BDL’s Proposed Preliminary Updated Framework for Bank Recapitalization and Deposit Recovery

The Banque du Liban (BDL) recapitalization and deposit repayment proposal, based on articles published in (leaked to!) the media on 31 July 2026, outlines a broad framework for restructuring Lebanon’s banking sector and addressing the large stock of deposits that has remained effectively trapped since the financial crisis. Based on the preliminary Asset Quality Review (AQR) of 56 licensed banks, BDL estimates that the sector would require approximately $2.268 billion in fresh capital. Of the banks reviewed, 41 would first have to absorb part of their accumulated losses and reduce their existing capital before receiving new injections. The recapitalization requirement is heavily concentrated among the 14 Alpha banks, which would need approximately $1.818 billion, while 25 smaller banks would require around $450 million. Meanwhile, 15 mostly small, specialized or foreign-owned institutions, collectively accounting for less than 0.2% of deposits, would require no additional capital.

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