According to the data published by the Association of Lebanese Banks’ (ABL), the total number of cleared checks in the Lebanese financial system decreased remarkably by 57.76% year over year (YoY) to 173,750 checks by November 2024. However, the cumulative value of cleared checks in local currency increased by 20.79% YoY to LBP 72,329B by November 2024. This upsurge in value of Lebanese checks given that the number of Lebanese checks issued decreased reflects a larger percentage of discounting Lebanese checks in the market. However, the cumulative value of cleared checks in foreign currency dropped by 60.82%YoY to $1,218M by November 2024.
Moreover, the volumes of cleared checks in Lebanese Pounds and foreign currencies witnessed substantial yearly drop of 50.31% and 83.91% respectively to settle at 159,079 and 14,671 checks, by November 2024. Accordingly, the dollarization rate of checks in terms of volume fell from 22.17% in November 2023 to 8.44% in November 2024.
Notably, the number of returned checks dropped substantially by 69.71% YoY to stand at 979 checks in November 2024. Moreover, the value of returned checks in local & foreign currency decreased YoY respectively by 23.37% and 61.38% by November 2024 to record LBP 600B and $67.97M.
Banque du Liban (BDL) recently issued Circular 165, which permits depositors to make payments by check starting June 1st, 2023, as long as their accounts are in either fresh US dollars or Lebanese lira. To support this initiative, BDL has introduced a new clearing system, distinct from the one dedicated to pre-crisis deposits. This circular serves a dual purpose: it encourages customers to open new accounts in both Lebanese pounds and US dollars, while also aiming to decrease the country’s dependence on cash and stimulate economic recovery. As such, in November 2024, the cumulative number of checks issued from fresh accounts reached 28,522, of which 19,955 checks are in USD currency amounting $262.08M and 8,567 checks are in LBP currency amounting LBP 15,723B. On a monthly basis, the number of cleared checks in November 2024 was 3,405 checks.
Cleared Checks by November 2024 (in 000s)
Disclaimer:
This article is a research document that is owned and published by BLOMINVEST BANK SAL.
No material from this publication may be modified, copied, reproduced, repackaged, republished, circulated, transmitted or redistributed directly or indirectly, in whole or in any part, without the prior written authorization of BLOMINVEST BANK SAL.
The information and opinions contained in this document have been compiled from or arrived at in good faith from sources deemed reliable. Neither BLOMINVEST BANK SAL, nor any of its subsidiaries or affiliates or parent company will make any representation or warranty to the accuracy or completeness of the information contained herein.
Neither the information nor any opinion expressed in this research article constitutes an offer or a recommendation to buy or sell any assets or securities, or to provide investment advice.
This research article is prepared for general circulation and is circulated for general information only.