BEIRUT (Reuters) - Lebanon’s Banking Control Commission will evaluate which banks met targets for boosting their capital and liquidity, the central bank governor said on Monday, after the expiry of a deadline for them to do so.
The banking sector is at the heart of Lebanon’s financial crisis that erupted in late 2019, with banks largely freezing customers out of their dollar deposits and blocking transfers abroad since then.
Governor Riad Salameh told Reuters banks that did not meet the capital and liquidity targets he set out last year would be deferred to the central bank’s higher banking commission to take “appropriate decisions”.
He did not say how many banks had managed to raise their capital by 20% and their liquidity with corresponding banks to 3% of foreign currency deposits.
“The Capital Markets Authority is auditing the impact of marketing preferred shares and subordinate debt to individual customers,” he added.
Last year’s central bank circulars had also asked banks to urge their large depositors to repatriate 15-30% of funds transferred abroad in recent years.
The central bank said earlier on Monday it would create a “roadmap” which Salameh said would determine which banks had met the requirements and what to do with those that had not.
Reuters’ reporting last month showed a number of banks were struggling to meet the targets.
Salameh had warned last year that those failing to meet the capital target would have to leave the market.
Reporting by Ellen Francis and Laila Bassam; Editing by Alex Richardson
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