Regulatory Alerts2023-02-15
Notice No. 90 on Amending the Business Conduct Regulation Series 3000 Regarding Unspecified Perpetual Preferred Shares
Issued by the Capital Markets Authority and the Central Bank of Lebanon, this notice mandates Lebanese licensed institutions to immediately halt pricing unspecified Perpetual preferred shares in customer statements and replace their market value with "Not Available" until further notice. The directive, grounded in the current exceptional economic circumstances and Law No. 161, also requires institutions to cease collecting deposit fees for these shares while preserving the banking system's integrity. It takes effect upon publication in the Official Gazette and operates under Clause 4 of Article 3311 of the Business Conduct Regulation Series 3000.
Notice No. 90 Addressed to Licensed Institutions
Regarding Unspecified Perpetual Preferred Shares
Based on Law No. 161 dated August 17, 2011 regarding Financial Markets, and based on the Business Conduct Regulation Series 3000 issued by the Capital Markets Authority on November 10, 2016, and based on Capital Markets Authority Board Decision No. 23/1/5 taken in its meeting held on January 24, 2023, to preserve the integrity of the banking system and public interest in the current exceptional circumstances facing the country, we inform you as follows:
Subject to the provisions of Clause 4 of Article 3311 of the Business Conduct Regulation Series 3000, specifically for Lebanese banks, and regarding unspecified Perpetual preferred shares issued by Lebanese banks due to the lack of a sound and fair market value (Fair Market Value) for these shares in current circumstances; licensed institutions must immediately stop pricing the shares in customer account statements and replace the previously approved market value with the phrase "Not Available", and also stop collecting deposit fees related to those shares from customers, until further notice.
Second: This notice takes effect immediately upon its publication in the Official Gazette. Beirut, February 15, 2023
Chairman of the Capital Markets Authority / Governor of the Central Bank of Lebanon Riad T. Salamé