are concerned, the weighted average Price to Earning (P/E) and Price to Book Value (P/BV) metrics of stocks listed on the BSE ended the month of March higher at 7.25x and 0.89x on a respective basis compared to 7.12x and 0.87x in February fueled by the increase in market capitalization.

Trading activity remained at subdued levels as portrayed by the low turnover ratio (being the number of shares traded divided by total listed shares) of 1.40% in March and 1.94% in the first quarter of the current year.

Weekly Market Watch

SOURCE: BSE, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 10

Real Estate Sector, 0.94%

Banking Sector, 99.04%

Industry & Trading Sector, 0.01%

Allocation of Traded Volume in March2016

Real Estate Sector1.02%

Banking Sector98.96%

Industry & Trading Sector

0.02%

Allocation of Traded Value in March 2016

249,834

303,848

34,820 33,857

11,940

11,336

11,00011,10011,20011,30011,40011,50011,60011,70011,80011,90012,000

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Q1 2015 Q1 2016

Beirut Bourse Cumulative Trading Activity

Traded Value ($ 000) Traded Volume (000)

Market Capitalization ($ Million)

Analysis of the BSE Activity

Feb 2016 Mar 2016 Monthly % Change Q1 2015 Q1 2016 Y-O-Y %

ChangeTraded Value ($ 000) 42,939 222,417 417.98% 249,834 303,848 21.62%Traded Volume (000) 4,962 24,417 392.05% 34,820 33,857 -2.77%Market Capitalization ($ Million) 11,093 11,336 2.20% 11,940 11,336 -5.06%Traded Value/Market Capitalization 0.39% 1.96% 2.09% 2.68%Turnover Ratio 0.28% 1.40% 1.99% 1.94%Source: BSE, Credit Libanais Economic Research Unit

For the Quarter EndedFor the Month of

BYBLOS BANK TO DISTRIBUTE DIVIDENDS TO SHAREHOLDERS

According to an announcement issued by Byblos Bank S.A.L. and circulated by the Beirut Stock Exchange on March 31, 2016, the Bank’s Board of Directors decided during its meeting held on March 23, 2016 to propose to the Ordinary General Assembly, which will convene on April 26, to distribute dividends to shareholders on the following basis: LBP 200 per common share subject to a 5% withholding tax; $8 per Preferred Share Class 2008 subject to a 5% withholding tax; $8 per Preferred Share Class 2009 subject to a 5% withholding tax; LBP 200 (paid in U.S. Dollars) per global depository receipt (GDR) subject to a 5% withholding tax and

other fees. The payment date for holders of common and preferred shares is scheduled for the 2nd of May 2016, while that for GDR holders is fixed for May 5, 2016.

CORPORATE NEWS

Weekly Market Watch

SOURCE: BSE, BYBLOS BANK, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 11

MONETARY AGGREGATES

The overall money supply, “M4”, widened by LBP 242.60 billion during the week of March 17, 2016 to LBP 198,036 billion despite the LBP 199 billion drop in the non-banking sector’s treasury bills portfolio. On the other hand, Lebanese-pound denominated deposits and currency in circulation, “M1”, shed LBP 125.32 billion week-on-week to LBP 8,366 billion, and this on the back of the LBP 122 billion contraction in money in circulation coupled with a LBP 3 billion slump in demand deposits. Local currency term deposits, “M2”, dropped by LBP 102.98 billion on a weekly basis, yet registered a 6.95% year-on-year increase to LBP 78,483 billion. Consequently, private sector term and saving deposits denominated in LBP (“M2- M1”) edged slightly higher to LBP 70,117 billion, with deposits denominated in foreign currencies (“M3–M2”) firming at LBP 108,462 billion. MONEY MARKETS

The March 24th Treasury bill auction raised some LBP 653.73 billion ($433.65 million), compared to LBP 696.91 billion ($462.45 million) in the auction of the previous week.

Subscriptions were majority (68.89%) concentrated in the newly introduced fifteen-year to maturity T-bonds, followed by the three-year (28.55%) tenure bills and the six-months bills (2.56%).

Consequently, the weighted average yield on Lebanese Pound Treasury bills reached 7.43% in the auction of March 24. The yields on the six-month, three-year and fifteen-year to maturity treasury securities remained flat at 4.99%, 6.50% and 7.90% respectively.

MONETARY PERFORMANCE

Weekly Market Watch

SOURCE: BDL, REUTERS, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 12

Mone y Supply

LBP billion

M1 8 ,4 9 1 8 ,3 6 6 - 1.4 8 %

M2 7 8 ,5 8 6 7 8 ,4 8 3 - 0 .13 %

M3 18 6 ,5 0 3 18 6 ,9 4 5 0 .2 4 %

M4 19 7 ,7 9 4 19 8 ,0 3 6 0 .12 %

M2 - M1 7 0 ,0 9 5 7 0 ,117 0 .0 3 %

M3 - M2 10 7 ,9 17 10 8 ,4 6 2 0 .5 1%Source: Banque Du Liban, Credit Libanais Economic Research Unit

Ma rc h 10 , 2 0 16 Ma rc h 17 , 2 0 16 % Cha nge

6,000

26,000

46,000

66,000

86,000

March 10,2016

March 17,2016

197,794 198,036186,503 186,945

Money Supply - LBP Billion -

M4 M3


Lebanese Treasury Bills

Yield (%) Face Value (in billions

of LBP)

% of Total Face Value

6 Months 4.99% 16.730 2.56%36 Months 6.50% 186.636 28.55%180 Months 7.90% 450.359 68.89% Total 653.725 100.00%Source: Reuters, Credit Libanais Economic Research Unit

March 24, 2016

Lebanese Treasury Bills 3 Months 6 Months 12 Months 24 Months 36 Months 60 Months 84 Months 120 Months 180 MonthsTreasury Yield 4.44% 4.99% 5.35% 5.84% 6.50% 6.74% 7.08% 7.46% 7.90%

3 Months

6 Months

12 Months

24 Months

36 Months

60 Months

84 Months

120 Months

180 Months

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

9.00%

0 1 2 3 4 5 6 7 8 9 10

On The Run Yield Curve

LEBANESE EQUITIES

Activity on the Beirut Bourse remained somewhat muted for the second consecutive week, with volume traded plunging to 316,897 shares this week, down from 631,835 shares last week. Value traded also sank to just below $2.41 million, from $5.81 million a week before. The contribution of banking sector stocks to total weekly traded volume stood at 63.51%. The average daily trading volume fell to 79,224 shares this week, from 157,959 shares last week. Similarly, the average daily trading value narrowed to $0.60 million, from $1.45 million a week earlier. Five gainers and three losers were screened this week, lifting the BSE’s market capitalization up by 0.20% week-on-week to $11.28 billion and the Credit Libanais Aggregate Stock Index (“CLASI”) higher by 0.23% to 1,102.34, noting that it reached its year high on Thursday. In the real estate sector, trades mainly consisted of Solidere “A” and “B” shares (35.61% of total traded volume) this week, with the price of Solidere “A” increasing by 2.76% to $10.04 and that of Solidere “B” advancing by 1.73% to $9.97. Consequently, the Credit Libanais Construction Sector Stock Index (“CLCI”) ended its week up by 1.77% to 561.19. In the banking sector, Bank Audi GDRs amassed the highest concentration of trades (35.69% of total traded volume) on a thin turnover ratio of 0.10%. The Credit Libanais Financial Sector Stock Index (“CLFI”) edged 0.15% lower this week to 1,447.21, and this owing to the 4.00% contraction in the price of Bank Audi listed shares to $6.00, coupled with some 0.82% drop in the price of the Bank Audi GDRs to $6.05, outweighing as such the 3.81% appreciation in the price of BLOM Bank GDRs to $10.90 and the 3.00% increase in the price of BLOM Bank listed shares to $10.30.

LEBANESE EQUITIES

Weekly Market Watch


Credit Libanais Week of Week of Weekly YTDIndices 24-Mar-16 1-Apr-16 % Change % ChangeCredit Libanais AggregateStock Index <.CLASI> 1,099.78 1,102.34 0.23% 3.23%

Credit Libanais FinancialSector Stock Index <.CLFI> 1,449.40 1,447.21 -0.15% 4.38%

Credit Libanais ConstructionSector Stock Index <.CLCI> 551.44 561.19 1.77% -1.00%

1,000

1,020

1,040

1,060

1,080

1,100

1,120

1,140

1,160

1,180

01-A

pr-1

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Credit Libanais Aggregate Stock IndexWeekly Performance

CLASI

CLASI 0.23%

.CLASI Credit Libanais Aggregate Stock Index

Value Daily % Chng Daily Net Chng

1,102.34 -0.553% -6.12

Yr.High Year Hi.Date Yr.Low Year.Lo.Date

1,108.46 31-Mar-16 1,065.48 9-Mar-16

Life High Life Hi.Date Life Low Life.Lo.Date

1,801.01 7-Jul-08 836.11 25-Mar-09

Friday, April 01, 2016

1,300

1,350

1,400

1,450

1,500

1,550

01-A

pr-1

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ay-1

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ec-1

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Credit Libanais Financial Sector Stock IndexWeekly Performance

CLFI

CLFI 0.15%

450

500

550

600

650

700

01-A

pr-1

5

23-M

ay-1

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Credit Libanais Construction Sector Stock IndexWeekly Performance

CLCI

CLCI 1.77%

The weighted average price to earnings (P/E) multiple of listed stocks reversed its three-week upturn, slipping to 7.252x based on the closing prices of Friday. The weighted average price to book (P/BV) metric, however, increased for the fourth week in a row to reach 0.887x as at April 1, 2016.

LEBANESE EQUITIES

Weekly Market Watch


P/E P/BV

Solidere A $10.04 2.76% 77,564 24.48% $779,126 32.35% 100,000,000 $1,004,000 n.a 0.83 -9.22%Solidere B $9.97 1.73% 35,268 11.13% $354,391 14.71% 65,000,000 $648,050 n.a 0.82 -9.94%BLC Bank $1.69 0.00% - - - - 51,033,333 $86,246 7.35 0.70 -0.59%BLC Bank Preferred Class "A" $100.00 0.00% - - - - 400,000 $40,000 n.a n.a 0.00%BLC Bank Preferred Class "B" $101.50 0.00% - - - - 550,000 $55,825 n.a n.a -0.98%BLC Bank Preferred Class "C" $101.00 0.00% - - - - 350,000 $35,350 n.a n.a 0.00%Bank Audi - Listed Shares $6.00 -4.00% 2,000 0.63% $12,000 0.50% 399,749,204 $2,398,495 6.67 0.83 -0.83%Bank Audi GDR $6.05 -0.82% 113,086 35.69% $685,460 28.46% 114,988,117 $695,678 6.72 0.84 0.83%Bank Audi Preferred "F" $102.70 0.00% - - - - 1,500,000 $154,050 n.a n.a 0.98%Bank Audi Preferred "G" $101.20 0.00% - - - - 1,500,000 $151,800 n.a n.a 0.20%Bank Audi Preferred "H" $101.50 0.00% - - - - 750,000 $76,125 n.a n.a 0.00%Bank Of Beirut - Listed Shares $18.80 0.00% - - - - 16,822,467 $316,262 9.08 1.29 0.00%Bank Of Beirut Priority Shares 2014 $21.00 0.00% - - - - 4,762,000 $100,002 10.14 1.44 0.00%Bank Of Beirut Preferred "H" $26.50 0.00% - - - - 5,400,000 $143,100 n.a n.a 0.00%Bank Of Beirut Preferred "I" $26.50 0.00% - - - - 5,000,000 $132,500 n.a n.a 0.00%Bank Of Beirut Preferred "J" $26.50 0.00% - - - - 3,000,000 $79,500 n.a n.a 2.91%Byblos Bank - Listed Shares $1.70 0.00% 40,334 12.73% $67,758 2.81% 565,515,040 $961,376 8.10 0.76 5.59%Byblos Bank Preferred Class 2008 $101.60 0.00% - - - - 2,000,000 $203,200 n.a n.a 0.40%Byblos Bank Preferred Class 2009 $101.40 0.00% - - - - 2,000,000 $202,800 n.a n.a 0.80%Byblos Bank GDR $82.00 0.00% - - - - 1,309,078 $107,344 7.81 0.73 2.50%BEMO Bank - Listed Shares $1.75 0.00% - - - - 51,400,000 $89,950 9.72 1.09 -7.89%BEMO Bank Preferred Class 2013 $100.00 0.00% - - - - 350,000 $35,000 n.a n.a 0.00%BLOM Bank GDR $10.90 3.81% 45,392 14.32% $495,572 20.58% 73,896,010 $805,467 6.26 0.96 11.79%BLOM Bank Listed Shares $10.30 3.00% 435 0.14% $4,481 0.19% 215,000,000 $2,214,500 5.92 0.90 9.57%BLOM Bank Preferred Class 2011 $10.15 0.00% - - - - 20,000,000 $203,000 n.a n.a 0.00%RYMCO Class "B" $3.23 0.00% - - - - 10,920,000 $35,272 14.04 1.66 0.00%Holcim Liban $14.36 0.07% 118 0.04% $1,694 0.07% 19,516,040 $280,250 19.1 1.22 -1.10%Ciment Blancs Bearer $3.00 -18.92% 2,700 0.85% $8,100 0.34% 6,000,000 $18,000 6.25 1.23 -23.08%Ciment Blancs Nominal $3.10 0.00% - - - - 3,000,000 $9,300 6.46 1.27 0.00%

% of Weekly Volume Traded

% of Weekly Value Traded

Note: n.a stands for not applicable

Market Capitalisation

($000) YTD Price

Perf.

Weekly Volume Traded

Lebanese Equities

BEIRUT STOCK EXCHANGE

Weekly Value Traded

Total Listed Shares

Weekly %Change

Closing

Source: Beirut Stock Exchange, Credit Libanais Economic Research Unit

Previous Last % ChangeValue Traded ($) 5,812,863 2,408,580 -58.56%Volume Traded 631,835 316,897 -49.84%Average Daily Trading Value ($) 1,453,216 602,145 -58.56%Average Daily Trading Volume 157,959 79,224 -49.84%Market Cap - BSE ($) 11,260,025,594 11,282,442,452 0.20%Weighted Average P/E 7.284 7.252 -0.44%Weighted Average P/BV 0.885 0.887 0.25%Source: Beirut Stock Exchange, Credit Libanais Economic Research Unit

Activity Analysis

Source: BSE, Credit Libanais Economic Research Unit

0

2

4

6

8

March 24, 2016 April 1, 2016

7.284 7.252

0.885 0.887

Evolution of Beirut Bourse Comparable Benchmarks

P/E P/BV

LEBANON’S MAIN INDICATORS

Weekly Market Watch

SOURCE: BDL, ABL, MOF, IMF, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 15

2 0 0 6 2 0 0 7 2 0 0 8 2 0 0 9 2 0 10 2 0 11 2 0 12 2 0 13 2 0 14 2 0 15 2 0 16

MACROECONOMIC INDICATORS

GDP ($ Billion) 21.80 24.58 28.83 35.14 38.01 40.08 44.10* 47.60* 50.03* 54.40* 57.03*

Real GDP Growth Rate 1.60% 9.40% 9.10% 10.30% 8.00% 0.90% 2.80%* 2.50%* 2.00* 2.00%* 2.50%*

GDP Per Capita ($) 5,343 5,937 6,888 8,274 8,756 9,144 9,966* 10,655* 11,092* 11,945* 12,405*

Net Foreign Direct Investment ($ Billion) 2.68 3.38 4.33 4.84 4.96 3.40 2.30 3.79

FDI/GDP Ratio 12.30% 13.74% 15.02% 13.77% 13.05% 11.79% 7.86% 12.71%

INDUSTRY

Industrial Exports ($ Million) 1,737 2,353 2,978 2,595 3,291 3,530 2,952 3,076 3,150 2,956

Import of Industrial Machinery ($ Million) 130 163 188 199 227 239 288 300 269 234

TOURISM

Total Number of Tourists 1,062,635 1,017,072 1,332,551 1,851,081 2,167,989 1,655,051 1,365,845 1,274,362 1,354,647 1,517,927 191,808 (3)

Growth in Tax- Free Spending - 15% 17% 56% 13% 21% 10% - 6% 4% 8% 2%

REAL ESTATE

Value of Real Estate Transactions ($ Million) 3,120 4,175 6,444 6,958 9,479 8,841 9,175 8,708 8,952 8,006 885 (3)

Number of Real Estate Sales Transactions 49,051 65,681 80,018 83,465 94,202 82,984 74,569 69,198 70,721 63,386 5,165 (3)

Construction Permits (000 sqm) 7,532 7,919 14,281 11,509 15,187 13,980 12,362 10,527 11,164 10,294 1,722 (3)

Cement Delivery (000 tons) 3,423 3,945 4,219 4,897 5,227 5,550 5,309 5,831 5,517 5,043

TRANSP ORTATION

Beirut Port: Freight Activity (000 Tons) 4,226 5,318 5,746 5,769 6,469 6,677 7,225 8,268 8,281 7,240 1,335 (2)

Beirut Airport: Number of Passengers (million) 2.74 3.41 3.87 4.74 5.55 5.65 5.96 6.26 6.57 8.22 0.55 (2)

FOREIGN TRADE

Imports ($ Million) 9,398 11,815 16,137 16,242 17,964 20,158 21,280 21,228 20,494 18,069 2,872 (3)

Exports ($ Million) 2,283 2,816 3,478 3,484 4,253 4,265 4,483 3,936 3,313 2,952 414 (3)

Trade Balance ($ Million) (7,115) (8,999) (12,658) (12,758) (13,711) (15,893) (16,797) (17,292) (17,181) (15,117) (2,458) (3)

BALANCE OF PAY MENTS

Net Foreign Assets at the Financial Sector ($ Million) 2,792 2,037 3,461 7,899 3,325 (1,996) (1,537) (1,127) (1,407) (3,354) (719) (2)

Foreign Assets ($ Billion) 12.97 12.39 19.73 28.30 30.85 32.24 35.74 35.29 37.86 37.09 36.59 (5)

P UBLIC FINANCE

Government Expenditures ($ Million) 7,880 8,350 9,922 11,388 11,336 11,675 13,321 13,640 13,952 13,528

Government Revenues ($ Million) 4,853 5,804 7,000 8,428 8,414 9,333 9,396 9,420 10,879 9,576

Budget Primary Defic it / Surplus ($ Million) 1,335 1,787 2,730 3,380 1,203 1,662 (110) (240) 1,307 724

Total Defic it ($ Million) (3,027) (2,546) (2,921) (2,960) (2,894) (2,342) (3,925) (4,220) (3,073) (3,952)

Defic it / GDP Ratio 13.89% 10.36% 10.13% 8.42% 7.61% 5.84% 8.90% 8.87% 6.14% 7.26%

Debt Service / GDP Ratio 13.47% 13.08% 12.16% 11.49% 10.85% 9.99% 8.21% 7.96% 8.75% 8.60%

Net Public Debt ($ Billion) 37.42 39.02 41.50 44.11 45.01 46.35 49.12 53.18 57.30 61.54 61.74 (2)

Gross Public Debt/GDP Ratio 185.19% 171.02% 163.09% 145.57% 138.39% 133.89% 130.80% 133.36% 133.05% 132.40%

MONETARY AGGREGATES & INFLATION

M4 ($ Billion) 56.08 63.56 72.58 87.08 97.31 103.50 110.00 117.41 124.53 131.17 131.37 (4)

(M2- M1) ($ Billion) 13.37 14.11 21.93 31.14 35.66 35.82 39.32 40.56 43.27 46.25 46.51 (4)

Monetization Level (M2/GDP Ratio) 69.39% 65.76% 85.55% 97.35% 103.46% 99.32% 103.14% 102.75% 102.34%

Change in CPI (%) 5.60% 9.30% 6.36% 4.20% 6.19% 4.27% 4.68% 2.05% - 1.66% - 3.40% - 2.94% (3)

BANKING SYSTEM

Number of Commercial Banks 54 54 53 53 54 54 54 56 55 54 (1)

Number of Branches 830 847 860 885 912 948 962 985 1,020 1,033 (1)

Total Assets ($ Million) 76,179 82,255 94,255 115,250 128,925 140,576 151,883 164,821 175,697 185,989 186,202 (2)

Total Deposits ($ Million) 61,541 68,059 78,663 96,821 108,601 117,703 127,657 139,166 147,637 154,951 154,842 (2)

Loans to the Private Sector ($ Million) 17,201 20,425 25,039 28,374 34,929 39,375 43,452 47,381 50,899 54,224 54,391 (2)

Customer Loans/ Deposits 27.95% 30.01% 31.83% 29.31% 32.16% 33.45% 34.04% 34.05% 34.48% 34.99% 35.13% (2)

Dollarization Rate 75.16% 77.34% 69.57% 64.46% 63.24% 65.92% 64.82% 66.10% 65.71% 64.88% 64.67% (2)

Net Profit - After Tax ($ Million) 754 962 1,215 1,429 1,838 1,743 1,620

Exchange Rate (LBP to USD) 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50 1,507.50

* Figures Reflect IM F Estimates

(1) As at End of September, 2015, (2) As at End of January, 2016, (3) As at End of February, 2016, (4) As at M arch 17 , 2016, (5) As at End of M arch, 2016

Recap of Lebanon's Major Indicators

LEBANON’S RATINGS

Weekly Market Watch

SOURCE: S&P, MOODY’S, FITCH, CAPITAL INTELLIGENCE, CREDIT LIBANAIS ECONOMIC RESEARCH UNIT 16

Rated Banks

Long Term Foreign Currency

Financial Strength

Outlook Long Term Foreign Currency

Outlook Long Term IDR

Outlook Long-Term Counterparty Credit Rating

Short-Term Counterparty Credit Rating

Outlook

Bank Audi B2 E+ Negative B Stable B Stable B- C Negative

BLOM Bank B2 E+ Negative B Stable - - B- - Negative

Credit Libanais - - - B Stable - - - - -

Byblos Bank B2 E+ Negative B Stable B Stable - - -

BBAC - - - B Stable - - - - -

Fransabank - - - B Stable - - - - -

BankMed - - - - - - - B- C Negative

Lebanese Banks' Latest Ratings

Capital Intelligence Moody's Investors Service Fitch Ratings

Sources: M oody's Investors Service, Capital Intelligence, Fitch Ratings, S&P Ratings

S&P Ratings

Rating Agency Tenor Rating

Long- Te rm B-

Short- Te rm B

Moody's Inve stors Se rvic e Ltd. Long- Te rm B2

Fitc h IBCA Ltd. Long- Te rm B

Short- Te rm B

Source: M oody's Investors Service, Standard & Poor's, Fitch Ratings

Republic Of Lebanon Sovereign Ratings

Outlook

Standa rd & Poor's Ne ga tive

Ne ga tive

Ne ga tive

CONTACTS

RESEARCH

Fadlo I. Choueiri, CFA

[email protected]

961-1-608 000 EXT: 1280 Jad Abi Haidar [email protected] 961-1-608 000 EXT. 1283

Joelle Samaha [email protected] 961-1-608 000 EXT. 1281 Joanna Gergi [email protected] 961-1-608 000 EXT. 1284

Mayda Zaarour [email protected] 961-1-608 000 EXT. 1282

MONEY MARKETS DESK

Robert Araman

[email protected]

961-1-608 000 EXT. 0760

This document is being furnished to you solely for your information and may not be reproduced or redistributed to any other person. This document does not constitute an offer or invitation to subscribe to or purchase any security, and neither this document nor anything contained herein shall form the basis of any contract or commitment whatsoever. Reasonable care has been taken to ensure that the facts stated herein are accurate and the estimates, opinions and expectations contained herein are fair and reliable.

Weekly Market Watch

ECONOMIC RESEARCH UNIT - ADLIEH, BEIRUT LEBANON - TEL: 01-608000 FAX: 01-608231 17

weekly market watch economic research unit · 2016-04-02 · the world travel & tourism council...

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