Lebanon may only count on the International Monetary Fund for as little as half the bailout it had originally sought to help unlock other assistance the country critically needs to bridge the crisis, according to a top official, Bloomberg News reported. With talks over a $10 billion loan program stalling for much of this month, the IMF could provide an amount in a range of $5 billion to $9 billion, Economy Minister Raoul Nehme said in an interview with Bloomberg Television. Although Lebanon’s economic collapse is accelerating, Nehme gave no time frame for when a deal might be reached.

Lebanon had its rating cut to the lowest grade by Moody’s Investors Service, which said that bond investors will likely suffer major losses on their holdings as the government struggles to secure aid to ease a crippling financial crisis, Bloomberg News reported. Moody’s lowered Lebanon’s credit score to C from Ca, the same level as crisis-ravaged Venezuela. It reflects Moody’s “assessment that the losses incurred by bondholders through Lebanon’s current default are likely to exceed 65%,” the agency said in a statement.

Hyperinflation has blighted Zimbabwe, Venezuela and the former Yugoslavia among others over the years, Reuters reported. Now, Lebanon has been gripped by the phenomenon, becoming the first country in the Middle East and North Africa to suffer from rapid, runaway price rises for goods and services. It joins Venezuela, which has been locked in hyperinflation since April, its second bout in recent years, according to Steve H. Hanke, Professor of Applied Economics at the Johns Hopkins University and an expert on the topic.

Lebanon’s central bank has set up a committee to restructure financially stricken commercial banks and study their performance, according to a memo by the bank seen by Reuters on Thursday, Reuters reported. The panel will also propose measures to preserve the soundness of the banking sector, the memo said. Lebanese banks are poised for a major shake-out after the country plunged into a financial crisis last October that has ballooned prices, slashed jobs, and brought on capital controls that have frozen people out of their dollar savings.

The International Monetary Fund urged Lebanese authorities on Monday to unite around a government rescue plan and warned that attempts to lower losses from the financial crisis could only delay recovery, Reuters reported. The government’s rescue plan has served as the cornerstone of talks with the IMF and maps out massive losses in the financial system. The talks have been bogged down by a row over the scale of financial losses that has embroiled the government, the central bank, commercial banks and lawmakers from Lebanon’s main political parties.

Lebanese lawmakers urged the government to avoid a default on its local-currency debt and asked it to reevaluate central bank liabilities to help secure a critical bailout from the International Monetary Fund, Bloomberg News reported. Member of parliament Ibrahim Kanaan said Wednesday that the IMF held a meeting with lawmakers earlier this month and told them Lebanon faces a choice of “no reform, no program” -- referring to the $10 billion loan the government is trying to negotiate with the Washington-based lender.

The IMF has warned Lebanon that its central bank has accumulated losses of as much as $49bn, as divisions between the government and the Banque du Liban threaten to derail vital bailout talks with the multilateral lender, the Financial Times reported. The BDL does not publish profit and loss accounts.

The International Monetary Fund remains in discussions with Lebanon about possible financing arrangements, an IMF spokesman said on Thursday, adding that it was premature to discuss the scope of any potential program, Reuters reported. Spokesman Gerry Rice declined to give any details on reforms the Fund would require before it would authorize a program, but said the Lebanese government needed to implement comprehensive, equitable reforms in many areas. He said Lebanon also needed to reach a common understanding about the source and size of the financial losses it faces.

Lebanon’s tax revenues dropped 12.5% during the first quarter of 2020 compared to a year earlier, ministry of finance data showed on Thursday, as a bruising financial crisis took its toll, Reuters reported. Lebanon has seen its currency plunge in value and unemployment soar since anti-government protests erupted last October. It defaulted on its sovereign debt before entering talks with the International Monetary Fund last month. The finance ministry data is the first to capture a full quarter since the protests started.

Emerging market investors are no strangers to sovereign debt crises, but few have been as perilous as the one facing Lebanon given a toxic combination of financial and political weaknesses and no obvious economic platform on which to build a recovery, Reuters reported. Since defaulting for the first time on its foreign currency debt in March, Lebanon has formed a rescue plan and started negotiations with the International Monetary Fund on $10 billion of aid, both moves that would normally be read as positive for a country mired in debt.