The Central Bank of Lebanon announced that it will start selling dollars to commercial banks “based on the exchange rate announced on the electronic platform for exchange operations.
And the Central Bank said in a statement today, Thursday, that it will also allow depositors to convert the Lebanese pound that they withdraw from their dollar deposits into dollars also at the exchange rate.
Depositors have not been able to access their dollar accounts since the financial crisis erupted in Lebanon in late 2019, and they can only withdraw in Lebanese pounds at a fixed rate.
The Lebanese Deputy Prime Minister, His Excellency Al-Shami, said last Tuesday that Lebanese officials agreed to estimate the size of the financial sector losses in the country at between 68 and 69 billion dollars, but he cautioned that the figure is based on some assumptions that may change.
Agreement on the extent of the losses is a necessary first step for the Lebanese government as it seeks to negotiate a support program from the International Monetary Fund.
Al-Shami added that the figures are based on “some assumptions… and if those assumptions change, the size of the losses will change as well.” He declined to go into further details.
Disagreements over the extent of losses between Lebanon’s central bank, commercial banks and the government last year led to the collapse of negotiations for an International Monetary Fund support program seen as necessary to begin to pull Lebanon out of its worst crisis since the 1975-90 civil war.
The figure, between $68 billion and $69 billion, is the same as the total estimate the government gave at the time. Prime Minister Najib Mikati said he is seeking to sign a memorandum of understanding with the International Monetary Fund by the end of the year.