Overall Lebanese Banks Performance: A Risk-Return Framework

Abstract

The Lebanese commercial banks constitute the corner stone of the financing system in Lebanon. This paper analyzes the performance of the Lebanese banks in terms of profitability and risks for the period 1993 through 2002. A detailed investigation related to the structure and regulation of this industry is presented. The profitability is studied using the Du Pont equation and the overall risk of the Lebanese commercial banks is captured through the structure of the risk index suggested by Hannan and Hanweck (1998).