Operations relating to credit, investment and shareholding and participation

Circular No. 664

To Banks and Financial Institutions

Circular Decision No. 13542 dated 28/3/2023 relating to amending a copy of the Central Decision No. 7776 dated 21/2/2001 (Credit, Investment, Shareholding and Participation Operations) Attached to Circular No. 81

Beirut, on March 28, 2023

Governor of the Central Bank of Lebanon

Riad T. Salamé

Circular Decision No. 13542

Amending Central Decision No. 7776 dated 21/2/2001 (Credit, Investment, Shareholding and Participation Operations)

The Governor of the Central Bank of Lebanon, pursuant to the Monetary and Loan Law, particularly Articles 70, 79, and 174 thereof, pursuant to the Civil Procedure Law, particularly Article 863 thereof, and based on Central Decision No. 7776 dated 21/2/2001 and its amendments regarding credit, investment, shareholding, and participation operations, and since it has become evident that some banks are garnishing their clients' salaries held with them in order to collect installments or due payments in foreign currencies resulting from loans granted to them, at a rate of 15,000 Lebanese Lira per one US Dollar, and given that the salaries of low-income earners are insufficient to cover installments for US Dollar loans granted to most beneficiaries amid the rise in the US Dollar exchange rate, and considering the difficult living conditions suffered by Lebanese people due to the exceptional circumstances Lebanon is going through, in general, and low-income earners in particular, based on the decision of the Central Bank Board taken in its meeting held on March 22, 2023,

has decided as follows:

Article One: The following text is added to "Repeated Article Three" of Central Decision No. 7776 dated 21/2/2001
under the "seventh" paragraph:

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Seventh: Banks operating in Lebanon are required to:

• Comply with the provisions of Article 863 of the Civil Procedure Law and not garnish
  salaries or deduct from them more than the percentages specified in said article.
• Work on restructuring installment loans granted in US Dollars such that
  monthly repayments related to these loans do not exceed the percentages specified in Article 863 of the Civil Procedure Law and in paragraph (c) of item (1) of the "second" paragraph of this article.

Article Two: This decision shall be effective upon its issuance.

Article Three: This decision shall be published in the Official Gazette.

Beirut, on March 28, 2023

Governor of the Central Bank of Lebanon

Riad T. Salamé