BEIRUT, Lebanon  - Lebanon is seeing an unexpected bonus at a time when jitters zip through the global financial sector - apparently unscathed by the turmoil, its banks are flush with cash, increasing their net profits and even attracting new depositors.

Some say the three decades of military and political turbulence have become a blessing in disguise, shielding Lebanese banks from the fallout of the worldwide financial crisis.

Others say it's just prudent strategy and solid banking tradition.

"Lebanon will not be affected by the international financial crisis because the Central Bank has put in place the needed control for giving credit," Central Bank Governor Riad Salameh said this week.

Strict rules imposed by the Central Bank over the years prevented local banks from investing in derivatives and housing loans abroad - considered the main reasons behind the current crisis - and have kept the global meltdown effects minimal in Lebanon.

Many of Lebanon's more than 60 banks are family owned and have shied away from big investments in international markets. Instead, they have focused on lending billions of dollars to the government in Beirut at higher interest rates than the U.S. market.

A decades-old banking secrecy that bans banks from disclosing their depositors continues to attract clients from around the Arab Middle East, who value the guaranteed protection.

Also, most Lebanese traditionally save rather than invest in risky stocks and this has also kept money in the banks.

"Most of the people in Lebanon put their money as deposits in banks, unlike sophisticated clients abroad who invest their money in different ways," said Fadi Mubarak, head of the treasury at Credit Bank. "Some banks also have 30 or 40 percent liquidity of its deposits and for that reason the banks were not directly affected by the crisis."

Not only has this kept Lebanon's banks safely afloat during the current crisis, but the country's banks are even attracting a few people to bring their deposits from abroad to Lebanon, Mubarak told The Associated Press. Some banks also have brought money to Lebanon that had been deposited previously in foreign institutions.

Lebanon's banking system has belied the country's political instability, high national debt and chronic state budget deficits. It survived the 1975-90 civil war, frequent political crises and tensions with Israel.

Salameh, the central bank's governor and the man behind the banking sector's strict rules, says that in order to guarantee stability, the Central Bank based its strategy on what is known in the banking world as the Basel II protocol - a set of recommended rules covering capital requirements for banks - and kept high liquidity in banks' balance sheets.

He said these measures allowed banks to have a third of their $90 billion balance sheet liquid.

Assets of private banks have topped $100 billion, nearly four times the gross domestic product. Foreign currency assets in the Central Bank have risen steadily to nearly $20 billion, and the 9.2 million ounces of gold the Central Bank has are now valued at more than $6.9 billion.

Freddie Baz, chief financial officer of Bank Audi, one of Lebanon's leading banks, said this month that the international crisis has had a minor impact on the Lebanese banking sector.

Bank Audi lost no more than 20 million, or 0.1 percent of the bank's deposits - those invested with the bankrupt U.S. brokerage firm Lehman Brothers Holdings Inc., he said.

Baz told the leading An-Nahar newspaper that deposits in Lebanese banks have increased $9 billion in the first nine months of 2008. That's a record, and significantly higher than average annual increases between $2 billion and $6 billion in recent years.

Profits of top Lebanese banks are also on the rise.

Bank Audi announced in October it had made $180.6 million in net profit in the first nine months of 2008, a 28.7 percent increase over the same period a year ago. Another top institution, Blom Bank, said its profits rose to $198 million in the same period, a 34 percent rise compared to the same period in 2007.

"Lebanon may not have not been considered as the best and safest financial haven," said Baz, of Bank Audi. "But it's now viewed as the last resort." -AP