Total Value of Cleared Checks Down by 3.5% to $36B by August 2020

As per the data published by the Association of Lebanese Banks’ (ABL), the total number of cleared checks in the Lebanese financial system slumped from 6.90M checks by August 2019 to 3.98M checks by August 2020. Moreover, the value of total cleared checks declined yearly by 3.5% to reach $36B by August 2020.

In details, the decrease in the value of total checks can be attributed to the downticks in the values of checks denominated in both Lebanese pounds (LBP) and in foreign currencies which dropped by 9.0% year-on-year (YOY) and 0.3% YOY to $12.81B and $23.26B, respectively, in the first eight months of 2020.

The volumes of cleared checks denominated in Lebanese Pounds and foreign currencies witnessed significant yearly drops of 35% and 48.2% to settle at 1.99M checks and 1.98M checks, respectively by August 2020.

As we can notice, the yearly decrease of 42.3% in the volume of total cleared checks is associated with a slight yearly decrease of 3.5% in the total value of cleared checks which shows that depositors are issuing fewer checks with higher value. In fact, depositors are mainly withdrawing banker’s checks to invest in real estate sector given the uncertainty in the financial sector.

Accordingly, the dollarization of cleared checks in terms of value went from last year’s 62.37% to 64.49% by August 2020. Meanwhile, the dollarization rate of checks in terms of volume fell from last year’s 55.51% to 49.85% by August 2020.

Notably, the number of returned checks fell by a substantial 37% YOY to 109,162 checks while the value of the returned checks retreated by 24.3% YOY over the same period to reach $701M by August 2020.

Number & Value of Cleared Checks by August (in $B)

Total Value of Cleared Checks Down by 3.5% to $36B by August 2020 

Source: ABL, BlomInvest Bank

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