Lebanese depositors will ultimately recover their funds as part of a broader financial rescue plan, with the burden of economic recovery to be shared among the state, central bank, and commercial lenders, Economy Minister Amer Bisat said in his first international media interview.

Speaking to Bloomberg TV, Bisat underscored that safeguarding depositors’ funds is a central element of the government’s reform objectives, even if the process is gradual.

“Depositor protection is an extremely important part of the objectives that we have in place. That may require instruments, that may require delays, or some time passage in order to pay, but the idea is that nobody would lose their deposits. But it may take time,” he said.

The statement comes amid Lebanon’s ongoing efforts to break a longstanding political and financial impasse that has obstructed key reforms necessary to unlock billions in international aid, particularly from the International Monetary Fund (IMF).

Lebanese authorities have been unable to reach a consensus on how to allocate the vast financial losses plaguing the banking system. Local banks have repeatedly resisted proposals that would see them absorb the majority of the financial hit, along with calls for sector-wide consolidation.

Bisat, a former managing director at investment giant BlackRock Inc., emphasized the need for a “collective solution” that ensures the survival of Lebanon’s banking sector while preserving the central bank’s capacity to conduct monetary policy.

“There’s a limit to how much we can impose on each of them,” he noted.

Lebanon defaulted on around $30 billion in Eurobonds in 2020, marking its first-ever sovereign debt default. The fallout triggered a collapse of the Lebanese pound, which has lost more than 98% of its value, sent inflation into triple digits, and wiped out the savings of countless citizens as banks imposed informal capital controls.

The financial gap, largely attributed to years of fiscal mismanagement and monetary excesses, is estimated to be approximately $70 billion — more than three times the country’s current GDP. Much of the shortfall stems from the central bank’s post-2016 policies, which involved tapping into depositor funds to finance chronic government deficits and sustain an unsustainable currency peg.

To address the opacity surrounding the sector’s financial health, Bisat expressed optimism that a recently approved banking secrecy law would be ratified in Parliament in the coming weeks. The measure is seen as critical to gaining a clearer picture of the capital gaps at individual banks and to designing an equitable restructuring plan.

Despite the urgency of domestic reform, Bisat warned that external headwinds could complicate Lebanon’s recovery. He pointed to global trade disruptions and financial market volatility as risks that could curb remittance inflows from Lebanon’s diaspora — among the largest per capita in the world — which remains a key lifeline for many families.

He also stressed the importance of regional stability, particularly maintaining the fragile truce between Hezbollah and Israel. Renewed hostilities, he said, could derail the country’s tentative recovery and further isolate it from foreign investment.

Looking ahead, the government is planning an investor conference in September to signal Lebanon’s intent to re-enter global financial markets. Bisat said the event would aim to show that “Lebanon is back in play, Lebanon is back in business.”