Banking on establishing momentum

Headquartered in Beirut, BankMed is one of the fastest growing banks in Lebanon. Originally established in 1944, its market share – measured by total assets – has grown considerably over the years to comprise almost 10 percent of the total Lebanese banking system. Through its 55 branches spread all over Lebanon, and one in Cyprus, the Bank offers a wide range of innovative products and quality services that are tailored to individuals as well as corporations’ needs. Results achieved in 2011 placed BankMed as the top performer among its peers, with its net profits increasing by 11.3 percent to reach $117.5m by the end of the year, compared to $105.6m in 2010. At the end of the first quarter of 2012, BankMed’s total assets stood at $13.60bn and customer deposits recorded $11.12bn. Overall, the bank achieved a $29m net profit in the first quarter of 2012, a 13.9 percent increase on the same period last year.

Diversity in operations
BankMed has been traditionally known more as a corporate bank given the key role it played in funding the reconstruction of Lebanon in the nineties after the end of the civil war. Nonetheless, understanding the importance of keeping pace with the needs of a fast-changing financial landscape, BankMed has opted to expand its banking services to include retail, private, commercial, investment, and brokerage services. Thanks to its distinctive customer-oriented culture, which delivers quick processing and responses to client requests, BankMed has been able to successfully cater to individuals and large corporate clients, as well as small and medium enterprises (SMEs).

In corporate banking, BankMed has continued to hold one of the largest commercial lending portfolios in the Lebanese Market, covering top-tier corporate clients that vary across all industries. The bank’s historical focus on the corporate sector has endowed it with a more focused business model and a history of transaction structuring. In 2011, and in spite of the regional turmoil and its financial consequences, BankMed’s commercial lending portfolio witnessed considerable growth, outperforming its peer group and achieving an average growth of 25 percent in its loan portfolio; the highest among Lebanese banks.

The bank has managed to attract new clients and expand its customer base, especially with the establishment of a dedicated international banking business entity, created to serve its current customers outside Lebanon more efficiently. In recent years, BankMed has put efforts towards enhancing trade finance, given its continual increasing demand. With its strong network of banking partners which consists of more than 70 names in over 55 countries, all of which reputable names with excellent services, BankMed has been able to successfully expand its trade finance activities on both primary and secondary markets, and has been able to explore new avenues of opportunities.

BankMed’s retail banking has also seen significant growth in recent years with the introduction of unique retail products and services. The bank has enhanced its delivery channels by adding new branches, entering new markets, and acquiring a full range of state-of-the-art remote delivery channels. Furthermore, new products and services have been introduced, tailor-made to customers’ individual needs, including new loyalty cards, gift cards, and payment cards.

On the investment front, BankMed’s treasury has offered clients access to local, regional, and international markets through its extensive and solid relationships with brokers and market makers around the world. In 2011, the treasury focused its efforts on structuring and marketing different hedging and investment products. The treasury has also successfully diversified its liquidity profile, minimising counterparty and sovereign risk without any effect on overall profitability. Available 24 hours a day, brokerage services have been handled by the bank’s wholly owned subsidiary, MedSecurities, the brokerage arm of BankMed. MedSecurities managed to end the very challenging year recording an increase in net income of 12 percent, with the introduction of new investment products and services.

Recently, BankMed geared its efforts by focusing on SME’s business, a steadily important segment of the economy. As such, and given its growing concern with sustainable community development, BankMed established ‘Emkan Finance s.a.l’ in June 2011; a financial institution licensed by the Central Bank of Lebanon. Emkan Finance has provided to date (up to March 2012) over $30m worth of microloans for the economically active poor in Lebanon, whose number has extended to about 20,000 borrowers, thereby allowing clients access to microfinance services unavailable to them in the formal banking sector.

International presence
The bank has recently grown its international presence in Cyprus, Switzerland, Turkey, Iraq, and the Kingdom of Saudi Arabia (KSA); by opting to expand only in selected markets, greater value has been added for clients. This well-studied oversees expansion of BankMed has proven to have served the bank well as it has no presence in countries that were recently affected by the political changes in the Arab world.

BankMed’s private bank in Switzerland, BankMed Suisse, has engaged in asset-management and advisory banking services, reinforcing the bank’s private banking offering across different markets, and encompassing both traditional banking services as well as new innovative products. On a more regional level, BankMed has expanded its presence to Turkey since 2007 through ‘T-Bank’. With its 27 branches across Turkey’s most prominent industrial and commercial hubs, T-Bank has provided its customers with unique banking solutions in line with its niche banking approach. T-Bank has enjoyed a robust position in the Turkish banking sector with its expertise in commercial lending, treasury products, and trade finance services.

During 2011, T-Bank focused on utilising its prominent branch network to diversify its product offers to existing customers, as well as gearing up marketing efforts to attract new ones. Today, T-Bank has been singled out as the most important partner for Turkish entrepreneurs willing to operate in the MENA area. Moreover, with other Lebanese and Arab banks only now just grasping the growth potential of the Turkish economy and starting to seriously consider the Turkish market, BankMed’s early entry into the market has given it a strong competitive advantage.

Since 2008, BankMed has opted to expand its activities to investment banking through the establishment of the ‘SaudiMed Investment Company’ in Riyadh, providing investment and corporate advisory services to a growing clientele base in the KSA and the Middle East region. SaudiMed has continued to pursue several local and regional corporate finance advisory mandates throughout 2011 in various industries and sectors; namely healthcare, real estate developments, industrial raw materials manufacturing, and credit card services.

Moreover, based on its extensive experience and in line with its plans for further regional expansion, BankMed announced the opening of its two new branches in Erbil and Baghdad, Iraq. The former became fully operative in May 2012, while the latter is set to open later this year. This step has been coupled with the bank’s strong belief in the potential of the Iraqi economy.

On the whole, and in spite of the recent global and regional instabilities, BankMed has been able to grow its business and to expand and strengthen its regional and international presence. The double-digit growth recorded in 2011 has served as an indication of the strong performance of the Bank’s activities. BankMed’s strategy moving forward is to further expand its client base and take advantage of new innovations and technologies in order to better serve them.

Investing in Lebanon
– Lebanese GDP: $61.61bn
– Before 2011, the country enjoyed four years of GDP growth at an eight percent average
– Main export partners include: Syria, UAE, Saudi Arabia, Turkey and Switzerland
– An estimated labour force of 1.5m, in addition to as many as one million foreign workers