Lebanese banking commission to assess whether lenders have met capital target – governor

FILE PHOTO: A view shows the Central Bank of Lebanon building in Beirut, Lebanon February 10, 2021. REUTERS / Mohamed Azakir

BEIRUT (Reuters) – The Lebanese Banking Supervision Commission will assess which banks have met their targets for strengthening their capital and liquidity, the central bank governor said on Monday, after a deadline expired for let them do it.

The banking sector is at the heart of Lebanon’s financial crisis that erupted in late 2019, with banks largely freezing customers of their dollar deposits and blocking overseas transfers since then.

Governor Riad Salameh told Reuters that banks that fail to meet the capital and liquidity targets he set last year would be referred to the central bank’s top banking commission to take “the wrongs.” appropriate decisions ”.

He did not specify how many banks had managed to increase their capital by 20% and their liquidity with correspondent banks to 3% of foreign currency deposits.

“The Capital Markets Authority verifies the impact of the marketing of preferred shares and subordinated debt to individual clients,” he added.

Last year’s central bank circulars also called on banks to urge their large depositors to repatriate 15-30% of funds transferred overseas in recent years.

The central bank said earlier Monday that it would create a “road map” that Salameh said would determine which banks have met the requirements and what to do with those that have not.

Reuters reports last month showed a number of banks were struggling to meet targets.

Salameh had warned last year that those who fail to meet the capital target would have to exit the market.

Reporting by Ellen Francis and Laila Bassam; Editing by Alex Richardson

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