Regulatory Alerts2021-11-03 | 13372Regulatory Rules of Circular 7926 Concerning Banks' Foreign Currency Investments, Monetary Reserve Requirements, Minimum Special Reserves, and Required Investments of Islamic Banks
The Central Bank of Lebanon, via Circular No. 599 and Central Decision No. 13,372 dated November 3, 2021, amends Central Decisions No. 7,935 and No. 9,763 to set a 14% mandatory foreign currency investment ratio for banks, update reserve requirements and minimum special reserves for Islamic banks, and replace their reporting annexes (-10RO and -20RO). The revised framework takes effect from December 2 to December 8, 2021, and standardizes deductions for new accounts, accrued interest, and credit-linked balances across resident and non-resident operations. These adjustments operationalize exceptional monetary measures designed to activate domestic banking activities and support the gradual repayment of foreign currency deposits.
Circular No. 599 To Banks: We enclose a copy of Central Decision No. 13,372 dated November 3, 2021, concerning the amendment of:
- Central Decision No. 7,935 dated September 27, 2001 (Implementing Rules for Central Decision No. 7,926 dated September 20, 2001 (Banks' Mandatory Investments)), attached to Circular No. 87.
- Central Decision No. 9,763 dated November 9, 2007 (Mandatory Monetary Reserve and Minimum Special Reserve for Islamic Banks and their Mandatory Investments), attached to Circular No. 113.
Beirut, November 3, 2021 Governor of the Central Bank of Lebanon Riad T. Salam
Central Decision No. 13,372 Amendment of Central Decision No. 7,935 dated September 27, 2001 and Central Decision No. 9,763 dated November 9, 2007
The Governor of the Central Bank of Lebanon, Pursuant to Articles 17 and 70 of the Monetary and Banking Law, Pursuant to Central Decision No. 7,935 dated September 27, 2001 and its amendments concerning the implementing rules for Central Decision No. 7,926 dated September 20, 2001 (Banks' Mandatory Investments), Pursuant to Central Decision No. 9,763 dated November 9, 2007 and its amendments concerning the mandatory monetary reserve, minimum special reserve for Islamic banks, and their mandatory investments, Pursuant to Central Decision No. 13,262 dated August 27, 2020 concerning exceptional procedures to activate the operations of banks operating in Lebanon, Pursuant to Central Decision No. 13,335 dated June 8, 2021 and its amendment concerning exceptional procedures for the gradual repayment of foreign currency deposits, Pursuant to a resolution adopted by the Central Council of the Central Bank of Lebanon at its meeting held on October 27, 2021,
Has Decided the Following:
Article One: The text of Annex (-10RO) attached to Central Decision No. 7,935 dated September 27, 2001 is repealed and replaced by the new text attached to this Decision.
Article Two: The text of Annex (-20RO) attached to Central Decision No. 9,763 dated November 9, 2007 is repealed and replaced by the new text attached to this Decision.
Article Three: This Decision takes effect for the period from Thursday, December 2, 2021, through Wednesday, December 8, 2021.
Article Four: This Decision shall be published in the Official Gazette. Beirut, November 3, 2021 Governor of the Central Bank of Lebanon Riad T. Salam
Central Bank of Lebanon Statistics and Economic Research Department
1 Foreign currency liabilities subject to the 14% rate imposed by Central Decision No. 7,926 Attached to Circular No. 86 and Central Decision No. 7,935 attached to Circular No. 87 Form -10RO Average between _______________ and ___________________ Bank Number: Bank Name: Valued in US Dollars
| Account Code | Description |
|---|---|
| 20100 | Other non-resident issuing institutions |
| 20180 | Less: Accrued but unpaid interest (non-resident) |
| 20200 | Non-resident commercial banks |
| x20200 | Less: New accounts subject to Circular No. 150 |
| 20250 | Less: Current accounts against loans (non-resident) |
| 20280 | Less: Accrued but unpaid interest (non-resident) |
| 20300 | Non-resident medium and long-term credit institutions |
| x20300 | Less: New accounts subject to Circular No. 150 |
| 20370 | Less: Current accounts against loans (non-resident) |
| 20380 | Less: Accrued but unpaid interest (non-resident) |
| 20500 | Resident and non-resident financial institutions |
| x20500 | Less: New accounts subject to Circular No. 150 |
| 20560 | Less: Current accounts against loans |
| 20580 | Less: Accrued but unpaid interest |
| 23900 | Other resident and non-resident financial sector institutions |
| x23900 | Less: New accounts subject to Circular No. 150 |
| 23960 | Less: Current accounts against loans |
| 23980 | Less: Accrued but unpaid interest |
| 20800 | Customer deposits (resident and non-resident) |
| x20800 | Less: New accounts subject to Circular No. 150 |
| s20800 | Less: Special accounts subject to Circular No. 154 |
| y20800 | Less: Exchange accounts subject to Circular No. 157 |
| g20800 | Less: Branch special accounts subject to Circular No. 158 |
| 20871 | Less: Insurance for documentary credits for imports |
| 20890 | Less: Current accounts against loans |
| 20895 | Less: Accrued but unpaid interest |
| 24300 | Deposits originated by credit contracts (resident and non-resident) |
| x24300 | Less: New accounts subject to Circular No. 150 |
| 24301 | Less: Accrued but unpaid interest included therein |
| 20900 | Public sector deposits |
| x20900 | Less: New accounts subject to Circular No. 150 |
| 20980 | Less: Accrued but unpaid interest |
| 21000 | Payment values for residents and non-residents |
| x21000 | Less: New accounts subject to Circular No. 150 |
| 21210 | Other debtors - resident and non-resident private sector |
| x21210 | Less: New accounts subject to Circular No. 150 |
| 21221 | Other debtors - public sector current accounts |
| x21221 | Less: New accounts subject to Circular No. 150 |
| 21300 | Partners - resident and non-resident |
| x21300 | Less: New accounts subject to Circular No. 150 |
| s21300 | Less: Special accounts subject to Circular No. 154 |
| y21300 | Less: Exchange accounts subject to Circular No. 157 |
| g21300 | Less: Branch special accounts subject to Circular No. 158 |
| 21325 | Less: Accrued but unpaid interest |
| 21330 | Less: Cash advances designated to cover reserve fund shortages |
| 21350 | Less: Deposits designated to increase own funds |
| z21700 | Bonds and similar instruments (maturity one year or less) |
| 21748 | Less: Accrued but unpaid interest at fair value against profit and loss account |
| 21755 | Less: Accrued but unpaid interest classified at amortized cost |
| 23000 | Foreign branches |
| x23000 | Less: New accounts subject to Circular No. 150 |
| 23050 | Less: Current accounts against loans |
| 23080 | Less: Accrued but unpaid interest |
| z23100 | Head office, parent institution, banks and financial institutions (sister and subsidiary companies, excluding resident banks) |
| x23100 | Less: New accounts subject to Circular No. 150 |
| 23150 | Less: Current accounts against loans |
| 23180 | Less: Accrued but unpaid interest |
| z24600 | Certificates of deposit at fair value against profit and loss account (maturity one year or less / excluding those sold to resident banks) |
| 24680 | Less: Accrued but unpaid interest |
| z24700 | Certificates of deposit at amortized cost (maturity one year or less / excluding those sold to resident banks) |
| 24780 | Less: Accrued but unpaid interest |
| 99999 | Total resident liabilities in US Dollars |
Note: Review of Article 1 of Basic Decision No. 7,926: Bonds, deposit certificates, and bank certificates issued by banks, and loans obtained from the financial sector, with only one year or less remaining until maturity for each. Name: ------------------------------ Signature: -----------------------------
Foreign currency liabilities for Islamic banks subject to Decision 9,763 Form -20RO Average of the week ending //____ Bank Name: Islamic _________ Valued in US Dollars
| Account Code (Islamic Banks Status - Form 3010) | Description |
|---|---|
| 201000 | Issuing institutions - non-resident |
| 202000 | Banks and financial institutions (resident and non-resident) (1) |
| x20200 | Less: New accounts subject to Circular No. 150 |
| 203000 | Foreign branches |
| x20300 | Less: New accounts subject to Circular No. 150 |
| 204000 | Parent institution, sister and subsidiary companies (resident and non-resident, excluding resident banks) |
| x20400 | Less: New accounts subject to Circular No. 150 |
| 205000 | Public sector accounts |
| x20500 | Less: New accounts subject to Circular No. 150 |
| 206000 | Investment accounts - customers (resident and non-resident) |
| x20600 | Less: New accounts subject to Circular No. 150 |
| s20600 | Less: Special accounts subject to Circular No. 154 |
| y20600 | Less: Exchange accounts subject to Circular No. 157 |
| g20600 | Less: Branch special accounts subject to Circular No. 158 |
| 207000 | Partner current accounts - resident and non-resident |
| x20700 | Less: New accounts subject to Circular No. 150 |
| s20700 | Less: Special accounts subject to Circular No. 154 |
| y20700 | Less: Exchange accounts subject to Circular No. 157 |
| g20700 | Less: Branch special accounts subject to Circular No. 158 |
| 207900 | Less: Accounts to cover bad debt losses |
| 209000 | Issued Sukuk - resident and non-resident |
| 209800 | Less: Accrued but unpaid liabilities |
| 211000 | Creditor debts - resident and non-resident |
| 212110 | Other debtors, private sector - resident and non-resident |
| x21211 | Less: New accounts subject to Circular No. 150 |
| 212300 | Payment values – resident and non-resident |
| x21230 | Less: New accounts subject to Circular No. 150 |
| 299999 | Total resident liabilities in US Dollars |
Investment accounts subject to minimum reserve at Islamic banks Investment account liabilities 322000 999999 Total resident liabilities and investment accounts in US Dollars
Fax Number: ______________________________________ Responsible Person Name: __________________________ Signature: ___________________
(1) This amount represents a portion of the figure in item 202,000 (Banks and financial institutions) in Form 3010.