Byblos Bank reported flat growth in net income of $80 million for the first half of 2012 compared with same period last year, unaudited results released by the bank showed Thursday. Byblos Bank chairman François Bassil had told The Daily Star earlier this month that he expected the combined net profits of the Lebanese banking sector to plunge by 5-10 percent at the end of 2012 due to domestic political bickering and the volatile situation in neighboring Syria. “Within the context of volatile and uncertain regional conditions Byblos Bank adopted throughout the first half of 2012 a conservative strategy aimed at preserving the bank’s solid financial position through reinforced resilience, high liquidity ...” Byblos Bank’s statement said. Some leading banks have actually seen their profits fall in the first quarter of 2012 with most of them increasing provisions for non-performing loans since the crisis in Syria started 16 months ago. Byblos Bank allocated $23.1 million in provisions for credit losses during the first half of 2012 including $8.4 million of collective provisions, according to the bank statement. Gross Non-performing Loans represented 3.94 percent of gross loans and were covered up to 70.8 percent by specific provisions and reserved interest, it added. As of the end of June 2012, net customer loans increased by 2.1 percent to reach $4.1 billion, the bank reported while customer deposits grew by 3.5 percent to $13.3 billion. Byblos Bank added that it maintained high capitalization levels with a Basel III Capital Adequacy Ratio of 13.30 percent, one of the highest in the sector, versus a 12 percent minimum regulatory requirement. Byblos’ unaudited consolidated total assets stood at $16.6 billion as of the end of the June 2012 with primary liquidity amounting to $9.1 billion stood at 68.7 percent of total deposits. The latest data on Lebanon’s banking sector revealed that the total assets held by Lebanese commercial banks reached $144.86 billion at the end of May 2012, up by 8.07 percent from May 2011 and 3.05 percent from December 2011. Last week, Bank Audi reported that its net profits surged in the first six months of 2012 by 27.7 percent to $230.1 million thanks to the sale of 81 percent of its stake in LIA insurance while SGBL, another leading bank in Lebanon, recorded a net profit of $59 million, an increase of 29 percent compared to the same period last year. According to Central Bank Governor Riad Salameh, Lebanon has “liquid” foreign-currency assets of more than $32 billion and a stock of gold worth about $16 billion. Lebanese banks have been continuously attracting more deposits and gradually reducing their exposure to government debt. Moody’s changed its outlook on Lebanese banks to negative from stable in December, citing risks to economic growth due to “regional political uncertainty.” Credit to private businesses and consumers has exceeded $40 billion in 2012, while lending to the government stands at about $28 billion, extending a reversal that started in 2009 in how the country’s banks deploy funds. Lebanon’s debt stood at 134 percent of economic output at the end of October, and about 40 percent of it is denominated in foreign currency, according to the International Monetary Fund. The IMF has encouraged Lebanon to raise interest rates on T-bills to attract more investors and inject more cash into the country’s treasury. In line with an IMF recommendation, the yield on local-currency government debt has risen by 50 basis points since March. Dialy Star