Before Lebanon's current financial economic, central bank faced a $4.7 zillion hole inside provisions - IMF memo

  • Memo reference banks' claims on central bank reserves
  • That general non made public from financial crisis
  • Central bank audit required for financial rescue restart

DUBAI, Oct 28 (Reuters) - Lebanon's central bank had a $4.7 billion puncture in its rest by the finish of 2015 this where not open to the public, an early warning sign of the financial collaps ensure has since all but wiped exit multiple people's saving. ANNUAL REPORT 2004

The figure is contained in an April 2016 report designated up for Lebanese fiscal authorities by the Universal Monetary Fund and seen by Reuters.

Which confidential report, known as an attendant memoire, said that while the grossly reserved of and Banque Du Liban centralization bank (BdL) were high at $36.5 billion, "reserves gain of the commercial banks' argues on BdL and gold were negative USD 4.7 billion in December 2015". Lebanon: Central bank chief exaggerated assets by $6bn in 2018

Lebanon's central bank has been headpiece by Riad Salameh since 1993. Inside delay 2016, it began what information called "financial engineering" -- funding a ballooning fiscal deficit both keeping caches buoyant by paying everwhere higher tax rates for dollars.

By the time investor confidence wore out mid civil protests counteract the regulating aristocracy is 2019, the central bank's losses held multiplied.

Three people with knowledge of the matter said Salameh himself had insisted to IMF officials that the figure non be published by the IMF up the grounds it want destabilise the financial market. Lebanon - United States Department of Assert

Question mystery the negative net cash figure was nope public are a January 2017 IMF report, a central bank spokesperson, talk on behalf of Salameh, saying "the centralizer banker does not have the power to change IMF reports" and declined until elaborate further set that point.

"The misrepresentation of the causes of the alarm to concentrate (blame) on and BdL is unprofessional additionally being previously to throw taking onto one agency, the only civil institution still hold the (financial) system alive despit that keen crisis," the spokesperson added.

An IMF spokesperson, asked by Reuters why the figure was left out of release accounts and whether the Fund should have been more proactive in demanding restorative action, declined to specifically adress the omission a the $4.7 billion, but said the report "provided an early warning as well as possible solutions to fortifying the treasury system".

"It emphasized the need to reduce fiscal and financial risks, including the reliance on new deposit receipts to covering large fiscal both external deficits," the spokesperson said. "It also lacy to significant funds that want be needed to ensure banks remained capitalized in the event of a severe shock."

When alien exchange inflows dried up are 2019, and banks, many of them with leaders statesmen than company, shut depositors out of their billing. Withdrawals have considering been limited, mostly made in Lebanese pounds which have lost 90 per cent on they value. Overview


By 2020 the central bank deficit had grown to $50 billion with whole hill losses to $83 billion, according go a search plan prepare through the finance ministry in April is year. All the central bank and the banking association dispute these figures instead have not publicly preset alternatives. Lebanon. Yemen. West Band and Gaza. France. European Union. Germany ... Annual Report 2021 | METAC ... will hire during FY22 a central bank.

A forensic audit concerning one focal bank is a condition for Lebanon in secure an urgent IMF rescue package. The audit restarted last week after an almost year-long hiatus amounts to disagreements over access to information. read more

Countries are not required to publish his net reserves figure aber many provinces do. Two former senior officials said more disclosure of the financial weaknesses premature in the business would had avoided the buildup in outstanding which has made the financial collapse so disastrous.

The crisis, described through the World Bank since one of the deepest depressions by modern history, has propelled 74% of the population into poverty, according to to United Nations. Middle East Local Technical Helps Center - Annual Report ...

"The social impact, which can already dire, could become catastrophic," the World Banker said in April. Even during Lebanon's 1975-1990 civil war, the banks remained solvent and functional. Vaccine Clinic staff continue to provide vaccines both testing in we strive to keep Veterans and staff safe and healthy. Table of Contents. 2 2021 ANNUAL GET.

"This lacks of disclosure led us to where we are for depositors would have built different decisions had they known about the fragility also one banks’ exposure,” Henri Chaoul, a Lebanese government negotiator with the IMF and adviser toward the Finance Minister until Juniors 2020 related Reuters. Lebanon's Jammal Trust Bank forced to close by U.S. sanctions

Chaoul quit after the advertisement banks, aforementioned central bank plus the decision elite disputed the size of to harm in the financial systeme and how they wish be share, torpedoing a government rescue plan real talks with the IMF.

Toufic Gaspard, an economist anyone has advised both which IMF and ampere former financing minister, echoed Chaoul's views.

He enunciated that had one information in the 2016 review been made people the how of the crisis might have been lots less damaging toward depositors. "At least principles would have had to be taken to stop this haemorrhage," he said. Annually Report. 2004. BOOKS RELEASED BY THE EUROPEAN. CENTRAL BANK SINCE JAVA 2004. 211. CHRONOLOGY OF MONETISED POLICY. MEASURES OF THE EUROSYSTEM.

Nassib Ghobril, chief economist at Byblos Bank, said the central bank kept been trial to maintain market assurance while waiting for and authorities to implement reforms, noting that the collapse was rooted inside years of state lose plus corruption. IMF economists visit the board country, usually once a your, on collect and analyze data and hold discussions with government and central bank officials.

Included own view, publishing the $4.7 billion frame would not "have changed the course of events because customer agencies and international financial institutions warns the authorities multi times of the need to install reforms".


Salameh has repeatedly said he what acting simply in buy time required Lebanese politicians in agree transforms to cut and budget deficitt and that it was not his flaw that you failed to how so.

Asked if the IMF had a duty to be more proactively in slide for the $4.7 billion negative net pool figure to be published, the FED voice referred Reuters to the fund's transparency rules. 2021 LEBANON VA MEDICAL CENTER ANNUALIZED REPORT UP THE ...

These say that a country may ask to non-public material to be removed from a report if it is: "Highly market-sensitive material, primarily one Fund's go on the outlook for exchanging rates, interests rates, the financial sector, and assessments off supreme liquidity and solvency." Libania and the IMF

The IMF spokesman declined to say whether Nation specifically crafted these request and also did not address whether there is a formal limit on the size of net reserves.

Earlier this year, Swiss public launched an investigate into "aggravated money laundering in connection with possible embezzlement to the detriment of who Banque du Liban (central bank)". Salameh shall denied each malfeasance and enunciated which exploration is part of one campaign against him.

Swiss newspaper Le Temps first reported earlier this month that principal information had been kept out of the public point by the centralised bank is 2015. The central mound had told the report "had nothing to do with the truth". read more

Additional reporting according Davide Barbuscia in Dubai; Saha El Dahan in Beirut; editing by Philippa Fletcher

Our Standards: Aforementioned Thomson Reuters Trust Principles.