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#51 March 18 2020

NuclearVision
Member

Re: Lebanese Banks Capital Control

Banks are closed until the next month.

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#52 March 18 2020

wollyka
Member

Re: Lebanese Banks Capital Control

NuclearVision wrote:

Banks are closed until the next month.

Not all. Check their facebook pages
Audi, BLOM, CL, BoB among others are opening a few branches but mainly to serve companies and corporate clients. Fransabank is closed etc..

Last edited by wollyka (March 18 2020)

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#53 March 18 2020

kareem_nasser
Member

Re: Lebanese Banks Capital Control

samer wrote:

Any updates on the latest limits? I'm hearing banks are constantly changing them.

Would be great if you would be more specific about the bank and account currency, since some are changing the limits on a weekly basis.

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#54 March 20 2020

Johnaudi
Member

Re: Lebanese Banks Capital Control

Lots of spreading rumors of the haircut being near. Seeing what is happening with the world right now, I highly doubt anyone can aid us; any idea whether the circulating rumor may be accurate?

Note: Although I know some people donating to the Red Cross may be out of generosity and have genuine thoughts, others specified in the donations list tried to trim down their bank account dollars so they reach a lower haircut in case it happens. It's for a good cause I guess?

Last edited by Johnaudi (March 20 2020)

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#55 March 20 2020

Dan28
Member

Re: Lebanese Banks Capital Control

Johnaudi wrote:

Lots of spreading rumors of the haircut being near.

what does happen in a haircut?

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#56 March 20 2020

kareem_nasser
Member

Re: Lebanese Banks Capital Control

Haircut was already taking place since October, with the dual exchange rates and capital controls.

Our economy is around 70% in dollars and this is tragic given that it isn't productive. There are a ton of reason this being the case and of course corruption is one of them.

What is being rumored now is basically Haircut/freeze on dollar account holders and you will be provided with shares held for 6 years (maturity). Not sure about the reset of the details yet but seems the image is becoming clearer (more kicking the can).

Last edited by kareem_nasser (March 20 2020)

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#57 March 20 2020

Tech Guru
Member

Re: Lebanese Banks Capital Control

kareem_nasser wrote:

Haircut was already taking place since October, with the dual exchange rates and capital controls.

Our economy is around 70% in dollars and this is tragic given that it isn't productive. There are a ton of reason this being the case and of course corruption is one of them.

What is being rumored now is basically Haircut/freeze on dollar account holders and you will be provided with shares held for 6 years (maturity). Not sure about the reset of the details yet but seems the image is becoming clearer (more kicking the can).


Yep , the Minister of Finance will propose two additioanl things which will be most probably be implemented and the cabinet will approve for execution.

1- To legalize and standarize all capital control being taken since September 2019 and increased.

2- To give the BDL Governer special authorities over the banks he doesnot used to have.

3-  To freeze all dollars deposits and giving the depositors an LBP rate of 2000 instead of 1515 ,  in case they want to withdraw.  To clear yet if LBP account depositors can withdraw USD from inside the bank at a rate of 2000 LBP too.

To sum it up ,  it is "theft in a legalized way". The whole system is collapsed. Commercial banks used to give high interests on USD and LBP as a motivator for people to put their money. Many people through the years deposited a lot of money. Fiscal deficit always exists,  due to corruption and a system controlled by warlords mainly. The government has been always requesting money as debt from commercial banks. The commercial banks bough EuroBonds for the sake of the government ..  Now BDL liquidity is low no money to payback for EuroBonds .. Commercial banks are in trouble.. A loop with one corrupted system that collapsed on each other.1

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#58 March 25 2020

kareem_nasser
Member

Re: Lebanese Banks Capital Control

Since Capital Controls will be official soon and they are being discussed in cabinet meetings, we need to keep an eye and share the final decision once approved here.

Let us avoid rumors circulating.

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#59 March 25 2020

NuclearVision
Member

Re: Lebanese Banks Capital Control

I dont think it will be official, the speaker of the cabinet said, when asked, they're leaning towards dismissing it.

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#60 April 3 2020

Tech Guru
Member

Re: Lebanese Banks Capital Control

Two circulations were issued today by BDL:

In Short

Circulation 1 :

If  a depositor has<= 5 million LBP the bank will buy it @ 1500 rate- official rate (   assume 5 million LBP / 1500 = 3333USD & sell back to you depending on the market rate on the day of withdraw

If a depositor has <= 3k USD they will give LBP depending on the market rate on the day if withdraw.

Circulation 2:

Establishing a unified electronic hub (between exchangers , Banks , snd BDL) for day to day market exchange rare of all foreign currencies including USD.




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Ext-Image-3443342-926567424.jpg

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#61 April 3 2020

NuclearVision
Member

Re: Lebanese Banks Capital Control

i dont know of this is good or bad...

Last edited by NuclearVision (April 3 2020)

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#62 April 3 2020

TrollFatGuy
Member

Re: Lebanese Banks Capital Control

Are we shifting towards removing the peg on the LL completely? Because those like the first step towards that.
Any input on the above is appreciated because I do not think I fully understand the consequences of these steps.

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#63 April 3 2020

xazbrat
Member

Re: Lebanese Banks Capital Control

It looks like they are trying to ease the demand for actual dollar notes by giving LL's at the market rate.   In theory, it should, at least initially, ease the demand for notes, but yeah, it looks like the peg is gone for now.  They may try to control where the dollar is by including the exchanges too---the government could conceivably demand the exchanges adjust their rates too, but we will have to see how the system is set up and controlled.

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#64 April 3 2020

Draguen
Member

Re: Lebanese Banks Capital Control

It seems like the first step to remove the peg, but major elements such as the gasoline price / medical imports etc, that the BDL sponsor access to dollars are still at 1500.

Last edited by Draguen (April 3 2020)

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#65 April 3 2020

Johnaudi
Member

Re: Lebanese Banks Capital Control

Draguen wrote:

It seems like the first step to remove the peg, but major elements such as the gasoline price / medical imports etc, that the BDL sponsor access to dollars are still at 1500.

Not necessarily remove (although it should be done that way), but regulate the US dollar price.
By giving people access to a certain amount of USD, most of them of this class will need to sell the USD at black market price to get LBP (hence to be able to purchase food etc.) making the black market price even lower and profiting the poorer class.
I think it's a good step IMO.

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#66 April 3 2020

dsoftware.king
Member

Re: Lebanese Banks Capital Control

They are trying to set aside a big portion of depositors (60%) that are very sensitive to the capital control. The real battle is yet to come, I think this is an indication that there is something bad coming.

(No USD withdrawal in the future).

Besides, how many exchange rates will we have?!!!

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#67 April 3 2020

Adnan
Member

Re: Lebanese Banks Capital Control

I don't understand the 5million LBP part. If my money is 5million LBP why do they want to give me profit out of it? Am I missing something?

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#68 April 3 2020

nuclearcat
Member

Re: Lebanese Banks Capital Control

Adnan wrote:

I don't understand the 5million LBP part. If my money is 5million LBP why do they want to give me profit out of it? Am I missing something?

1)To be able to pay salaries in bank accounts
2)60% of depositors, majority
2.1)Who crowd banks daily to get their tiny cut of cash
2.2)Who is most capable to go to streets

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#69 April 3 2020

NuclearVision
Member

Re: Lebanese Banks Capital Control

nuclearcat wrote:
Adnan wrote:

I don't understand the 5million LBP part. If my money is 5million LBP why do they want to give me profit out of it? Am I missing something?

1)To be able to pay salaries in bank accounts
2)60% of depositors, majority
2.1)Who crowd banks daily to get their tiny cut of cash
2.2)Who is most capable to go to streets

They get rid of you by closing your bank account for good, thats the condition, or so I've heard.
edit: if you mean why not only usd holders: to not to have bad reputation, to make people believe that their lbp will always be safe, to be honest, it's not gonna cost them a lot anyway.
Imagine they didn't do this, 1 year from now, I win 10millions, i want to put them in the bank, i remember that oh! one year ago they screwed lbp holders and i won't put it in the bank: it's history that matters

Last edited by NuclearVision (April 3 2020)

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#70 April 3 2020

VincentKeyboard
Member

Re: Lebanese Banks Capital Control

How will this affect prices of goods?

Last edited by VincentKeyboard (April 3 2020)

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#71 April 3 2020

nuclearcat
Member

Re: Lebanese Banks Capital Control

VincentKeyboard wrote:

How will this affect prices of goods?

IMO badly.
Lot of LBP flow to market, no USD flows from banks (people was getting their $100-$200 and selling to sarraf, this was making supply of USD cash). This means significant LBP devaluation.

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#72 April 3 2020

VincentKeyboard
Member

Re: Lebanese Banks Capital Control

This is suicide then. Why is BDL doing this?

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#73 April 3 2020

nuclearcat
Member

Re: Lebanese Banks Capital Control

People in chats discussed that and opinions are:
1)It will  calm down for a while low income class. Lebanon might get IMF loan later on or so, maybe govt will figure out something.
2)Because things are getting really bad https://www.courrierinternational.com/a … e-covid-19

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#74 April 4 2020

xazbrat
Member

Re: Lebanese Banks Capital Control

nuclearcat wrote:
VincentKeyboard wrote:

How will this affect prices of goods?

IMO badly.
Lot of LBP flow to market, no USD flows from banks (people was getting their $100-$200 and selling to sarraf, this was making supply of USD cash). This means significant LBP devaluation.

The price of most goods is already reflected in the black market price, but things denominated in foreign currency like fuel, medicines and other items will be hit pretty hard, at least initially.   They may be trying to soften the blow a bit with this current move and I think they are preparing for an IMF loan.  One of the conditions would be to remove the peg, and this is a way to do it, without saying they are doing it.

Also, I am led to believe that the money flowing from banks to customers to sarafeen was leaving the country and heading to Syria and elsewhere.  Apparently, the premium on the dollar there is greater than it is here so this is one of the reasons why the sarafeen aren't selling too many dollars, but buying as much as they can.

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#75 April 4 2020

Kareem
Member

Re: Lebanese Banks Capital Control

dsoftware.king wrote:

They are trying to set aside a big portion of depositors (60%) that are very sensitive to the capital control. The real battle is yet to come, I think this is an indication that there is something bad coming.

(No USD withdrawal in the future).

Besides, how many exchange rates will we have?!!!

This. Exactly what's going to happen.

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