According to Lebanon’s consolidated commercial banks’ balance sheet, total assets followed a monthly uptick of 0.47%, first increase since December 2020 but decreased annually by 5.68% to stand at $172.93B by May 2022.
On the liabilities side, resident customers’ deposits were the main account, representing 59.91% of total liabilities; they decreased by 3.05% since May 2021 while they recorded an increase of 0.69% on a monthly basis to reach $103.59B in May 2022. The increase could be attributed to the substantial upsurge in Lebanese pounds’ deposits that it registered a 5.48% increase on a monthly basis and 15.12% on an annual basis while the deposits in foreign currencies decreased by 0.89% on a monthly basis and 8.17% yearly. Customers seem to deposit more Lebanese pound into their accounts while others are conducting limited withdrawals in foreign currencies, in addition most of transactions today are only paid in fresh dollars out of the banking system like the Real Estate Transactions that are fully paid in fresh cash.
As for Non-resident customers’ deposits, grasping 13.88% of total liabilities, they recorded a drop of 10.10% and stood at $24.00B in May 2022. In details, the deposits in LBP retracted by 6.09% to reach $2.06B while deposits in foreign currencies declined by 10.46% to reach $21.94B over the same period. More importantly, the dollarization ratio for private sector deposits decreased from 80.50% in May 2021 to 76.97% in May 2022. It is interesting to reflect that resident and non-resident customers’ deposit represent 73.79% of total liabilities. In addition, Non-resident financial sector Liabilities held 2.53% of total Liabilities and decreased by 16.88% to reach $4.38B YOY.
On the assets side, currency and deposits with Central Bank represented a high figure of 66.06% of total assets; they recorded a yearly uptick of 3.06% to settle at $114.24B in May 2022. Deposits with the central bank (BDL) represented 96.65% of total reserves, and slightly increased by 1.04% YOY, to reach $110.40B in May 2022. Meanwhile, Vault cash in Lebanese pound jumped by 142.1% on a yearly basis to stand at $3.83B by the same period. The increase could be related to the ongoing transactions conducted through Sayrafa platform as banks are receiving heavy Lebanese deposits from their clients coming from volumes traded daily on Sayrafa and being transferred to the Central Bank’s vault.
Meanwhile, Claims on resident customers, constituting 12.61% of total assets, shrank significantly by 23.97%, to stand at $21.80B in May 2022. Moreover, Resident Securities portfolio (10.06% of total assets) dropped by 18.41% in May 2022 to stand at $17.38B. More specifically, the Eurobond holding recorded a decline of 48.68% since May 2021, to reach $4.22B in May 2022, as banks are selling their Eurobonds to shore up their foreign currency liquidity.
Commercial Banks Assets and Residents Customer Deposits by May ($B)
Source: BDL, BLOMINVEST