The Lebanese cabinet approved a draft law designed to allow depositors to recover funds trapped in the banking system for years, a critical step in resolving the country's financial woes. Lebanese Prime Minister Nawaf Salam said that after the draft law is approved by Parliament, depositors can apply to recover up to 100,000 US dollars within the next four years. Funds above this limit will be converted into bonds backed by central bank assets. Since it defaulted on about $30 billion in international bonds in 2020, Lebanon has been mired in a deep economic crisis. In the years before the crisis began, banks in Lebanon held billions of dollars in the central bank. As foreign capital inflows dried up in 2019, the mechanism linking the local currency to the US dollar collapsed. The central bank was unable to repay the bank about $80 billion at the time.

The Lebanese cabinet approved a draft law designed to allow depositors to recover funds trapped in the banking system for years, a critical step in resolving the country's financial woes. Lebanese Prime Minister Nawaf Salam said that after the draft law is approved by Parliament, depositors can apply to recover up to 100,000 US dollars within the next four years. Funds above this limit will be converted into bonds backed by central bank assets. Since it defaulted on about $30 billion in international bonds in 2020, Lebanon has been mired in a deep economic crisis. In the years before the crisis began, banks in Lebanon held billions of dollars in the central bank. As foreign capital inflows dried up in 2019, the mechanism linking the local currency to the US dollar collapsed. The central bank was unable to repay the bank about $80 billion at the time.