Lebanon’s central bank has revealed that depositors will be allowed to withdraw limited monthly amounts from their foreign currency accounts, nearly 20 months after banks denied them access amid a severe financial crisis.
The move is a small step toward instituting formal capital controls after Lebanese banks arbitrarily imposed policies preventing depositors from accessing their dollar accounts even as the local currency collapsed and a black market thrived, said AP.
According to the new central bank circular, depositors will be allowed to withdraw up to $400 a month in cash and another $400 in local currency at a rate eight times higher than the official rate.
The Lebanese pound, pegged to the dollar at 1,515 for more than 20 years, has been crashing since 2019, losing more than 85 percent of its value to the dollar.
The crash prompted banks to impose informal capital controls, barring depositors from reaching into their dollar accounts, as well as stopping transfers. Depositors have been allowed to withdraw foreign currency transferred into the country, or “fresh dollars”, after the crisis began.
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