PM Salam unveils draft law to recover deposits, restore financial order

Lebanese Prime Minister Nawaf Salam said the government has completed a draft law aimed at restoring financial order and recovering bank deposits, renewing its commitment to depositors and economic reform outlined in its ministerial statement.

In a speech, Salam said the draft law on financial regularization and deposit recovery was finalized after the approval of laws lifting banking secrecy and reforming the banking sector. 

The draft has been sent to ministers for review ahead of Cabinet discussions scheduled for Monday, with the government hoping to approve it without delay.

Salam acknowledged widespread anger among depositors after years of financial collapse, saying the state had failed to protect citizens’ savings and allowed promises to go unfulfilled. 

He stressed that the government would not offer temporary solutions to a crisis that has lasted for years, describing the new draft as the start of a phase based on transparency, accountability and enforceable legislation.

The prime minister said the proposal represents the first comprehensive legal framework to address the financial gap and recover deposits in a systematic and equitable manner, within available resources. 

He described it as a shift from denying losses to recognizing and managing them realistically, while protecting social stability and rebuilding confidence in the financial system.

Under the draft, depositors with savings of less than $100,000 would receive their full deposits over four years. Salam said this category represents 85% of all depositors.

Medium and large depositors would receive $100,000 in full, along with tradable bonds equivalent to the remaining value of their deposits, without any reduction to the principal. 

The bonds would be repaid according to a clear timetable and backed by revenues and returns from the assets of the central bank, or proceeds from any asset sales.

Salam said the law also aims to rehabilitate the banking sector through asset evaluation and recapitalization, allowing banks to resume their role in financing the economy, stimulating growth and reducing reliance on the cash economy.

For the first time, the draft introduces accountability for extraordinary profits through targeted penalties on those who benefited from the crisis, including individuals who transferred funds using influence, profited from financial engineering, or converted Lebanese pounds to dollars at preferential rates.

The prime minister said the state would commit to recapitalizing the central bank in line with the law and international standards, adding that the draft aligns with key requirements of the International Monetary Fund.

Salam acknowledged that the proposal is not perfect and may not meet all expectations, but described it as a realistic and fair step toward restoring rights, halting the financial collapse and reviving economic growth.

He warned that continued delays would further erode deposits, saying the law provides a clear roadmap to end the prolonged crisis and begin restoring confidence in Lebanon’s economy.