The consolidated financial statements of the Lebanese banking system showed an additional decrease in total assets during the first quarter of this year by 3.8%. This brought the cumulative contraction to 17.5 percent year-on-year, or $44.25 billion, so that the combined assets declined to $208.5 billion, compared to $252.75 billion at the end of the first quarter of last year.
The reasons for the decline in the size of the assets of the banking sector in Lebanon are due to the high waves of withdrawals of deposits at a high rate since the outbreak of the popular protests on October 17 of last year, the decline in foreign transfers to their lowest levels, and the significant decline in the loan portfolio to the private sector. In addition to the government taking a decision to suspend the payment of the assets of the international debt bonds (Eurobonds) and their returns, whereby banks have a budget share of nearly half the value of the portfolio, which amounts to about $31 billion.
The reasons for the decline are partly due, especially in recent months, to the banks' undertaking Netting clearance of their loans in Lebanese pounds granted by the Central Bank of Lebanon, in return for their investments in Lebanese pounds with it, which bear the same deadlines resulting from financial engineering operations, within the framework of applying international standards.
Source (Al-Sharq Al-Awsat newspaper, Edited)
