BEIRUT: Central Bank Governor Riad Salameh said Tuesday that the majority of the Lebanese banks have succeeded in increasing their capital.

A big majority of the banks complied with Circular 154, Salameh told The Daily Star.

But the governor did not give further details or say how many banks have actually complied with the circular.

Once all reports of the Banking Control Commission are ready and communicated we will issue an official statement, Salameh added.

BDL issued on Aug. 27, 2020, Basic Circular 154 that details the exceptional measures that banks operating in Lebanon have to take.

It requested banks to conduct a proper valuation of their assets and liabilities in order for them to be able to meet all capitalization, solvency and liquidity requirements, as well as to resume regular business activities and banking operations.

The circular stipulated that, in order to boost the banks' liquidity profiles, especially at their foreign corresponding banks, Lebanese banks should encourage customers who transferred abroad the equivalent of $500,000 or more since July 2017, to deposit the equivalent of 15 percent of the transferred amount in a "special account" with a term maturity of five years.

Also, it asked banks to encourage importers to transfer from abroad the equivalent of 15 percent of the aggregate amount of letters of credit that they opened in any of the past four years, and to place these funds in a "special account," and block them for five years.

In addition, the circular asked banks chairmen, members of the board of directors, major shareholders and senior executives, as well as customers that are identified as "politically exposed persons" and who transferred abroad more than $500,000 or its equivalent in other foreign currencies since July 2017, to deposit 30 percent of such funds and block them for five years.

It said that the amounts deposited into the "special accounts" would be exempt from reserve requirements and from mandatory placements at BDL.

BDL also stressed that after Feb. 28, banks must send all their data to the Banking Control Commission, which in turn checks them and sends the relevant reports to the Central Bank.

Copyright 2021, The Daily Star. All rights reserved. Provided by SyndiGate Media Inc. (Syndigate.info).

Disclaimer: The content of this article is syndicated or provided to this website from an external third party provider. We are not responsible for, and do not control, such external websites, entities, applications or media publishers. The body of the text is provided on an as is and as available basis and has not been edited in any way. Neither we nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this article. Read our full disclaimer policy here.