Lebanon Will Probably Restructure Debt, Foreigners Will Be Paid

Lebanon’s sovereign debt is probably going to be restructured in a way that hurts neither the economy nor depositors, and foreign holders will be repaid, the banking association head said on Monday, Reuters reported. Salim Sfeir also said he did not foresee problems with a proposal for Lebanese banks to swap their holdings in a maturing March Eurobond of $1.2 billion for longer dated notes, describing such swaps as “common practice”. Central bank governor Riad Salameh has proposed the swap to Lebanese banks though it is up to the government to decide, senior financial and government sources said. One of the world’s most heavily indebted states, Lebanon is mired in a deep financial crisis. A dollar shortage has led banks to control access to deposits and block transfers abroad. Sfeir, the Bank of Beirut’s chief executive, said he had not seen such a crisis during his 50 years in banking. Read more