According to Lebanon’s consolidated commercial banks’ balance sheet, total assets declined annually by 9.46% to stand at $104.13B by February 2024 amid BDL’s adoption of a new exchange rate of LBP 89,500 per USD effective 31/01/2024.
On the assets side, currency and deposits with Central Bank represented a high figure of 78.03% of total assets; they dropped annually by 4.35% to settle at $81.25B in February 2024. Deposits with the central bank (BDL) represented 99.88% of total reserves, and decreased by 3.92% YOY, to reach $81.15B in February 2024. Furthermore, vault cash in Lebanese pound declined by 80.11% on a yearly basis to stand at $94.86M by the same period. The drop is attributed to the calculation based on the new official exchange rate of LBP 89,500 per USD.
Claims on resident customers, constituting 5.85% of total assets, shrank considerably by 34.04%, to stand at $6.09B in February 2024. Moreover, resident securities portfolio, representing 4.59% of total assets, dropped by 28.19% in February 2024 to stand at $4.78B. More specifically, the Eurobond holding recorded a decline of 22.65% since February 2023, to reach $2.19B by end of February 2024. Additionally, claims on non-resident financial sector grew by 5.87% YOY to stand at $4.37B by February 2024.
On the liabilities side, resident customers’ deposits were the main account, representing 66.46% of total liabilities; they dropped by 7.73% since February 2023 to reach $69.2B by the month of February 2024. In more details, deposits in foreign currencies (being 99.24% of resident customers’ deposits) declined by 5.07% YOY to reach $68.68B by February 2024, additionally deposits in LBP (0.76% of resident customers’ deposits) fell by 80.24% YOY to stand at $525M by February 2024 especially after applying the new official exchange rate of 89,500. This reveals that Lebanon has become dollarized and cash based.
As for non-resident customers’ deposits, grasping 20.13% of total liabilities, they recorded a drop of 2.36% and stood at $20.96B in February 2024. In details, the deposits in LBP fell by 84.51% to reach $31.34M (after applying the new official exchange rate of 89,500) and deposits in foreign currencies declined by 1.58% to reach $20.93B over the same period. In addition, non-resident financial sector liabilities held 2.62% of total liabilities and decreased by 17.78% YOY to reach $2.73B in February 2024. More importantly, the dollarization ratio for private sector deposits increased from 96.92% in February 2023 to 99.37% in February 2024.
Commercial Banks Assets and Residents Customer Deposits by February 2024 ($B)
Source: BDL, BLOMINVEST
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