Path to Lebanon’s banking reform law remains slow and challenging

2^min

Report by Lea Fayad, English adaptation by Mariella Succar

The road to financial reforms in Lebanon—especially the banking reform law—remains far from smooth.

Although the government approved the law about a month ago, it is still awaiting discussion and ratification in Parliament.

During the latest parliamentary Finance and Budget Committee session, Banque du Liban Governor Karim Souaid submitted a legal study that criticized several aspects of the draft law.

These included concerns about undermining the Central Bank’s independence and expanding the powers of the Banking Control Commission.

In response, committee chair Ibrahim Kanaan announced the formation of a subcommittee to examine the bill further and work toward a more acceptable version before it is brought back to the main committee, and then eventually to Parliament.

This raised concerns over a possible repeat of the delays and obstruction that have plagued reform efforts since 2020.

However, Finance Minister Yassine Jaber expressed optimism. He dismissed fears of deadlock and said the reform laws are intended to revive the banking sector, not harm it, as some have claimed.

He made the remarks during a meeting with Economic and Social Council members.

During the same meeting, participants called on the minister to address a range of other financial issues.

Mohammad Choucair highlighted the need for customs reform; Farid Boustany raised concerns about public sector salaries; and Bechara Asmar focused on tax policies.

Lebanon remains in dire need of a comprehensive reform drive. Among the most urgent reforms is the banking reform law, seen as a key step toward restoring public and international trust in the country’s financial institutions and unlocking vital foreign funding.