The headquarters of the Banque du Liban (BDL) in Beirut. (Credit: Joao Sousa/L'Orient Today)
BEIRUT — Banque du Liban (BDL) announced Friday that it had extended Circular No. 161 for another month, until the end of April.
Circular No. 161 allows depositors — individuals, civil servants and companies — to convert lira into dollars at BDL's Sayrafa platform rate, which is lower than the market rate. It is effectively a means to obtain dollars at a subsidized rate.
This is the fifteenth such extension in almost a year and a half.
The circular was established as one of the main mechanisms to accommodate — or reinforce, depending on one's point of view — the illegal banking restrictions enforced by Lebanese banks since 2019.
BDL has never clearly communicated the source of the dollars it uses. The conversion ceilings depend on the quotas given by BDL.
The central bank has opened the floodgates several times in recent months in an attempt to control the parallel market exchange rate, which has risen sharply since the beginning of the year.
The rate is currently hovering around LL108,000 to the dollar. The Sayrafa rate is currently fixed at LL90,000 and applies to individuals and companies that convert lira under Circular No. 161.
Since the beginning of the year, civil servants have benefited from a preferential rate to withdraw their salaries in dollars. The rate has been set at LL60,000 for March salaries.