The IMF headquarters in Washington. (Credit: AFP)
Since 2019, the fate of Lebanon’s banking sector has been one of the main sticking points in reaching an agreement with the IMF. Despite optimistic statements from both sides, an IMF visit this week, led by Mission Chief Ernesto Ramirez Rigo, is expected to spark another standoff over a controversial proposal: temporarily replacing most banks’ management with independent administrators.The IMF’s proposal came as the discussions remain deadlocked over Article 4 of the draft law on financial stabilization and deposit recovery (financial gap law) after nearly 35 hours of discussions. The article deals, among other things, with the assessment of Banque du Liban (BDL) and commercial banks. At the heart of the disagreement is how losses will be absorbed. The IMF wants each bank’s financial position independently assessed before its...
Since 2019, the fate of Lebanon’s banking sector has been one of the main sticking points in reaching an agreement with the IMF. Despite optimistic statements from both sides, an IMF visit this week, led by Mission Chief Ernesto Ramirez Rigo, is expected to spark another standoff over a controversial proposal: temporarily replacing most banks’ management with independent administrators.The IMF’s proposal came as the discussions remain deadlocked over Article 4 of the draft law on financial stabilization and deposit recovery (financial gap law) after nearly 35 hours of discussions. The article deals, among other things, with the assessment of Banque du Liban (BDL) and commercial banks. At the heart of the disagreement is how losses will be absorbed. The IMF wants each bank’s financial position independently assessed before its...
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