Evolution of the Lebanese banking sector legitimacy in view of the pressure of the United States Regulations
PDF (English)

Comment citer

NASSAR, D. (2020). Evolution of the Lebanese banking sector legitimacy in view of the pressure of the United States Regulations. Proche-Orient Études En Management, 32(1), 105-129. Consulté à l’adresse https://journals.usj.edu.lb/poem/article/view/415

Résumé

In the recent years, many international banks have been fined because of
violations of US regulations. Also, their legitimacy was challenged, and questions
were raised about the strategic responses adopted by these banks to restore their
legitimacy. In Lebanon, the collapse of the Lebanese Canadian Bank (LCB) due
to non-compliance with US regulations has shaken the whole banking industry
whose legitimacy has been affected, in addition to the compliance measures
taken by this sector in face of the mounting pressure of the US Legitimacy,
a major concept of the neo institutional theory is crucial for the survival of
organizations. This article postulates that the Lebanese banking sector is on
continuous quest for the legitimacy of the US regulator on which it is dependent
to survive. Thus, the aim of this paper is to explore how the Lebanese banking
sector’s legitimacy has evolved over time in view of the pressure of the US, by
addressing the following question: How the US regulations affect the perception
of the Lebanese banking sector legitimacy? Towards achieving this objective, this
paper utilizes a retrospective longitudinal design and undertakes a qualitative
content analysis of archival data from 1997 to 2018. Our findings revealed that
legitimacy in the Lebanese context has passed from a cognitive legitimacy
conferred by a domestic regulator before LCB to a more “pragmatic” one that is
conferred by a foreign regulator after LCB.

PDF (English)