US EditionLebanese Cabinet approves a draft law to return funds wiped out with the 2019 collapse of banks
The draft law aims to return full deposits to 85% of depositors within four years and convert large claims into bonds backed by $50 billion in central bank assets.
- On Friday, Lebanon's Cabinet approved a draft 'financial gap law' to determine losses from the 2019 banking collapse and return depositors' funds.
- Years of corruption and alleged bank malpractice contributed to the 2019 collapse, as Lebanese currency lost over 90% of its value, pushing over half the population into poverty.
- Prime Minister Nawaf Salam said the draft sets repayment rules: smaller depositors, who comprise 85%, get full repayment over four years, while larger depositors receive up to $100,000 in cash first and bonds backed by Central Bank's revenues and assets around $50 billion.
- The draft still needs parliamentary approval and may face delays as protesters staged a sit-in outside government headquarters expressing skepticism.
- The move addresses long-standing IMF demands by including deposit return rules and liability restructuring, amid World Bank estimates of about $11 billion for reconstruction and allegations against Riad Salameh, former central bank governor.
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The text, which must be forwarded to Parliament, protects savers holding less than $100,000 at the bank. Its adoption was a requirement of the international community.
Associated Press News
Lebanese Cabinet approves a draft law to return funds wiped out with the 2019 collapse of banks
Lebanon’s Cabinet has approved a draft law to determine the extent of losses suffered by Lebanese banks during the country’s financial meltdown in 2019 and provide a mechanism to return depositors’ funds that were wiped out at the time.
This article was originally published on Cedarnews.net. For more news and exclusive reports, visit our website. The National News Agency reported that the Cabinet session concluded with the approval of the draft Financial Regulation Law. The draft law was approved by 13 ministers and opposed by 9. This news was published on the Cedarnews news website. For more breaking news and exclusive reports, visit our official website.
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