WATCH LEBANON CLOSELY FOR INCREASED COUNTRY RISK

Skirmishes between Lebanese military forces and radical Islamist groups operating in Syria, when added to increased posturing by Hezbollah threatening a new war against Israel, bears watching, for Country Risk purposes. Beirut's financial center could be vulnerable to terrorist attacks, by radical groups fighting in adjacent areas, as well as from Israel's stated intention to cause widespread damage to Lebanon, should it permit Hezbollah to attack it again.

Compliance officers charged with updating Country Risk assessments should keep a close watch on unfolding events in Lebanon, especially if their bank, has financial exposure there, or if bank clients have substantial ongoing international trade transactions in Beirut.