Assessment of Fransabank performance in Algeria : current and future prospects

Abstract

Looking for business opportunities outside the Lebanese borders goes back to hundreds of years ago. Lebanese individuals used to travel for trading and working abroad. Most of them have succeeded and many have made remarkable achievements despite the difficulties in the means of transportation, communication, security With Globalization, openness of International markets and the new technologies investments across borders became easier. During the last few years the Lebanese banking sector is attempting to expand abroad for many reasons, including the scarcity of investment opportunities in Lebanon, the great opportunities in the Arab world to increase profitability and the benefit of the Lebanese know- how in banking. Also to follow and serve the clients who moved from Lebanon. Fransabank SAL was among the Lebanese banks who decided to expand in the Middle East and North Africa countries. While some Lebanese banks were not in favor of investing in Algeria being a high risk country in terms of security, political violation and regulations. In their opinion Investment should be directed towards the rich countries in the Gulf region (Dubai, Qatar...) where risks are lower and regulations are less. One of Fransabank targets was Algeria, the energy rich country with a population of 33 million inhabitants which is scarcely provided with banking services and over 330,000.- small and medium enterprises (SMEs) have till now a limited access to credit and modern banking services. Taking the initiative to establish a Fransabank subsidiary in Algeria was a challenge considering the different environment, culture, risks... which are important factors that might lead to losing the business. The objectives of this thesis are the study of the Investment climate in Algeria, the risks, rewards and the challenges of investing in Algeria and to assess the performance of Fransabank, the first Lebanese bank that started its operations in Algeria. In this Thesis I have tried to determine whether Fransabank strategy of entering the Algerian market was accurate, was it in the right time, what could Fransabank do to enhance performance, what are the rewards from this investment I have applied and compared the theories in intercultural management, strategy, International marketing, international human resources management, I have learned in the MBA-MIB program with practical implementation. I have also tried to reveal that Lebanese banks have to expand abroad based on their solid performance, financial and human resources capabilities. The contents of this Thesis are the result of researches (Books, professional journals, internet, specialized magazines...) notes, observations, interviews and information collected during my cite visit to Algeria.