Lebanon's Blom Bank profit falls, auditors give ‘adverse opinion’

BEIRUT: Blom Bank said on Thursday its net profits fell by 77% to $115.4 million in 2019 as a financial and economic crisis hit Lebanon and external auditors had given an "adverse opinion" concerning its financial statements in the country for the year.

"The results obtained were largely as expected, and affected by the impact of the financial and economic crisis that has struck Lebanon since October 2019," Blom Bank, one of Lebanon's biggest, said in a statement.

Lebanon sank into a major financial crisis in October since when the local currency has lost some 80% of its value amid a hard currency liquidity crunch.

"The Board of Directors has noted and approved the adverse opinion of the external auditors concerning the financial statements of our bank in Lebanon for year 2019," Blom Bank said.

Blom Bank said the board had decided to publicise the adverse opinion for the sake of transparency but gave no further details.

Assets stood at $33.3 billion, 9.4% lower, and deposits were $26.5 billion, down 2.8%. Loans were 18.9% lower, it said.

"Net profits emanated mostly from our units outside Lebanon, especially from our unit operating in Egypt which constituted 43% of consolidated profits," it said.

The branches in Lebanon did not generate any profits as a result of central bank circulars to cover credit risks arising from the situation in Lebanese financial markets, it said.

Depositors have largely been frozen out of their savings across the banking sector since the crisis hit. Blom Bank expressed "its regret for all the restrictions that it was obliged to impose".