The façade of the Central Bank. (Credit: L'Orient-Le Jour Archive Photo)
Five years after the outbreak of the economic crisis, the thorny issue of the financial system’s losses — and how they should be distributed — may be getting a partial answer through what looks like a sleight of hand.According to sources directly involved in the talks, ongoing discussions between the Central Bank (BDL) and the government — represented by the Finance and Economy ministries — over a draft law on financial restructuring and the restitution of deposits – long dubbed the “financial hole law” – could lead to measures aimed at erasing $30 billion from the balance of deposits still being – illegally – stuck in banks since October 2019.A new implicit haircutIf this measure is included in the draft law, the total residual amount of deposits would shrink from around $82 billion to between $50 and $52 billion, to be settled over...
Five years after the outbreak of the economic crisis, the thorny issue of the financial system’s losses — and how they should be distributed — may be getting a partial answer through what looks like a sleight of hand.According to sources directly involved in the talks, ongoing discussions between the Central Bank (BDL) and the government — represented by the Finance and Economy ministries — over a draft law on financial restructuring and the restitution of deposits – long dubbed the “financial hole law” – could lead to measures aimed at erasing $30 billion from the balance of deposits still being – illegally – stuck in banks since October 2019.A new implicit haircutIf this measure is included in the draft law, the total residual amount of deposits would shrink from around $82 billion to between $50 and $52 billion,...
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