Lebanon's BLC eyes bigger slice of domestic market

Beirut: Lebanon's BLC Bank, bought by a state-owned Qatari institution in the biggest takeover in Lebanese banking history, said on Thursday that it plans to boost its domestic market share and expand abroad.

BLC chairman Shadi Karam, who will stay on under the new owners, said the $236.3 million deal would give the bank more resources and expertise to develop.

"Now we can develop with an infinitely higher level of resources. It is a dream to be able to work with such partners," Karam said. "We will develop aggressively and there is no doubt we will quickly acquire a larger market share."

Qatar's Supreme Council for Economic Affairs and Investment, which now owns 96.22 per cent of BLC, has promised to inject more than $100 million into BLC soon, with another increase that could reach more than $300 million in the next five years.

Lebanon's central bank, which took over BLC in mid-2002 to rescue it from bankruptcy, launched an auction for it in November, setting $165 million as the minimum bid.

The central bank had itself injected $147 million of capital into the bank to absorb some of the worst losses in Lebanese banking history, and changed the management, helping BLC to return to profit in 2003.

BLC's profits tripled to $15.8 million in 2004 after it shed staff and cracked down on bad loans. It has 35 branches across Lebanon and four branches in the UAE, run through a subsidiary, as well as a unit in Paris.

Karam said 22 Lebanese and foreign institutions had expressed an interest in the bank and four had made bids, all of them above $200 million, valuing BLC at around $250 million.