Overview

Introduction
Introduction
Founded in 1830, the Bank was incorporated in its present form in 1962 as a private joint stock company with limited liability (société anonyme libanaise) with a duration of 99 years. The Bank is registered on the Beirut Commercial Registry under number 11347 and on the Lebanese List of Banks under number 56. In January 2014, the name of the Bank was changed from Bank Audi S.A.L. – Audi Saradar Group to Bank Audi S.A.L.

The initial shareholders of the Bank were members of the Audi family, together with certain Kuwaiti investors. Since 1983, the shareholder base has expanded and currently is comprised of more than 1,500 holders of Common Shares and Global Depositary Receipts (representing Common Shares). The Global Depositary Receipts evidencing the Common Shares are listed on both the Beirut Stock Exchange and the London Stock Exchange and the Bank’s Common Shares are listed on the Beirut Stock Exchange.

The Bank’s head office and registered address is Bank Audi Plaza, Omar Daouk Street, Bab Idriss, Beirut 2021 8102, P.O. Box: 11-2560, Beirut, Lebanon.

The Bank is a regional Bank. It operates principally in Lebanon, the MENA region and, since November 1, 2012, in Turkey, offering a full range of products and services that principally cover commercial and corporate banking, retail and personal banking and private banking, as well as ancillary activities such as investment banking and factoring. As at end-June 2017, the Bank ranked first among Lebanese banks in terms of total assets (LL 66,136 billion), shareholders’ equity (LL 5,761 billion), customers’ deposits (LL 54,747 billion), loans and advances (LL 26,583 billion) and net profits in the first half of 2017 (LL 464 billion). In addition to its historic presence in Lebanon, Switzerland and France, the Group currently operates in Jordan, Egypt, Saudi Arabia, Qatar, Abu Dhabi (through a representative office), Monaco, Turkey and Iraq.

As at end-June 2017, the Bank had one of the largest branch networks in Lebanon, with 83 branches (78 operating) covering the Greater Beirut area and other strategic regions in Lebanon, as well as, through its foreign subsidiaries, a network of 120 branches in the MENAT region (outside of Lebanon), including 15 branches in Jordan, 45 in Egypt and 52 branches in Turkey. The Bank has two subsidiaries in Lebanon, two subsidiaries in Europe, as well as an asset management company in Monaco, four subsidiaries in the MENA region outside Lebanon and a subsidiary in Turkey.

Since 2005, the Bank has undertaken significant regional expansion and has the fourth largest coverage among the top 15 Arab banking institutions in the MENA region with operations in 10 countries, excluding Lebanon, through a network of branches and subsidiaries developed mainly through green-field operations. As a result of this regional expansion, an increasing percentage of the Bank’s assets are contributed by its operations outside Lebanon. Management intends to continue to seek growth opportunities both in Lebanon and abroad over the medium term.

As at end-June 2017, the Bank and its consolidated subsidiaries had 7,062 employees, including 3,283 persons employed in Lebanon, 1,669 persons employed at Odea Bank in Turkey and 1,466 persons employed at Bank Audi Egypt.
Principal Business Activities
Principal Business Activities

Corporate & Commercial Banking

The Bank has a strong commercial and corporate banking franchise with a diversified loan portfolio covering corporate clients in Lebanon, Turkey, the MENA region, Africa and Europe. Credit facilities are booked/managed at the levels of its headquarters in Lebanon and its subsidiaries in Turkey, Egypt, Jordan, Saudi Arabia, Qatar, France, Switzerland and Iraq. The Bank offers a wide range of traditional banking products and services to SMEs, as well as to larger corporate clients. These products and services generate both interest and fee-based income, with a focus on granting working capital and other loan products, providing services in areas such as collection, trade finance, performance bonds, guarantees, letters of credit and cash management, advising on international trade, providing correspondent banking and financial consulting services and preparing feasibility studies across a broad spectrum of industry sectors. As at June 2017, the Bank had a consolidated corporate loan portfolio of LBP 19,253 million (US$ 12,772 billion), and the largest corporate loan portfolio among Lebanese banks.


Retail Banking

The Bank offers a full range of retail products and services, including conventional checking and savings accounts, fixed-term deposits, loans and residential mortgages, credit cards, bancassurance products, internet and mobile banking, as well as a host of innovative retail products and services developed in association with leading partners.
As at December 31, 2016, the Bank offered more than 150 retail products and services to more than 1.5 million retail clients inside and outside of Lebanon. Retail banking activity is supported by the Group’s more than 470 advanced ATMs and more than 190 branches.
The Bank’s dynamic customer-focus approach, which aims at enhancing the customer penetration rate with existing products in addition to enlarging the core product offering with the launch of new products, translated into the Bank’s cross-selling activities to a total of 4.4 products per customer as at December 2016.
Consolidated loans in the retail banking segment, when consolidated in US$, grew by 1.4% as at March 31, 2017.

Private Banking

Bank Audi Private Bankis the wealth management arm of Audi Group. It operates through three main booking centers based in Switzerland, Lebanon and Saudi Arabia, with offices in Monaco, Qatar, Jordan and the United Arab Emirates. Deep-rooted in the Middle East and North Africa (MENA) region, Bank Audi Private Bank’s leading position sets its apart from its peers and is of significant value for clients seeking investment knowledge and expertise in the region.
The Private Bank has a committed and long-standing history of serving its ever-growing client base since 1976, the year Banque Audi (Suisse) sa was established in Switzerland.
The Bank adopted the Group’s corporate governance and values which have been and will remain a cornerstone of its expansion and modernization. It recognizes the importance of sound Corporate Governance for business success and has therefore established a set of guidelines to increase its long-term value.
Bank Audi Private Bank offers a full and diversified range of services to high net worth clients, with full access to major markets worldwide and global investment products, including discretionary portfolio management, investment advisory, trade execution in all asset classes, Lombard credit, and other private banking services such as estate planning, fiduciary deposits, safe custody and credit cards.
As at June 30th, 2017, on a consolidated basis, the Bank had assets under management, custody accounts and fiduciary deposits of LL 16,754 billion (USD 11,114 million).


Investment Banking & Capital Markets

The Bank offers capital markets and investment banking products and services, while leveraging its regional presence to further develop its securities trading and brokerage platform, consolidating the business towards increased intra-group synergies.
Since 1996, the Bank has developed a substantial capital markets franchise. In Lebanon, the Bank is a market maker on the Beirut Stock Exchange with a 27% market share of trading volumes by value, as at December 31, 2016. The Bank also has a significant share of the Government Eurobond and Treasury Bills markets, with an annual trading volume exceeding U.S.$12 billion in 2016. Within MENA, the bank is active in the equities market, with a particular focus on Saudi Arabia and Egypt, and has a presence in the regions’ fixed income markets. The Institutional Coverage desk, established in 2012, continues to develop new and existing relationships with global non-bank financial institutions in order to cater to international appetite for higher yielding instruments. This activity is reinforced by the Bank’s extensive regional macro, sector and markets research coverage business.
In line with the Bank’s expansion strategy capital markets has extended client and product coverage to offer corporate clients more sophisticated FX hedging products to mitigate their currency and interest rate exposures.
In June 2017, on a consolidated basis, the Bank’s investment banking and capital markets activities generated total income of LL 301 billion (U.S.$ 200 million) as compared to LL 410 billion (U.S.$272 million) in June 2016.


Competitive Strengths

As a result of the Bank’s restructuring and expansion program, which has been on-going since 2005, the Bank has significantly reinforced its presence in Lebanon, throughout the MENA region and in Turkey, as well as diversified the range of its products and services to cover all the activities traditionally carried out by a universal bank. In particular, the Bank believes that it benefits from:
  • a strong franchise in commercial banking activities, with a diversified loan portfolio, including borrowers comprising leading enterprises in Lebanon, as well as a number of leading corporates from the MENA region and Turkey;
  • a strong franchise in retail banking, with a full range of retail products and services offered in the countries in which the Bank has retail banking operations;
  • a leading position in private banking, servicing the needs of high net-worth individuals through its subsidiaries in Switzerland, Monaco, Lebanon, Qatar and Saudi Arabia and its representative office in the United Arab Emirates;
  • a leading position in domestic and regional capital markets activities;
Strategy
Strategy


Through its strategy and recent growth, as a result of a vast regional expansion ongoing since 2005, Bank Audi has stepped into the close circle of the largest and most diversified banking groups in the MENA region, delivering added value to all its stakeholders. That is how over a span of 10 years, Bank Audi’s profile was deeply transformed, to benefit today from the following competitive edges:

  • A strong franchise covering Commercial and Corporate Banking, Retail Banking, Private Banking and Capital Markets activities, and a well-known profile throughout the MENA region.
  • A strong diversification of operations by geography, with a presence in 11 countries through 10 banks and 3 financial companies in the MENA region, in Europe, and in Turkey.
  • A leading position in its main markets of presence, ranking as the largest banking group in Lebanon, the 7th largest in Egypt and the 9th in Turkey, as well as maintaining a leading position in Private Banking in the MENA region, with more than USD 11 billion in assets under management.
  • An experienced risk management team, with a focus on risk governance and a number of risk management committees at the Board and Senior Management levels, which support the determination and monitoring of the Group’s risk philosophy and appetite.
  • Strong Corporate Governance and transparency structures and practices, which have been recognised among the best in the region.
  • A diversified shareholder base which includes historical shareholders, international institutional investors, and individuals from the region.
Given the persisting challenging environment across the region, Management’s current short-term development strategy is based around consolidating and reinforcing the credit profile and positioning of its key entities in Lebanon, Egypt, Turkey, along with the development of the Private Banking activities, while maintaining the network ready to capture growth opportunities as soon as they arise.

  • In Lebanon – As Lebanon will remain a pivotal part of the Group’s overall activity, the Bank seeks to further reinforce and consolidate its leading position on the local market while increasing penetration in the corporate, SME and retail segments.
  • In Egypt – The Bank will continue to build a resilient and well-regarded franchise in Egypt.
  • In Turkey – Odea Bank aims to establish a well-fenced banking platform while improving efficiency and profitability.
  • At the level of Private Banking activities – The Bank looks to leverage solid expertise in Private Banking by reinforcing synergies across entities in Europe, the Near-East and the GCC.
In achieving those objectives, Management expects to deliver quality growth by efficiently meeting the needs of both businesses and individuals in the various countries of presence, and ensuring long-term sustainable value to all stakeholders. As the regional uncertainties alleviate, the Group is expected to resume the diversification and expansion strategy. Bank Audi’s key target in the longer run remains to further develop as a fully-integrated, pan-regional group dedicated to catering to a highly diversified client base among corporates and individuals.
MembersCorporate/Commercial BankingPrivate BankingRetail/Personal BankingTreasury/Capital Markets ActivitiesOnline BrokerageFactoring
Lebanon          
Bank Audi sal
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Audi Investment Bank sal
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Audi Private Bank sal
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Solifac
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Europe          
Banque Audi (Suisse) sa
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Bank Audi France sa
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Audi Capital Gestion sam
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Turkey          
Odea Bank A.Ṣ.
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Middle East and North Africa          
Bank Audi sal - Jordan Branches
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Bank Audi sae (Egypt)
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Bank Audi LLC
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Bank Audi sal - Abu Dhabi Representative Office
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