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Lebanon Signs Central Bank Audit Contract with A&M

Lebanon Signs Central Bank Audit Contract with A&M

Friday, 17 September, 2021 - 08:15
A view shows the Central Bank building, in Beirut, Lebanon November 12, 2020. REUTERS/Mohamed Azakir

Lebanon's finance minister Youssef Khalil on Friday signed a new contract with restructuring consultancy Alvarez & Marsal (A&M) to carry out a forensic audit at the country's central bank, the ministry said in a statement.

A&M will give an initial report to the ministry within 12 weeks of its team starting work, Reuters quoted the ministry as saying.

Lebanon is suffering one of the deepest economic depressions in modern history. Three-quarters of its population is now classified as poor by the United Nations and the local currency has lost 90% of its value in the past two years.

The plan for an audit, a key requirement for Lebanon to secure foreign aid amid its financial meltdown, hit a roadblock in November when A&M withdrew, saying it had not received the information it needed from the central bank.

Parliament then agreed in December to lift banking secrecy for one year, amid much back-and-forth between Lebanese officials including the ministry and the central bank over whether certain information could be disclosed.

The finance ministry said in April the central bank had agreed to hand over some documents.

Khalil, a former top central bank official, was appointed finance minister as part of a new cabinet cobbled together by Prime Minister Najib Mikati and President Michel Aoun after a year of political deadlock that has compounded the country's economic meltdown.

Mikati's cabinet has said it was committed to a resumption of talks with the International Monetary Fund, pre-conditions for which include a restructuring of the banking sector and public debt.

Last year's IMF talks were derailed when politicians and bankers disputed the scale of financial losses mapped out in a financial recovery plan drawn up by the then government.

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