"The headquarters of the Bank of Lebanon, in Beirut. (Credit: João Sousa)
BEIRUT — Nearly two years after Riad Salameh's last term ended, Cabinet has finally agreed on his successor, choosing fund manager Karim Souhaid as the new governor of the Banque du Liban (BDL).
The candidate won the votes of 17 ministers out of the 24 members of Nawaf Salam's government, according to figures reported by LBCI.
Souhaid has the support of President Joseph Aoun, who sees him as best placed to take charge of an institution that has faced a chain of corruption scandals and has been largely discredited by revelations surrounding mismanagement, especially during the outbreak of the financial crisis.
According to sources close to Aoun, the president hopes Souhaid will support the government in its attempts to lift Lebanon out of its dire economic condition, push through the necessary legislation and restore depositors' rights.
Ahead of Thursday’s Cabinet meeting, during which choosing a head of BDL topped the agenda, Finance Minister Yassine Jaber told reporters he hoped the ministers would reach a consensus, avoiding the need for a vote. The meeting began at noon and the decision was announced shortly before 4 p.m.
Prime Minister Nawaf Salam, on the other hand, was completely opposed to Souhaid as a candidate. Salam delivered a brief statement when the meeting was adjourned, in which he declared that going forward, what is important is that the new governor adhere to the reform policies laid out by Salam's government.
Jaber presented three candidates for consideration, two of whom he named ahead of time: Souhaid, who it was known had a qualified majority, and Edouard Gemayel, an International Monetary Fund (IMF) executive. Jaber’s initial choice for a third candidate, banker and asset manager Jamil Baz, withdrew yesterday, citing "the uproar that followed his preselection," and his replacement was not disclosed.
Aoun and Salam met before the Baabda Cabinet meeting, as did Kataeb leader Samy Gemayel, who, according to sources from the presidential palace, asked the president to remove the BDL governor’s appointment from the agenda.
The new BDL head is set to succeed the first vice-governor Wassim Manssouri, who has been acting-governor since Riad Salameh's term ended on July 31, 2024. Salamh was jailed last September after being charged with alleged financial misconduct in several cases throughout his term, but he denies any responsibility.
This appointment is also crucial to starting a new cycle of discussions between Lebanon and the IMF to allow the country to subscribe to an assistance program conditioned on the implementation of reforms that have been due for years. This agreement would also facilitate the task of gathering at least $11 billion needed to rebuild areas destroyed by Israel during its war with Hezbollah.
Among other topics expected at the meeting is a bill presented by Jaber to amend the law that governs banking secrecy and has been accompanied by provisions amending its retroactivity.
