Towards Early Critical Warnings of Lebanese Banks: An Analytical CAMELS Study

Georges Chlela and Hasan Mousawi

International Business Research, 2025, vol. 18, issue 1, 30

Abstract: The stability of the Lebanese banking sector has been jeopardized following the financial crisis that unfolded in 2019. This instability manifested through a loss of customer confidence, widespread doubts about the banks’ ability to repay deposits, indirect control over capital, and restrictions on withdrawals, particularly in foreign currencies. As a result, the Lebanese banking sector, once regarded as the backbone of the economy, now faces an existential challenge. The financial health of the country has deteriorated significantly, especially after the Lebanese government declared bankruptcy on euro bonds held by local commercial banks, coupled with the depreciation of the Lebanese pound against foreign currencies. To evaluate the potential for recovery and the challenges ahead, a study of ten Lebanese commercial banks was conducted using the CAMELS model, which examines capital adequacy, asset quality, management quality, profitability, liquidity, and sensitivity to market risk. The findings reveal that by 2022, all assessed banks received a CAMELS score of 4, reflecting the profound financial and economic crisis in Lebanon.

Date: 2025
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ccsenet.org/journal/index.php/ibr/article/download/0/0/51200/55578 (application/pdf)
https://ccsenet.org/journal/index.php/ibr/article/view/0/51200 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ibn:ibrjnl:v:18:y:2025:i:1:p:30

Access Statistics for this article

More articles in International Business Research from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().