Armed with deep pools of liquidity, many Middle Eastern banks are exploring new avenues of growth, from expanding their regional presence to concentrating on innovation within the Islamic finance sphere.

Having endured an eventful recent past that includes a civil war, involvement in Middle East disputes and weathering the crisis in neighbouring Syria, Lebanon’s robust financial sector is growing at what the industry believes is a healthy pace. And with its banks highly liquid and well placed for the implementation of Basel III, good economic growth is forecast for 2012.

The Lebanese banking sector witnessed slow growth in the first half of 2011, as political paralysis gripped the entire economy. The re-election of Riad Salameh as central bank governor helped boost activity in the latter half of the year, but with the country's political situation and the global economic climate still threatening to trouble Lebanese banks, how does he intend to stimulate growth throughout 2012?

The governor of Banque du Liban's conservative approach has set Lebanon on a firm post-crisis footing, and has enabled the country's banking sector to ride out the 'Arab Spring' uprisings in the Middle East and north Africa with relative ease.

Riad Salameh, governor of the Banque du Liban, tells The Banker  how the country's banks have been unaffected by the turbulence in the Middle East and north Africa, and explains why they have been performing so well of late.

The conservative approach adopted by Lebanon's largely family-owned banking sector over the past decade has served it well in the post-crisis environment. Now its key players are increasingly eyeing an expansion into the frontier markets of eastern Europe, the Middle East and Africa. 

The collapse of its government earlier this year and subsequent political wrangling, together with less than optimistic trading figures, has left many fearing for the economic future of Lebanon. But the region has a long history of resilience in the face of adversity.

Lebanon's minister of finance, Raya Haffar Al Hassanm, only took office last November but is already making inroads on attracting private investors to the region and tackling structural economic deficiencies. Writer Daniel Maalo