Obligation Blom Bank SAL 7.5% ( XS1790041278 ) en USD

Blom Bank SAL

100 % ⇌

Liban

XS1790041278 ( en USD )

7.5% par an ( paiement semestriel )

03/05/2023 - Obligation échue

Prospectus brochure de l'obligation BLOM Bank S.A.L XS1790041278 en USD 7.5%, échue

200 000 USD

300 000 000 USD

BLOM Bank S.A.L. est une banque commerciale libanaise offrant une large gamme de services bancaires aux particuliers et aux entreprises, avec une présence internationale significative.

L'Obligation émise par Blom Bank SAL ( Liban ) , en USD, avec le code ISIN XS1790041278, paye un coupon de 7.5% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 03/05/2023

BLOM BANK S.A.L.
(incorporated in the Lebanese Republic with limited liability)
List of Banks 14, Commercial Registry: Beirut, 2464
U.S.$300,000,000 7.500% Deposit Certificates due 2023
The U.S.$300,000,000 7.500% Deposit Certificates due 2023 (the "Certificates") will be issued by BLOM Bank s.a.l. (the "Issuer" or
the "Bank") at an issue price of 100% of their principal amount. It is expected that the Certificates will be issued on 4 May 2018 (the
"Issue Date") and, unless previously redeemed by the Issuer for tax reasons, repaid on 4 May 2023 at their principal amount.
The Certificates are subject to redemption in whole at their principal amount at the option of the Issuer at any time in the event of certain
changes affecting taxation in the Lebanese Republic ("Lebanon"). See "Terms and Conditions of the Certificates--Redemption".
The Certificates will bear interest from and including the Issue Date at the rate of 7.500% per annum payable semi-annually in arrear on
4 May and 4 November in each year, commencing on 4 November 2018, until their maturity. Payments on the Certificates will be made
in U.S. Dollars without deduction for or on account of taxes imposed or levied by Lebanon to the extent described under "Terms and
Conditions of the Certificates--Taxation".
This prospectus (the "Prospectus") constitutes a prospectus for the purposes of Article 5.3 of Directive 2003/71/EC, as amended (the
"Prospectus Directive") for purposes of the admission to trading of the Certificates on the Market (as defined below). Application has
been made to the Commission de Surveillance du Secteur Financier (the "CSSF") in its capacity as competent authority, under the
Luxembourg law dated 10 July 2005 on prospectuses for securities (loi relative aux prospectus par valeurs mobilières), as amended by
the Luxembourg law dated 3 July 2012 (the "Law on Prospectuses for Securities"), to approve this document as a prospectus. The CSSF
gives no undertaking as to the economic and financial soundness of the transaction or the quality or solvency of the Issuer in accordance
with Article 7(7) of the Law on Prospectuses for Securities. Application has also been made to the Luxembourg Stock Exchange for the
Certificates to be admitted to trading on the Luxembourg Stock Exchange's Regulated Market (the "Market") and to be listed on the
Official List of the Luxembourg Stock Exchange (the "Official List"). References in this Prospectus to the Certificates being "listed"
(and all related references) shall mean that the Certificates have been admitted to the Official List and have been admitted to trading on
the Market. The Market is a regulated market for the purposes of Directive 2014/65/EU. There is no assurance that a trading market in the
Certificates will develop or be maintained.
The Certificates have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"). The
Certificates are being offered outside the United States by the Joint Lead Managers (as defined in "Subscription and Sale") in accordance
with Regulation S under the Securities Act ("Regulation S"), and may not be offered, sold or delivered within the United States except
pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.
The Certificates will be in registered form and issued, offered and sold in denominations of, and may be held and transferred in principal
amounts of, U.S.$200,000 and integral multiples of U.S.$1,000 in excess thereof. The Certificates will be represented by a global
certificate (the "Global Certificate") registered in the name of a nominee for, and deposited with, the common depositary for Euroclear
Bank SA/NV ("Euroclear") and Clearstream Banking S.A. ("Clearstream, Luxembourg"). Interests in the Certificates may also be held
through Midclear, s.a.l., Lebanon's central clearing and settlement agency ("Midclear"). Certificates held through Midclear will be settled
through Midclear's participant accounts with Euroclear and Clearstream. Individual Certificates ("Individual Certificates") evidencing
holdings of Certificates will only be available in certain limited circumstances. See "Overview of Provisions relating to the Certificates in
Global Form".
The Certificates are expected to be rated B3 by Moody's Investor Services Limited ("Moody's"). A rating is not a recommendation to
buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning rating organisation. Any
change in the rating of the Certificates could adversely affect the price that a purchaser would be willing to pay for the Certificates. The
Bank has been assigned a long-term deposit rating of B3 (outlook stable) by Moody's and a foreign currency long-term rating of B-
(outlook stable) by Standard & Poor's Credit Market Services Europe Limited ("S&P"). As at the date of this Prospectus, each of S&P
and Moody's is established in the European Union and registered under Regulation (EU) 1060/2009 on credit rating agencies, as
amended (the "CRA Regulation"). As such, each of S&P and Moody's is included in the latest update of the list of registered credit rating
agencies published by the European Securities and Markets Authority on its website (http://www.esma.europa.eu/page/Listregistered-and-
certified-CRAs) in accordance with the CRA Regulation as of the date of this Prospectus.
Joint Bookrunners and Joint Lead Managers
CITIGROUP
DEUTSCHE BANK
Selling Agent
BLOMINVEST BANK
The date of this Prospectus is 2 May 2018.

IMPORTANT NOTICE
Each of the Issuer (and the members of its board of directors) and the Selling Agent accepts legal responsibility for the
information contained in this Prospectus and declares that, having taken all reasonable care to ensure that such is the case:
(i) the information contained in this Prospectus, to the best of its knowledge, is in accordance with the facts and contains
no omission likely to affect its import; and (ii) there are no facts that have been omitted that would make any statement
in this Prospectus inaccurate or misleading.
The Issuer has not authorised the making or provision of any representation or information regarding the Issuer or the
Certificates other than as contained in this Prospectus. Any such representation or information should not be relied upon
as having been authorised by the Issuer, the Selling Agent (as defined in "Subscription and Sale") or the Joint Lead
Managers.
Neither the Joint Lead Managers nor any of their respective affiliates have authorised the whole or any part of this
Prospectus and none of them make any representation or warranty or accepts any responsibility as to the accuracy or
completeness of the information contained in this Prospectus, or as to any acts or omissions of the Issuer or any other
person (other than the Joint Lead Managers) in connection with the issue and offering of the Certificates.
This Prospectus does not constitute an offer of, or an invitation to subscribe for or purchase, any Certificates.
The distribution of this Prospectus and the offering, sale and delivery of Certificates in certain jurisdictions may be
restricted by law. Persons into whose possession this Prospectus comes are required by the Issuer, the Joint Lead Managers
and the Selling Agent to inform themselves about and to observe any such restrictions. For a description of certain
restrictions on offers, sales and deliveries of Certificates and on distribution of this Prospectus relating to the Certificates,
see "Subscription and Sale".
In particular, the Certificates have not been and will not be registered under the Securities Act or with any regulatory
authority in the United States, may not be offered or sold within the United States or to, or for the account or benefit of,
any U.S. person (as defined in Regulation S under the Securities Act), and are subject to United States tax law
requirements. Certificates may not be offered, sold or delivered within the United States, except pursuant to an exemption
from, or a transaction not subject to, the registration requirements of the Securities Act. See "Subscription and Sale".
The Certificates will only be sold to Eligible Investors outside of the United States in offshore transactions in reliance
upon Regulation S under the Securities Act. An "Eligible Investor" is any person that is a Professional Client (as defined
under Capital Markets Authority of Lebanon ("CMA") regulations) and who is not a U.S. person, a subsidiary or affiliate
of the Issuer or any other person acting on behalf of any such person. Neither the Issuer nor any of its subsidiaries or
affiliates may directly or indirectly finance the purchase of Certificates.
The CMA is a regulatory body responsible for the regulation of the capital markets in Lebanon. The marketing, offering,
distribution and sale of the Certificates in Lebanon must comply with all applicable laws and regulations in Lebanon, in
particular, Law 161 dated 17 August 2011 (the "Capital Markets Law"), which prohibits marketing or promoting
financial instruments in Lebanon prior to obtaining the authorisation of the Board of the CMA to that effect. This
Prospectus complies with the requirements of the Capital Markets Law and the CMA Series 6000 Regulation, relating to
the Offers of Securities, dated 27 July 2017. On 7 March 2018, the CMA authorised the offer and sale of the Certificates
in Lebanon. In addition to any other applicable requirements described herein, Eligible Investors located in Lebanon are
also required to sign a subscription form, substantially in the form of Annex A hereto, as a condition to making an
investment in the Certificates.
THIS PROSPECTUS INCLUDES INFORMATION PROVIDED IN COMPLIANCE WITH
THE
REGULATIONS OF THE CMA. NEITHER BANQUE DU LIBAN (THE CENTRAL BANK OF LEBANON
(THE "CENTRAL BANK")) NOR THE CMA ACCEPTS ANY RESPONSIBILITY FOR THE CONTENT OF
THE INFORMATION IN THIS PROSPECTUS, INCLUDING THE ACCURACY OR COMPLETENESS OF
SUCH INFORMATION. THE LIABILITY FOR THE CONTENT OF THIS PROSPECTUS LIES WITH THE
ISSUER, ITS DIRECTORS AND OTHER PERSONS, SUCH AS EXPERTS (BUT EXCLUDING, FOR THE
AVOIDANCE OF DOUBT, THE JOINT LEAD MANAGERS), WHOSE OPINIONS ARE INCLUDED IN
THIS PROSPECTUS WITH THEIR CONSENT. THE CMA HAS ALSO NOT ASSESSED THE
SUITABILITY OF THE SECURITIES COVERED BY THIS PROSPECTUS FOR ANY PARTICULAR
INVESTOR OR TYPE OF INVESTOR.
The contents of this document are not to be construed as legal, business or tax advice. In making an investment decision,
an investor must rely solely on its own independent appraisal of the economic, political and social conditions prevailing
i

in Lebanon and in the Middle East and North Africa ("MENA") region, the financial condition and results of operation
of the Issuer and the terms and conditions of the Certificates, as well as all such other information and matters as the
investor deems appropriate in determining whether to purchase Certificates, and each investor is urged to consult its own
counsel, accountant or business advisor regarding legal, tax and related matters in connection with its purchase, holding
and sale of Certificates. In particular, an investor should be aware that it may be required to bear the risk of no liquidity,
as well as the financial and other risks of its investment for an indefinite period of time.
In particular, the investment activities of certain investors are subject to legal investment laws and regulation, or review
or regulation by certain authorities. Each potential investor should consult its legal advisers to determine whether and to
what extent: (i) the Certificates are legal investments for it; (ii) the Certificates can be used as collateral for various types
of borrowing; and (iii) other restrictions apply to its purchase or pledge of the Certificates. Financial institutions should
consult their legal advisers or the appropriate regulators to determine the appropriate treatment of the Certificates under
any applicable risk-based capital or similar rules.
The delivery of this Prospectus does not at any time imply that the information contained herein is correct at any time
subsequent to the date hereof or such other date as at which it is stated to be given or that any other information supplied
in connection with the Certificates is correct as at any time subsequent to the date indicated in the document containing
the same. Neither the delivery of this Prospectus nor the offering, sale or delivery of any Certificate shall in any
circumstances create any implication that there has been no change, or any event reasonably likely to involve any change,
in the condition (financial or otherwise) of the Issuer since the date of this Prospectus or earlier date as of which
information is stated to be given.
A potential investor should not invest in the Certificates unless it has the expertise (either alone or with a financial adviser)
to evaluate how the Certificates will perform under changing conditions, the resulting effects on the value of the
Certificates and the impact this investment will have on the potential investor's overall investment portfolio.
In connection with the issue of the Certificates, Deutsche Bank AG, London Branch (the "Stabilising Manager")
(or persons acting on behalf of the Stabilising Manager) may over-allot Certificates or effect transactions with a view to
supporting the price of the Certificates at a level higher than that which might otherwise prevail. However, stabilisation
may not necessarily occur. Any stabilisation action may begin on or after the date on which adequate public disclosure of
the terms of the Certificates is made and, if begun, may cease at any time, but it must end no later than the earlier of 30
days after the issue date of the Certificates and 60 days after the date of the allotment of the Certificates. Any stabilisation
action or over-allotment must be conducted by the relevant Stabilisation Manager(s) (or person(s) acting on behalf of any
Stabilisation Manager(s)) in accordance with all applicable laws and rules.
MIFID II product governance / Professional investors and ECPs only target market Solely for the purposes of
each manufacturer's product approval process, the target market assessment in respect of the Certificates has led
to the conclusion that: (i) the target market for the Certificates is eligible counterparties and professional clients
only, each as defined in Directive 2014/65/EU (as amended, "MiFID II"); and (ii) all channels for distribution of
the Certificates to eligible counterparties and professional clients are appropriate. Any person subsequently
offering, selling or recommending the Certificates (a "distributor") should take into consideration the
manufacturers' target market assessment; however, a distributor subject to MiFID II is responsible for
undertaking its own target market assessment in respect of the Certificates (by either adopting or refining the
manufacturers' target market assessment) and determining appropriate distribution channels.
NOTICE TO LEBANESE INVESTORS
The marketing, offering, distribution and sale of the Certificates in Lebanon must comply with all applicable laws and
regulations in Lebanon, in particular, the Capital Markets Law which prohibits marketing or promoting financial
instruments in Lebanon prior to obtaining the authorisation of the Board of the CMA to that effect, and CMA Series 6000
related to regulation on offer of securities dated 27 July 2017. On 7 March 2018, the Selling Agent received the
authorisation of the Board of the CMA to offer and sell the Certificates on the terms set forth in this Prospectus.
The Certificates may only be sold in the Lebanese Republic to "Professional Clients". Professional Clients are defined
under CMA regulations as clients who are either: (a) a Lebanese collective investment scheme, pension fund or any other
institution whose main activity is to invest in securities and financial products; (b) a foreign investment fund or pension
fund that is properly licenced in its home country; (c) a government, government agency or public authority of any
country; or (d) a joint stock company or an individual client that the approved institution has determined, after making
and documenting due enquiries: (i) has net investible assets equal to a value of at least U.S.$500,000 ("Net investible
assets" means the client's holdings of cash and securities, net of any amounts owing on loans made for investment
purposes); and (ii) has a minimum of five years of continuous experience investing in securities markets and investments.
ii

FORWARD-LOOKING STATEMENTS
This Prospectus contains forward-looking statements. These statements appear in a number of places in this Prospectus
and include statements regarding the Bank's intent, belief or current expectations or those of the Bank's Management (as
defined below) with respect to, among other things:
·
statements regarding the Bank's results of operations, financial condition and economic performance;
·
statements regarding the Bank's competitive position and the effect of such competition on its results of operations,
financial condition and economic performance;
·
statements regarding trends affecting the Bank's financial condition, results of operations or economic
performance;
·
statements of the Bank's plans, including those related to new products or services, future capital expenditure plans
and anticipated customer demand for those products or services and potential acquisitions;
·
statements regarding the ongoing political and military developments in Lebanon and the MENA region; and
·
statements regarding the potential impact of regulatory actions on the Bank's business, competitive position,
financial condition, results of operations and economic performance.
These forward-looking statements can be identified by the use of forward-looking terminology such as "believes",
"expects", "may", "is expected to", "will", "will continue", "should", "approximately", "would be", "seeks", or
"anticipates" or similar expressions or comparable terminology, or the negatives thereof. Such forward-looking
statements are not guarantees of future performance and involve risks and uncertainties, and actual results, performance,
expenditure or achievements of the Bank may differ materially from those expressed or implied in the forward-looking
statements as a result of various factors. The information contained in this Prospectus, including, without limitation, the
information under "Risk Factors", "Management Discussion and Analysis of Financial Condition and Results of
Operations", "Selected Statistical and Other Data", "Business", "The Banking Sector and Banking Regulation in
Lebanon" and "Description of the Share Capital of the Bank", identifies important factors that could cause such
differences. In addition, many other factors, including those which may be beyond the control of the Bank, could affect
the Bank's actual condition, results of operations or economic performance and could cause actual results to differ
materially from those in the forward-looking statements. The Bank does not undertake to update any forward-looking
statements made herein.
PRESENTATION OF FINANCIAL AND OTHER INFORMATION
Presentation of Financial Information
Information in this Prospectus relates to BLOM Bank S.A.L., a bank incorporated in Lebanon with limited liability, and
its consolidated subsidiaries (collectively, the "Subsidiaries"). References to "Management" are to the Issuer's senior
management team. References to the "Government" are to the government of the Lebanese Republic.
Financial information included in this Prospectus has, unless otherwise indicated, been derived from: (i) the audited
consolidated financial statements of the Bank as at, and for the year ended, 31 December 2015 (which include comparative
data as at, and for the year ended, 31 December 2014) (the "2015 Financial Statements"); (ii) the audited consolidated
financial statements of the Bank as at, and for the year ended, 31 December 2016 (which include comparative data as at,
and for the year ended, 31 December 2015) (the "2016 Financial Statements"); and (iii) the audited consolidated
financial statements of the Bank as at, and for the year ended, 31 December 2017 (which include comparative data as at,
and for the year ended, 31 December 2016) (the "2017 Financial Statements" and, collectively with the 2015 Financial
Statements and the 2016 Financial Statements, the "Financial Statements"). The Bank's independent auditors issued a
qualified audit opinion in respect of each of the 2017 Financial Statements and the 2016 Financial Statements. See
"Management Discussion and Analysis of Financial Condition and Results of Operations--Central Bank Exchange
Transactions".
The Bank's Financial Statements were prepared in accordance with standards issued or adopted by the International
Accounting Standards Board and interpretations issued by the International Financial Reporting Interpretations
Committee, the general accounting plan for banks in Lebanon and the regulations of the Central Bank and the Banking
Control Commission (the "BCC") and include the results of the Bank and its Subsidiaries. BDO, Semaan, Gholam & Co.
and Ernst & Young p.c.c., members of the Lebanese Association of Certified Public Accountants, have jointly audited
iii

the Financial Statements. As used in this Prospectus, references to "IFRS" are to International Financial Reporting
Standards.
The Bank maintains its accounts in Lebanese Pounds. Accordingly, U.S. Dollar amounts stated in this Prospectus have
been translated from Lebanese Pounds at the rate of exchange prevailing at the date of the relevant statement of financial
position, in the case of balance sheet data, and at the average rate of exchange for the relevant period, in the case of
income statement data, and are provided for convenience only. In each case, the relevant rate for both the statement of
financial position and income statement data was LBP 1,507.50 per U.S.$1.00, as, throughout the periods covered by this
Prospectus, the Central Bank has maintained its policy of pegging the value of the Lebanese Pound to the U.S. Dollar at
a fixed rate of LBP 1,507.50 per U.S.$1.00.
In this Prospectus:
·
references to "U.S.$" or "U.S. Dollars" are to the United States Dollar, the lawful currency of the United States;
·
references to "" or "Euros" are to the currency introduced at the start of the third stage of European economic
and monetary union, and as defined in Article 2 of Council Regulation (EC) 974/98 of 3 May 1998 on the
introduction of the Euro, as amended; and
·
references to "LBP" or "Lebanese Pounds" are to the Lebanese Pound, the lawful currency of Lebanon.
Certain figures included in this Prospectus have been subject to rounding adjustments; accordingly, figures shown as
totals in certain tables may not represent an exact arithmetic aggregation of the figures that precede them.
Presentation of Alternative Performance Measures
In this Prospectus, the Bank uses the following metrics in the analysis of its business and financial position, which the
Bank considers to constitute Alternative Performance Measures ("APMs"), as defined in the European Securities and
Market Authority Guidelines on Alternative Performance Measures dated 5 October 2015 (the "ESMA Guidelines").
For further information see "Overview of Financial Information".
iv

Set out below is a summary of the APM metrics used, the definition, bases of calculation and reconciliation of such
metrics and the rationale for the inclusion of such metrics.
Definition, method of calculation and reconciliation
Metric
to financial statement line item
Rationale
Return on average assets
Calculated by dividing profit for the financial period by average
Performance measure
(ROAA)
total assets. Average total assets are computed as the average of
period-beginning and period-ending balances.
Return on average equity
Calculated by dividing profit for the financial period by average
Performance measure
(ROAE)
common Tier 1 capital. Average common Tier 1 capital is
computed as the average of period-beginning and period-ending
balances.
Total interest expense to total
Calculated by dividing total interest and similar expense by total
Performance measure
interest income
interest and similar income.
Net interest income over
Calculated by dividing net interest income by average interest
Performance measure
interest earning assets
earning assets. See "Selected Statistical and Other Data--Average
Balance Sheet and Interest Rates".
Net interest spread
Calculated by deducting average interest rate on average interest
Performance measure
earning assets from average interest rate on average interest
bearing liabilities. See "Selected Statistical and Other Data--
Average Balance Sheet and Interest Rates".
Net interest margin
Calculated by deducting the result of interest and similar income
Performance measure
divided by average total assets from interest and similar expense
divided by average total assets.
Operating expenses to
Calculated by dividing total operating expenses (excluding
Performance measure
operating revenues (cost-to-
depreciation and amortisation) by net operating revenues.
income ratio)
Non-interest income to
Calculated by dividing non-interest income by total operating
Performance measure
operating revenues (before
income (before allocation to provisions).
allocation to provisions)
Non-interest income includes all revenue accounts in the income
statement excluding interest and similar income.
Average net loans to average
Calculated by dividing average net loans and advances to
Liquidity measure
net deposits
customers and related parties at amortised cost by average
customers' and related parties' deposits at amortised cost. Average
net loans to customers and related parties at amortised cost and
average customers' and related parties' deposits at amortised cost
are each computed as the average of period-beginning and period-
ending balances.
Average customers' creditor
Calculated by dividing average deposits from customers and
Liquidity measure
accounts to average total
related parties at amortised cost by average total deposits (the sum
deposits
of due to central banks, due to banks and financial institutions,
customers' deposits at amortised cost and deposits from related
parties at amortised cost). Average deposits from customers and
related parties at amortised cost and average total deposits are each
computed as the average of period-beginning and period-ending
balances.
Foreign currency customers'
Calculated by dividing net loans and advances to customers and
Liquidity measure
loans to foreign currency
related parties in foreign currency by the sum of due to central
customers' creditor accounts
banks, due to banks and financial institutions, customers' deposits
at amortised cost and deposits from related parties at amortised
cost denominated in foreign currency.
Net non-performing loans to
Calculated by dividing net non-performing loans (net of individual
Asset quality measure
total equity
impairment allowances) by total equity.
Loan loss provision to non-
Calculated by dividing the sum of individual impairment
Asset quality measure
performing
allowances and unrealised interest on doubtful loans by the net
loans
non-performing loans (net of individual impairment allowances).
The above APMs have been included in this Prospectus to facilitate a better understanding of the Bank's historic trends
of operation and financial condition. The Bank uses APMs as supplementary information to its IFRS operating results.
See the Financial Statements and the notes thereto. The APMs are not defined by, or presented in accordance with, IFRS.
The APMs are not measurements of the Bank's operating performance under IFRS and should not be considered as
alternatives to any measures of performance under IFRS. In addition, other companies, including those in the Bank's
industry, may calculate similarly titled APMs differently from the Bank. Because companies do not calculate these APMs
v

in the same manner, the Bank's presentation of such APMs may not be comparable to other similarly titled APMs used
by other companies.
vi

INFORMATION FROM PUBLIC SOURCES
Certain information included in the sections "Risk Factors--Risk Factors Relating to Lebanon", "Business" and "The
Banking Sector and Banking Regulation in Lebanon" has been extracted from information and data publicly released by
official sources and other sources that are believed to be reliable, including the Central Bank and Bilanbanques 2017,
which is published by Bankdata Financial Services WLL ("Bankdata"). Throughout this Prospectus, the Bank has also
set forth certain statistics, including market shares, from official sources and other sources it believes to be reliable,
including its own sources and estimates. Such information, data and statistics may be approximations or estimates or use
rounded numbers. The Bank has not independently verified such information, data or statistics, does not guarantee their
accuracy and completeness and accepts no responsibility in respect of such information, data and statistics, other than that
this information has been accurately reproduced and that, accordingly, as far as the Bank is aware and is able to ascertain
from published information, no facts have been omitted that would render the reproduced information inaccurate or
misleading.
Certain statistical and other information relating to the Lebanese banking sector generally and to the Bank's competitive
position in its market and the relative positions of its primary competitors in the sector in particular are generally based
on information made available from Bankdata, Central Bank statistics and the Bank's internal sources. Bankdata numbers
may differ in certain respects from the Bank's own financial statements and from Central Bank statistics.
vii

TABLE OF CONTENTS
Page
IMPORTANT NOTICE ...................................................................................................................................................... i
NOTICE TO LEBANESE INVESTORS ........................................................................................................................... ii
FORWARD-LOOKING STATEMENTS .........................................................................................................................iii
PRESENTATION OF FINANCIAL AND OTHER INFORMATION.............................................................................iii
INFORMATION FROM PUBLIC SOURCES ................................................................................................................ vii
RISK FACTORS ................................................................................................................................................................ 1
OVERVIEW ..................................................................................................................................................................... 15
TERMS AND CONDITIONS OF THE CERTIFICATES............................................................................................... 20
USE OF PROCEEDS ....................................................................................................................................................... 29
CAPITALISATION ......................................................................................................................................................... 30
OVERVIEW OF FINANCIAL INFORMATION............................................................................................................ 31
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS ................................................................................................................................................................. 34
SELECTED STATISTICAL AND OTHER DATA ........................................................................................................ 56
RISK MANAGEMENT ................................................................................................................................................... 71
BUSINESS ....................................................................................................................................................................... 83
MANAGEMENT AND EMPLOYEES ......................................................................................................................... 105
THE BANKING SECTOR AND BANKING REGULATIONS IN LEBANON .......................................................... 118
DESCRIPTION OF THE SHARE CAPITAL OF THE BANK..................................................................................... 135
LEBANESE LAWS AND REGULATIONS GOVERNING ISSUANCE OF CERTIFICATES BY COMMERCIAL
BANKS........................................................................................................................................................................... 141
OVERVIEW OF PROVISIONS RELATING TO THE CERTIFICATES IN GLOBAL FORM................................. 142
TAXATION.................................................................................................................................................................... 144
SUBSCRIPTION AND SALE ....................................................................................................................................... 146
GENERAL INFORMATION......................................................................................................................................... 147
INDEX TO FINANCIAL STATEMENTS ...................................................................................................................F - 1
ANNEX A .................................................................................................................................................................... A - 1

RISK FACTORS
An investment in the Certificates involves a high degree of risk. Potential investors should review this entire Prospectus
carefully and, in particular, should consider, among other things, all risks inherent in making such an investment,
including the risk factors set forth below, before making a decision to invest in the Certificates. These risk factors,
individually or together, could have a material adverse effect on the Bank's ability to repay principal of, and make
payments of interest and other amounts due (including Additional Amounts, as defined in Condition 7) on, the Certificates.
In addition, factors which the Bank believes are material for the purpose of assessing the market risks associated with
the Certificates are also described below. The value of the Certificates could decline due to any of these risks and
prospective investors may lose some or all of their investment. Words and expressions defined in the "Terms and
Conditions of the Certificates" below or elsewhere in this Prospectus have the same meanings in this section.
Risk Factors Relating to Lebanon
The Bank operates primarily in Lebanon and, accordingly, its financial condition, results of operations and business
prospects are closely related to the overall political, social and economic situation in Lebanon, which, in turn, is tied to
the geo-political situation in the region.
Emerging Markets
Investing in securities of issuers in emerging markets, such as Lebanon, generally involves a higher degree of risk than
investments in securities of corporate or sovereign issuers from more developed countries and carries risks that are not
typically associated with mature markets. Lebanon's below investment grade credit ratings, large and growing fiscal
deficits and other weaknesses make the Lebanese economy susceptible to future adverse effects. Prospective investors
should exercise particular care in evaluating the risks involved and must decide for themselves whether, in light of these
and other risks, their investment is appropriate. Generally, an investment in the securities of issuers in emerging markets,
such as Lebanon, is only suitable for sophisticated investors who fully appreciate the significance of the risks involved.
Investors are urged to consult their own legal and financial advisers before making an investment in the Certificates.
Political and Economic Considerations
Lebanon's financial environment is related to the overall political, social and economic situation in Lebanon and to a
lesser extent in its neighbouring countries, as well as internal stability.
A combination of internal and external factors led to a heavily militarised conflict, which lasted from April 1975 until
October 1990. Successive rounds of fighting took place, aggravated by two Israeli military invasions in 1978 and 1982.
The conflict resulted in significant human losses, a substantial decline in GDP and reduction of economic activity, a
significant reduction of the authority of the Government of the Lebanese Republic, substantial physical and infrastructure
damage, and a large public sector deficit and capital outflows.
The post-conflict era has been characterised by large reconstruction efforts, which resulted in large public sector deficits
and setbacks in the implementation of political and economic reforms due, among other matters, to differences in views
between political leaders and disagreements within the executive branch of the Government. The post-conflict era has
also witnessed a series of adverse events, which have led to significant political and social unrest and negatively affected,
and may continue to negatively affect, the Lebanese economy and the finances of the Government, including, inter alia:
·
political assassinations and attempted assassinations of political leaders and public figures, including the
assassinations of former Prime Minister Rafik Hariri in 2005 and other prominent individuals;
·
armed conflicts involving Lebanon's neighbours, including the ongoing armed conflicts in Syria and the war in
July 2006 during which Israel waged war on Lebanon following the kidnapping by Hezbollah of two Israeli
soldiers (the "July 2006 War");
·
internal armed clashes, which took place in Beirut, northern Lebanon, the Beka'a Valley and the Chouf Mountains
in May 2008, and subsequent clashes in Tripoli and elsewhere in Lebanon;
·
various instances of political instability, such as delays in electing a President, the resignations of ministers, the
failure of Parliament to convene and delays in forming governments; and
·
popular protests, demonstrations and general unrest.
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