| Future of banking ‘lies in set-up for
electronic transactions’ Arab banks
need to invest more in technology and electronic transactions infrastructure to achieve
higher growth, bankers said Wednesday.
The bankers, who were addressing a seminar entitled “The Electronic Revolution and
Risk Management in the Banking Sector,” said that Arab banks have yet to catch up
with technological progress in the West and other parts of the world.
The second vice-governor of the Central Bank, Fahim Modad, told those gathered at the
Bristol Hotel for the seminar that the financial crisis in the United States in 1987 was
due to the misuse of electronic transactions.
He added this crisis motivated all countries and financial institutions to hammer out new
laws on improved electronic payment systems.
“We are currently focusing on the financial risks in electronic systems,” Modad
said, adding that the Central Bank wants to develop a secure system for electronic
transactions.
The vice-governor said that the Swiss-based Basle Committee for financial securities had
made many recommendations on electronic banking risk management. He added that banks in
Lebanon have been instructed to equip their institutions with advanced supervision
networks, especially those related to electronic payment systems.
The Basle Committee has also recommended that each bank and financial institution assess
the risk of each client and urged banks to abide by the laws of Central Banks that are
aimed at protecting clients.
The Central Bank in Lebanon has passed a number of laws and decrees since 1999 to ensure
the safe use of electronic payments.
It also stipulated that any bank seeking to open a branch in the country must link
electronically with the rest of the branches.
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