http://www.dailystar.com.lb/Business/Lebanon/2012/May-05/172421-lebanons-public-debtreaches-%24539-billion-in-february.

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As of February 2012, Lebanons gross public debt amounted to LL81.210trillion ($53.9billion), an increase from last months LL80.907trillion (which means an increase of over LL420billion), the Lebanese Banks (ABL) reported. But it does not look like the increasing will debt stop there. Finance Minister, Mohammed Safadi, believes that by the end of 2012, it will increase to around $60billion. With the increased debt, there came some surprisingly good news; the percentage of the debt in relation to the Lebanese GDP is still under 138 percent which would be because of the decreased interest rates on bonds and the growth of the Lebanese economy, which is now $39billion. But even with the growth of the economy and the drop in interest rates, tackling the public debt still remains to be one of the largest challenges Lebanon has to accomplish. Prime Minister Najib Mikati still has not been able to formalize a secure plan to tackle the public debt or even submit the 2012 draft budget, which is aimed at reducing the budget deficit while pumping more cash into the treasury and decreasing spending. The Finance Ministry, on the other hand, has been able to lower the budget deficit in the last few months due to an increase on revenues which have lowered the fiscal deficit by around LL290billion during the first two months of 2012, compared to the first two months of 2011. The fiscal deficit until February 2012 amounted to just over 18 percent of expenditure at LL538billion, compared to the deficit of 30.69 percent (LL828billion) of February 2011. On the other hand, then primary surplus (not including the cost of debt servicing) amounted to LL66billion, spiking LL103billion from an LL37billion public deficit that was also registered on February 2011. Total revenue experience a rise of 30 percent (LL523billion) to amount to LL2.433 trillion compared to LL1.870 trillion of January and February of 2011. ABL also reported total bank assets of February 2012 to be LL217.247 trillion ($144.1billion) compared to LL211.918 trillion of January 2011. Also, despite the unstable political and security situation of the country, January and February of 2012 had shown better improvement compared to the January and February of 2011. Despite the improvements of 2012, ABL recorded a balance of payments deficit of $424million in January and February although the Central Banks foreign currency reserves stayed just under $40billion. Lebanese imports also entered the record books for reaching just under $2.8billion in February 2012 compared to January 2012s

$1.424billion. This means that imports in the first two months surged by 44.3 percent compared to the same period of last year, ABL said.

http://www.dailystar.com.lb/Business/Lebanon/2012/May-05/172425-private-sector-loansexceed-those-to-public-departments.ashx#axzz1uD9UaZJp

Lebanese loans to the private sector surpassed the limit credit line given to the public departments for the first time since 2008 as the number of borrowers became 564000 reported Saad Andari, the Central Banks Vice President. We have high liquidity, enabling us to unfreeze some of the Central Bank reserves to boost the economy, Andari added. This has allowed *the Central Bank+ to embark on various initiatives to stimulate lending and investments by the private sector. Andari said that he is with the idea of mandatory cash reserves necessary by the Central Bank, regardless of the limit the policy puts on the private banks capability to lend. He has also voiced his criticism of the role of the central banks of the G-20 economies. These central banks used to let the markets regulate *without significant intervention+ and the result was financial crises that started in 2007, he said, signifying that the financial crisis of 2008 is not going to be over soon.

http://www.executive-magazine.com/getarticle.php?article=15412

The Special Investigation Commission (SIC), which was created by the Banque Du Liban (Lebanons Central Bank) to fight money laundering, released a yearly report stating that banking secrecy was raised on 18 accounts in Lebanon last year. 13 out of the 18 cases were from domestic sources, whereas the remaining 5 were from abroad sources. Last year, the SIC received 335 cases that were suspected of money laundering, an increase of 245 cases in 2010 and 202 cases the year before that. Of the 335 cases, 100 were from abroad sources and the remaining 235 were from domestic sources; the SIC in total investigated around 285 cases. Counterfeiting appears to be the most common crime, amounting to around 13 percent of all cases, terrorism funding follows second at 8.5 percent of reported cases, at 6 percent follows fraud of private funds, narcotics composes 4.5 percent of cases and embezzlement of public funds is the least at 3 percent. The remaining 65 percent of the cases have not been characterized. Reporting entities were assessed via extensive on-site examinations and follow-up corrective measures were imposed, according to central bank Governor Riad Salameh.

In June 2012, 30 percent of the $700million Lebanese Eurobond distributed was oversubscribed, leading to a boost in the finance ministrys resources. In a plan to bring in $350million from the Eurobonds, $600million was brought in instead from the first set (just for your information, the Eurobonds carry 5 percent yield and matures in October 2017). The second set of Eurobonds brought in the expected $350million (this set carries a 6 percent yield and expires on April 27, 2026). From the subscribers of the Eurobonds, 30% are Non-Lebanese with the rest taken by the Lebanese banks such as Byblos Bank. American-Merrill Lynch was one of the leading managers on the Eurobond as well (with Byblos Bank). The purpose of this issue of Eurobonds was to finance $293million and $151million in Eurobonds which expired in March and April 2012. And in order to deal with the 2012 public debt, the finance ministry will be issuing $5billion worth of Eurobonds and treasury bills.