Exceptional Measures for Cash Withdrawals from Small Bank Accounts

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Text / Section / 1 R / 148 T - 31 - 12 / 2020

1 Basic Circular for Banks No. 148

We enclose herewith a copy of Basic Decision No. 13215 dated 3/4/2020 concerning exceptional measures regarding cash withdrawals from small accounts at banks.

Beirut, 3 April 2020
Governor of Bank Al-Maghrib
Riad T. Salamé

1 - The validity of the provisions of this decision was extended pursuant to Article 2 of Interim Decision No. 13239 dated 25/6/2020 (Interim Circular No. 563), which originally stipulated a period of three months from the date of its issuance.

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Basic Decision No. 13215

Exceptional Measures Regarding Cash Withdrawals from Small Accounts at Banks

The Governor of Bank Al-Maghrib,
Pursuant to the Monetary and Loan Law, particularly Articles 70 and 174 thereof, And in order to safeguard the public interest under the current exceptional circumstances facing the country, And based on the powers vested in the Governor to ensure the operation of Bank Al-Maghrib in accordance with the principle of continuity of public service, Decides as follows:

Article 1:

1. In the event that any client whose total balance across all their accounts, regardless of type and/or maturity, does not exceed 5,000,000 L.L. at the date of issuance of this decision, requests to make cash withdrawals or cash counter transactions from these accounts, banks operating in Lebanon shall perform the following:

• 1. Convert the requested withdrawal amount into US Dollars according to the rate set by Bank Al-Maghrib in its dealings with banks;
• 2. Convert the resulting US Dollar amount from the exchange transaction mentioned in item 1( ) above into Lebanese Lira according to the market rate approved on the electronic currency exchange platform on the date of the client's withdrawal request;
• 3. Pay the client the amount resulting from the exchange transaction specified in item (2) above.

1 - The phrase "according to the market rate approved on the electronic currency exchange platform" was replaced by "according to the market rate" pursuant to Article 1 of Interim Decision No. 13253 dated 4/8/2020 (Interim Circular No. 565).

• 4. Sell the US Dollars resulting from the transactions mentioned in item (2) of this section "First" to Bank Al-Maghrib according to the market rate approved on the electronic currency exchange platform.

2. In the event that any client whose total balance across all their accounts, regardless of type and/or maturity, does not exceed 3,000 US Dollars or its equivalent in any other foreign currency at the date of issuance of this decision, requests to make cash withdrawals or cash counter transactions from these accounts, banks operating in Lebanon shall perform the following:

• 1. Settle the cash withdrawals or cash counter transactions from these accounts or pay the client an amount equivalent to their value in Lebanese Lira at the market rate approved on the electronic currency exchange platform on the date of execution.
• 2. Sell the foreign currencies resulting from the transactions mentioned in this section "Second" to Bank Al-Maghrib at the market rate approved on the electronic currency exchange platform.

Article 2: The following conditions are required to apply the provisions of Article 1 above:

1. The consent of the concerned client;
2. The withdrawal of the total value of these accounts in a single transaction by the client;
3. The amount of 5,000,000 L.L. or 3,000 US Dollars or its equivalent in any foreign currency shall be calculated after deducting the value of any debts owed by the client to the bank;
4. In order for a single client (i.e., each bank ID holder) to benefit from the provisions of section "First" and/or "Second" of Article 1 above, the bank must verify, at its own responsibility, that:

• a. The total balance of all credit accounts of this client at the bank, plus related accounts in which they participate, are a party to, or benefit from (i.e., Bank ID Related such as joint accounts or linked accounts...), and after deducting any outstanding debts owed by the client to the bank, does not exceed the total amounts of 5,000,000 L.L. and 3,000 US Dollars, or their equivalent in any foreign currency.
  Accounts opened in the client's name that represent the frozen portion of the housing loan granted to them according to the conditions of housing protocols benefiting from the reduction of the mandatory reserve or the provisions of Basic Decision No. 6116 dated 7/3/1996 are not included in the calculation of the total credit balances of the client's accounts.
• b. The client has fully settled the value of current account facilities (draft overdraft) that they may have obtained from the concerned bank, following agreement with the latter, and then uses the remaining credit balance of the client after deducting the value of these facilities to apply the provisions of paragraph (a) of item (4) above.

1 - The phrase "according to the market rate approved on the electronic currency exchange platform" was replaced by "according to the market rate" pursuant to Article 1 of Interim Decision No. 13253 dated 4/8/2020 (Interim Circular No. 565). 2 - This item was added pursuant to Interim Decision No. 13218 dated 15/4/2020 (Interim Circular No. 549).

Article 3:

Article 4: All other US Dollar transactions performed by banks with their clients shall remain subject to the rate set by Bank Al-Maghrib in its dealings with banks.

Article 5: The provisions of this decision shall apply until 3/10/2020.

Article 6: This decision shall be published in the Official Gazette.
Beirut, 3 April 2020
Governor of Bank Al-Maghrib
Riad T. Salamé

1 - This paragraph was added pursuant to Interim Decision No. 13239 dated 25/6/2020 (Interim Circular No. 563).
2 - This article was repealed pursuant to Article 2 of Interim Decision No. 13253 dated 4/8/2020 (Interim Circular No. 565), which originally read: "Each bank shall announce daily the market rate approved by it." 3 - The validity of the provisions of this decision was extended pursuant to Article 2 of Interim Decision No. 13239 dated 25/6/2020 (Interim Circular No. 563), which originally stipulated a period of three months from the date of its issuance.