The governor of the Bank of Lebanon Wassim Mansouri in an interview with “Al -Arabi Al -Jadeed”: 4 columns to restore confidence to the banking sector

The Acting Governor of Lebanon, Wassim Mansouri, expressed his optimism about the future of the banking sector and the construction of the Lebanese state, stressing in an interview with “Al -Arabi Al -Jadeed” that re -confidence is through four columns, which are accountability by eliminating the judicial assets, returning the money of depositors, building the banking sector again, and reforming the state.

Mansouri emphasized that the issue of deposits is linked to four parties, the depositor, the Bank of Lebanon, the banks and the state. The depositor does not bear any responsibility, and everyone must work to restore his deposit in a fair plan, and help to return the money as soon as possible, as after 6 years of delay, the depositor must take a healing answer from the Bank of Lebanon, the government and parliament, especially at the level of the mechanism that will restore his deposit and the time period to achieve this.

Mansouri also revealed that the atmosphere was positive at the level of the meeting that was held this week with the International Monetary Fund, which expressed its openness to help Lebanon, and the international community in turn is expected from Lebanon to carry out reforms in order to start the course of aid, indicating that the most prominent reforms required by the fund are related to laws that must be approved, including those related to the money of the depositors, the restructuring of banks, the banking confidentiality, and the restructuring of the sector General.

The following is the text of the dialogue:

– A few weeks away from the appointment of a new ruler of the Bank of Lebanon, how can you evaluate the period of your rule of governance, and were you able to achieve what you were unable to do on the day you were a deputy ruler (former), Riyad Salama?

The main problem was the way to deal with the great financial collapse by adopting the wrong mechanisms that were manifested in support, as the Central Council at the Bank of Lebanon at that time, when I was a deputy governor at the time, Riyad Salama, with other colleagues, we were against the support policy, and we succeeded in stopping it, but after a period I witnessed a very large spending from the reserves of the central bank, and we were also refusing to spend it, this is the basic point that pushed to be to be The Central Council has a different direction from the policy of the former ruler and the previous government at that time.
And when I received, I stopped, not only support, but also the financing of the state, and thus stopped any relationship between the Lebanese state and the central bank, and this is normal when the state is abstaining from payment, as it is assumed in this case that the state is satisfied with its resources to cover all its expenses, it cannot go towards the global markets for borrowing, while its resort to the Bank of Lebanon for borrowing means taking the last of the wealth of the Lebanese to use it The sinner, which must be returned to them through the banking sector.

All of these reasons led to the decision -making to stop the state’s finance permanently on August 1, 2023, and then we announced that we are facing a crossroads, and we will take a different path from that on which it was on the basis of forty years.

Until today, and about two years after receiving the ruler of the Bank of Lebanon, no amount has been paid to the Lebanese state from the funds of the Central Bank of Lebanon, which in turn was paid from its money, which led to a balanced budget, so that the state is spent from what it obtained, and the budget has decreased significantly from 17 billion dollars to 3.2 billion in 2024, and today it is approximately 5 billion, and as long as the state is able to obtain and dispose of the money, the state is able Therefore, we are on a sound path to build a good economy.

Likewise, the past period witnessed several events, most notably the Israeli war, and therefore we had several aspirations to achieve it, including ending the banking crisis, the deposit crisis and returning money to depositors, completing the agreement with the International Monetary Fund, and moving to a mobile platform to determine the exchange rate .. These are all done less than what we wish in light of the circumstances that existed in the country.

Is it possible for the Bank of Lebanon to return to the state’s support, especially in light of the new era?

The wrong policy cannot become a correct policy of changing circumstances, and therefore the policy of state support or payment by the Bank of Lebanon for the state is a wrong policy, and I think that if we did not follow this policy and stop supporting the state in a period when Lebanon was living with an economic love, we would have the possibility of development economically significantly. Therefore, there is no return to this policy.
On the other hand, we were able to achieve cash stability in the country despite the circumstances it passed and the wars, and this had a basis for the state to continue and pay its salaries and requirements and taxes on a unified price, in connection with close cooperation between the central bank and the government and the Ministry of Money, in a way in which no pounds are pumped into the market more than it bears, and the bank in turn was doing its duties in the matter of monetary stability, and I believe that it succeeded Today in preserving it.

How much deposits are today in the banking sector and how are it distributed?

The deposits amount to 86 billion dollars, and it is distributed to the banking sector according to the sizes of banks, classified as a category or less, and we have all the details of the deposits from zero to 3 thousand, and from 3 thousand to 5 thousand, up to tens of million dollars. The accurate distribution helps in developing a later plan, and the study developed by the Bank of Lebanon is so accurate to the extent that the current government can rely on to develop a plan to return depositors ’money in an acceptable way.

– What is the plan for the Bank of Lebanon to restore deposits? And for how long will the depositor remain a mortgage of circulars that bite the value of his money?

Unfortunately, the central bank is not a legislative authority, no executive authority, and does not make plans, but rather studies and clarify the numbers so that the government and the parliament later be able to adopt any plan, and unfortunately there have been circumstances and wars that prevented the previous government from moving more than the framework they have, but the circumstances today are new and momentum is with the new era, and I hope that they are based on the studies that we have prepared in the last period to develop a plan to restore deposits, then the central bank, then the central bank, then Establishing a plan that cannot be obligated.
On the other hand, the central bank pays the amounts according to the circulars in dollars, and therefore there is no delay from the money of the depositors.

Who should bear the losses in the budget of the Bank of Lebanon?

The issue of deposits is linked to four parties, the depositor, the Bank of Lebanon, the banks and the state. The depositor does not bear any responsibility, and everyone must work to restore his depositism within a plan that is fair, and helps to return the money as soon as possible, as after 6 years of delay, the depositor must take a healing answer from the Bank of Lebanon, the government and parliament, especially at the level of the mechanism in which his deposit and the time period to achieve this.

Consequently, the banks, the Bank of Lebanon and the state must all cooperate in order to pay the money of the depositors within a plan that preserves the banking sector, as without a banking sector, there is no economy, and therefore we have to hold banks responsible What it has, and the Lebanese state has unarmed fortunes, and this issue can be raised very thoughtful to know how the state contributes to returning these funds.

These matters are the issue of a daily debate within the Lebanese government and between the government and the central bank, and I believe that today there is a possibility to say that we are beginning to translate these discussions and may translate laws soon.

How is cooperation today with the New Testament, and can it establish positive results?

The relationship with President Joseph Aoun is very excellent, on the personal and professional levels, and when he was elected a president I visited and explained to him the situation in general, and I believe that he has all the desire to make quick reforms at the state level as a whole, which was mentioned in the department’s speech, and the whole state is a generation for translating the speech later with works.

Several work sessions were also held with Prime Minister Nawaf Salam, the ministers of money, Yassin Jaber, the economy Amer Basta and the concerned ministers, and the relationship is very excellent, and this is required, because the state can only build with close relations and direct and permanent economy, so I am optimistic that things will go in a good and good framework.

– On the impact of the tour of the International Monetary Fund delegation to Lebanese officials, how do you evaluate the talks, and what are the most prominent conditions that are demanded?

The meeting that we held last Wednesday with the delegation of the International Monetary Fund was positive, so that we assured them that Lebanon seeks a program with the Monetary Fund, and will negotiate it to set a program that preserves the money of depositors and state rights, and it is possible to reach good results from these negotiations. Also, the fund is open to help Lebanon, and the international community is waiting for Lebanon to carry out reforms to start the course of aid.
For its part, the current government, through its cabinet statement, was developed on the speech of President Joseph Aoun’s general points for reform, which are present, firm and firm, and it remains to be implemented, and we began to see some results, and they held one meeting and I think it will be followed by upcoming meetings, and the results will be good.

Among these results we will see the completion of some basic appointments soon, provided that other appointments are completed in subsequent sessions, including the appointment of a new ruler of the Bank of Lebanon, and I am mainly the duration of my ruler ending soon, and therefore it is necessary to be appointed, as soon as possible, a new ruler of the central bank, to conduct the delivery and delivery process comfortably, and receives all the files comfortably, and can complete the coming period accurately, and cooperates with the government as we cooperate in a way Positive, and I am sure this will happen.

As for the reforms requested by the International Monetary Fund, they are known, the most prominent of which are related to the approval of laws related to the money of depositors and the restructuring of banks, as well as the banking confidentiality law, and the restructuring of the public sector at various stages, as there is a great deficiency in the departments, and the current ministers have touched this when they include their ministerial portfolios, and I believe that they are afflicted to reform what can be properly repaired.

There are many laws whose decrees and the government are not issued immediately to issue them, and all these reforms at various levels will give an additional motivation to put the best negotiation of the Lebanese state with the fund, so that the more reforms, the better the position of Lebanon, and the ability to benefit from the box’s better program.

How can confidence be restored in the banking sector, and can this happen if those responsible for the cash and financial collapse are not held accountable?

There are four columns that can be built on the state, the first is accountability, and that is through the judiciary and within the judicial principles, and the judicial authority is required to fortify and this is essential. The second: Returning the money of depositors, because without this there can be no confidence in the sector. The third: It is the banking sector itself, because there is no economy without a banking sector, and we must thus build our banking sector again on the foundations that I mentioned, including the response of the money of depositors and accounting. Thus, there is a possibility to enlarge our economy quickly. For example, in 2010, and after the July 2006 war, growth in Lebanon reached about 10%, and major industrial countries did not reach this place, meaning Lebanon if it follows the sound railway can grow very much.
As for the fourth column, it is the reform of the state as a state and the establishment of structural reforms in various ministries.
Accordingly, the four columns are interconnected, but work must be done at the level of each column, accounting is with the judiciary and no one has another, and unfortunately we hear a lot about accountability and do not see it, and if the authority that is good for accountability takes the file in its hand and our judicial authority is fortified and we and we and we are independent, so we will certainly see this accountability and translate in a way that satisfies people.

– Today, in light of international and Arab support and promises to investments in Lebanon if the reforms take place, is there a dependence on the return of Arab and international investments, specifically the Gulf, which had played a basic role in terms of supporting the Lebanese banking sector?

All dependence on that, especially in the relationship with the Gulf states, and I hope that what is happening today is positive things in the Lebanese state to translate Lebanon’s return to its Arab surroundings as the international. President Aoun was recently in Saudi Arabia, and Prime Minister Nawaf Salam will visit the kingdom soon.

On the political level, it is working on the issue, and it is too early to talk about a quick result, but Lebanon is its natural position with the Gulf states and the Arab countries within its regional and international surroundings. Of course, Lebanon needs these reforms. I am optimistic that these things will happen soon.

What is the fate of the deposits of Iraqis and Syrians in Lebanese banks?

The Lebanese constitution preserves individual ownership, and therefore we do not have a distinction between an Arab foreign deposit and a local deposit. All deposits will be treated in the same way, and these deposits will be addressed through the laws we are talking about.

– What advice can you give to the new ruler who will be appointed soon?

I will hold a long session with him, and the situation in Lebanon is not easy but rather complicated, and in the past two years, I believe that we have succeeded in carrying out more than one level with some basic reforms within the institution in the Bank of Lebanon and we have felt the relationship with the Lebanese government, and I believe that one of the basic reforms to build a state in Lebanon and was required to do it for many years and this was not a complete separation of the Lebanese state financial from the financial bank of the bank. The second stage after that, the monetary topic must be developed, and all the foundations for that are present.

Consequently, the development of the institution inside and its relationship with the Lebanese government and with outside the institution has become more than normal, and the central bank today deals with all foreign international and European banks and regained its position among other central banks, from here the status of the institution is good, and I am sure that the new ruler will benefit from the situation that we are today to build on it to establish a better situation, whether it is inside the institution with the completion of the reforms after a major reform workshop started, and it needs to complete The central bank has a fundamental role to help with reforms at the level of the state as a whole, and I am sure that it will play a fundamental role in this matter.

Are there fears of the return of the crisis to the banking sector?

Be optimistic about the good you find it. And I believe that we are on a positive line, God willing, and I hope that the difficult will have passed and the coming forward is better.